UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the Quarter Ended March 31, 1999
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 000-21952
AMERICAN SAFETY RAZOR COMPANY
(Exact name of registrant as specified in its charter)
Delaware 54-1050207
- ----------------------- ---------------------------------------
(State of incorporation) (I.R.S. Employer Identification Number)
One Razor Blade Lane, P.O. Box 979, Verona, Virginia 24482-0979
- ----------------------------------------------------------------
(Address of principal executive offices, including zip code)
(540)248-8000
- -----------------------------
Registrant's telephone number
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 [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of April 20, 1999.
Class Outstanding at April 20, 1999
----- -----------------------------
Common Stock, $.01 Par Value 12,110,349
<PAGE>
AMERICAN SAFETY RAZOR COMPANY
Index
Page Number
Part I. Financial Information
Item 1. Financial Statements
Condensed Consolidated Balance Sheets
March 31, 1999 (Unaudited) and December 31, 1998 1
Condensed Consolidated Statements of Income (Unaudited)
Three months ended March 31, 1999 and March 31, 1998 3
Condensed Consolidated Statements of Comprehensive
Income (Unaudited)
Three months ended March 31, 1999 and March 31, 1998 3
Condensed Consolidated Statements of Cash Flows (Unaudited)
Three months ended March 31, 1999 and March 31, 1998 4
Notes to Condensed Consolidated Financial Statements 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 15
Item 3. Quantitative and Qualitative Disclosure of Market Risk 20
Part II. Other Information
Item 1. Legal Proceedings 20
Item 6. Exhibits and Reports on Form 8-K 20
Signatures 21
<PAGE>
<TABLE>
AMERICAN SAFETY RAZOR COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
<CAPTION>
March 31, December 31,
1999 1998
--------- ------------
(Unaudited)
ASSETS
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 1,588 $ 3,453
Trade receivables, net 40,152 44,498
Inventories 59,305 54,029
Income taxes receivable - 989
Deferred income taxes 5,365 5,108
Prepaid expenses 2,542 2,340
--------- ---------
Total current assets 108,952 110,417
Property and equipment 126,985 124,814
Less accumulated depreciation (52,229) (50,149)
--------- --------
74,756 74,665
Intangible assets, net:
Goodwill 67,928 68,446
Other 3,140 3,365
--------- ---------
71,068 71,811
Prepaid pension cost and other 6,594 6,004
--------- ---------
Total assets $261,370 $262,897
======== ========
</TABLE>
See accompanying notes.
-1-
<PAGE>
<TABLE>
AMERICAN SAFETY RAZOR COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
<CAPTION>
March 31, December 31,
1999 1998
--------- ------------
(Unaudited)
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 16,153 $ 14,269
Accrued expenses and other 17,887 19,968
Income taxes payable 316 -
Current maturities of long-term obligations 3,917 3,852
--------- ---------
Total current liabilities 38,273 38,089
Long-term obligations 119,795 123,481
Retiree benefits and other 25,250 25,163
Deferred income taxes 6,955 6,610
--------- ---------
Total liabilities 190,273 193,343
-------- --------
Stockholders' equity:
Common Stock, $.01 par value, 25,000,000 shares
authorized; 12,110,349 shares
issued and outstanding at March 31, 1999
(12,110,049 at December 31, 1998) 121 121
Additional paid-in capital 65,907 65,905
Retained earnings 6,431 4,457
Accumulated other comprehensive loss (1,362) (929)
---------- ----------
71,097 69,554
Total liabilities and stockholders' equity $261,370 $262,897
======== ========
</TABLE>
See accompanying notes.
-2-
<PAGE>
<TABLE>
AMERICAN SAFETY RAZOR COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In thousands, except per share data)
<CAPTION>
Three Months Ended
March 31,
-------------------
1999 1998
------- -------
<S> <C> <C>
Net sales $70,287 $66,511
Cost of sales 46,829 47,003
------- -------
Gross profit 23,458 19,508
Selling, general and administrative expenses 16,507 13,521
Amortization of intangibles 647 631
Special charge - 1,003
--------- -------
Operating income 6,304 4,353
Interest expense 3,030 3,045
------- ------
Income before income taxes 3,274 1,308
Income taxes 1,300 519
------- ------
Net income $1,974 $789
====== ====
Basic earnings per share:
Net income $0.16 $.07
===== ====
Weighted average number of shares outstanding 12,110 12,103
====== ======
Diluted earnings per share:
Net income $0.16 $.06
===== ====
Weighted average number of shares outstanding 12,189 12,337
====== ======
See accompanying notes.
</TABLE>
<TABLE>
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)
(In thousands)
<CAPTION>
Three Months Ended
March 31,
------------------
1999 1998
------- ------
<S> <C> <C>
Net income $1,974 $789
Other comprehensive income (loss):
Foreign currency translation adjustments (433) 88
------- -----
$1,541 $877
====== ====
See accompanying notes.
</TABLE>
-3-
<PAGE>
<TABLE>
AMERICAN SAFETY RAZOR COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In thousands)
<CAPTION>
Three Months Ended
March 31,
------------------
1999 1998
------- -------
<S> <C> <C>
Operating activities
Net income $1,974 $ 789
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization 3,206 2,977
Amortization of interest and financing costs 138 136
Retiree benefits and other (936) (167)
Deferred income taxes 88 881
Changes in operating assets and liabilities:
Trade receivables 4,346 7,177
Inventories (5,276) (4,734)
Income taxes receivable 989 (567)
Prepaid expenses (202) (966)
Accounts payable 1,884 79
Accrued expenses and other (2,081) (4,180)
Income taxes payable 316 (483)
------- -------
Net cash provided by operating activities 4,446 942
Investing activities
Capital expenditures (2,650) (2,956)
Other, net (28) -
------- ------
Net cash used in investing activities (2,678) (2,956)
Financing activities
Repayment of long-term obligations (7,072) (3,102)
Proceeds from borrowings 3,437 5,409
Proceeds from exercise of stock options 2 73
-------- -------
Net cash (used in) provided from financing activities (3,633) 2,380
Net increase (decrease) in cash and cash equivalents (1,865) 366
Cash and cash equivalents, beginning of period 3,453 1,434
------- -------
Cash and cash equivalents, end of period $1,588 $1,800
====== ======
See accompanying notes.
</TABLE>
-4-
<PAGE>
AMERICAN SAFETY RAZOR COMPANY
Notes to Condensed Consolidated Financial Statements (Unaudited)
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments considered
necessary for a fair presentation have been included. Operating results for the
three month period ended March 31, 1999, are not necessarily indicative of the
results that may be expected for the year ended December 31, 1999. The balance
sheet at December 31, 1998 has been derived from the audited financial
statements at that date but does not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. For further information, refer to the consolidated
financial statements and footnotes thereto included in the Registrant's Annual
Report on Form 10-K for the year ended December 31, 1998.
NOTE B - INVENTORIES
Classification of inventories is as follows:
<TABLE>
<CAPTION>
March 31, December 31,
1999 1998
--------- ------------
(In thousands)
<S> <C> <C>
Raw materials $22,070 $18,797
Work-in-process 6,285 6,612
Finished goods 27,398 25,070
Operating supplies 3,477 3,475
-------- --------
59,230 53,954
Excess of LIFO inventory value over current cost 75 75
--------- ---------
$59,305 $54,029
======= =======
</TABLE>
NOTE C - SPECIAL CHARGES
In March 1998, the Company recorded a special charge of approximately $1,003,000
related to the shutdown of the Company's cotton operations in Sparks, Nevada and
employee terminations.
The following table provides information about the changes in the Company's
accrued special charges, including the special charge discussed above, for the
first quarter of 1999:
<TABLE>
<CAPTION>
Remaining Remaining
Balance at Charges in Balance at
January 1, 1999 1999 March 31, 1999
--------------- ----------- --------------
<S> <C> <C> <C>
Discontinuation of product line:
Contract termination $ 500,000 $ 500,000 $ -
Excess inventory and deferred charges 500,000 17,000 483,000
Severance and employee benefits 603,000 129,000 474,000
----------- --------- ---------
$1,603,000 $646,000 $957,000
========== ======== ========
</TABLE>
Amounts remaining at March 31, 1999 are included in accrued expenses in the
accompanying condensed consolidated balance sheets. Substantially all of the
remaining payments and asset impairments are expected to
-5-
<PAGE>
occur during the remainder of 1999.
NOTE D - LONG TERM OBLIGATIONS
At March 31, 1999, the Company had utilized $18.2 million of its revolving
credit facility and had approximately $31.8 million available for future
borrowings under this facility.
NOTE E - EARNINGS PER SHARE
The difference between the weighted average number of shares outstanding for
computing basic earnings per share and diluted earnings per share relates to the
Company's employee stock options outstanding which are assumed to be converted
for the diluted earnings per share calculation when the average market price of
the Company's common stock for the period exceeds the exercise price of the
employee stock options which are outstanding.
NOTE F - SEGMENT INFORMATION
<TABLE>
<CAPTION>
Three Months Three Months
Ended March 31, 1999 Ended March 31, 1998
------------------------ ------------------------
Razors Cotton Custom Razors Cotton Custom
and and Bar and and Bar
Blades Foot Care Soap Blades Foot Care Soap
------ --------- ------ ------ --------- ------
<S> <C> <C> <C> <C> <C> <C>
Net sales $ 44,282 $20,553$ 5,452 $38,674 $22,647 $5,190
Operating income 5,966 427 (89) 3,187 1,163 3
</TABLE>
A reconciliation of combined operating income of the Company's segments to
consolidated income before income taxes is as follows:
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------
1999 1998
-------- -------
<S> <C> <C>
Total operating income for segments $6,304 $4,353
Interest expense 3,030 3,045
------- -------
Income before income taxes $3,274 $1,308
====== ======
</TABLE>
NOTE G - MERGER
On February 12, 1999, RSA Holdings Corporation and RSA Acquisition Corporation,
which are affiliates of J.W. Childs Equity Partners II, L.P. ("J.W. Childs"),
entered into a merger agreement with the Company. Pursuant to the merger
agreement, as amended on April 8, 1999, RSA Acquisition has made an offer to
purchase all of the outstanding shares of common stock of the Company at a
purchase price of $14.20 per share, upon the terms and subject to the conditions
set forth in the offer to purchase ("the Stock Tender Offer"). The aggregate
purchase price, excluding transaction costs, to be paid for the common stock
purchased in the Stock Tender Offer, assuming all of the common stock (on a
fully diluted basis) is tendered, including the redemption of stock options, is
approximately $173.6 million. The Stock Tender Offer is conditioned upon, among
other conditions, there being validly tendered and not withdrawn, prior to the
expiration date of the Stock Tender Offer, a number of shares of common stock
which constitutes more than 50% of the voting power (determined on a fully
diluted basis) of all the equity securities of the Company. The Stock Tender
Offer expires on April 23, 1999.
The merger agreement provides that, following the completion of the Stock Tender
Offer, RSA Acquisition will be merged with and into the Company (the "Merger").
Following the Merger, the Company will continue as the surviving corporation and
will become a direct, wholly owned subsidiary of RSA Holdings, which will be
wholly owned by J.W. Childs, its affiliates and Company management. Closing for
the Merger is expected to occur in
-6-
<PAGE>
late April 1999.
In connection with the Merger, the Company has made an offer to purchase (the
"Note Tender Offer") all $100.0 million aggregate principal amount of its 9 7/8%
Series B Senior Notes due August 1, 2005 (the "Existing Notes"). In conjunction
with the Note Tender Offer, the Company has also solicited consents to eliminate
substantially all of the covenants contained in the indenture relating to the
Existing Notes. Any tender of Existing Notes pursuant to the Note Tender Offer
will also be a grant of consent with respect to such Existing Notes. The Note
Tender Offer expires on April 26, 1999.
Upon completion of the above transactions, as currently contemplated, the
Company expects it would have had approximately $227.9 million of indebtedness
outstanding as of March 31, 1999 as compared to historical indebtedness
outstanding as of March 31, 1999 of $123.7 million. The Company also expects
that as a result of the application of purchase accounting the Company's
depreciation expense and amortization of intangible assets will increase. In
addition, certain fees and expenses to be incurred relating to the above
transactions will be reflected either as components of the cost of the
transactions or as an expense (including the net cost to redeem stock options)
in the period in which the transactions are completed. The expenses to be
incurred in connection with the above transactions are expected to have a
material impact on results of operations in the period in which the transactions
are completed.
Upon consummation of the Merger, The Jordan Company, as advisor to the
transaction, will receive a fee of $2.5 million.
NOTE H - CONTINGENCIES
During 1998 the Company purchased bleached cotton from an outside supplier for
use in its pharmaceutical coil business. The Company converted this cotton from
incoming bales into a coil, which was shipped to its pharmaceutical customers to
be used as filler in bottles of oral dosage forms of pharmaceutical products to
prevent breakage. During the period from March through November of 1998, the
process by which the Company's supplier bleached this cotton was changed by
introducing an expanded hydrogen peroxide treatment. Subsequent testing
indicated varying levels of residual hydrogen peroxide in the cotton processed
during this time period and the supplier in November 1998 reduced the levels of
residual hydrogen peroxide in its bleaching process. The Company, to date, has
received complaints from approximately 10 customers alleging defects in the
cotton supplied them during the period and asserting these defects may have led
to changes in their products pharmaceutical appearance, and with respect to a
limited number of products, potency. The Company has received notice of 2 claims
for damages in the aggregate amount of approximately $1.7 million which the
Company believes primarily relates to alleged lost sales and merchandise damage,
and it is possible that additional damage claims might be forthcoming. On March
2, 1999, at the request of the Food and Drug Administration, the Company
notified all (numbering approximately 85) of its pharmaceutical cotton coil
customers that it was withdrawing from the market those lots of cotton coil
which may contain elevated levels of hydrogen peroxide.
The Company has notified its supplier that, in the Company's view, the supplier
is primarily responsible for damages, if any, that may arise out of this matter.
At this time, the Company's supplier has agreed to be responsible for the cost
of fiber, bleaching and freight of returned product, but has not agreed to be
responsible for any other damages and has expressed an intention to assert
defenses to our claims. The Company's insurance carriers have been timely
notified of the existence of the claim and have agreed to provide defense in a
reservation of rights letter, but are continuing to evaluate whether coverage
would apply to all aspects of the claims.
The Company has been advised by its general counsel that it has a number of
valid defenses to potential customer claims as well as a third party claim
against the supplier for damages, if any, incurred by the Company. However,
management is unable to make a meaningful estimate of the amount or range of
loss that could result from an unfavorable outcome relating to this overall
issue, and accordingly, there can be no assurance that our exposure from this
matter might not exceed the combination of our insurance coverage, if any, and
our recourse to suppliers. It is therefore possible that the Company's results
of operations or cash flows in a particular quarterly or annual period or its
financial position could be significantly and adversely affected by an ultimate
unfavorable outcome
-7-
<PAGE>
of this matter.
Weston Properties Investments III, Ltd. has filed a claim against the Company
for damages relating to delays in cost overruns attendant to the Company's
facility expansion in Cleveland, Ohio in the amount of $649,000. Management
believes that the outcome of this matter will not have a material adverse effect
on the Company's consolidated financial position or results of operations.
NOTE I - SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION
The Company's $100.0 million 9 7/8% Series B Senior Notes due 2005 have been
guaranteed, on a joint and several basis by certain domestic subsidiaries of the
Company, which guarantees are senior unsecured obligations of each guarantor and
will rank pari passu in right of payment with all other indebtedness of each
guarantor. However, the guarantee of one of the guarantor subsidiaries ranks
junior to its outstanding subordinated note.
The following condensed consolidating financial information presents condensed
consolidating financial statements as of March 31, 1999 and December 31, 1998,
and for the three months ended March 31, 1999 and 1998, of American Safety Razor
Company - the parent company, the guarantor subsidiaries (on a combined basis),
the non-guarantor subsidiaries (on a combined basis), and elimination entries
necessary to present such entities on a consolidated basis.
Separate financial statements and other disclosures concerning the guarantor
subsidiaries are not presented because management has determined that such
information would not be material to the holders of the 9 7/8% Series B Senior
Notes.
-8-
<PAGE>
<TABLE>
Condensed Consolidating Balance Sheets (Unaudited)
March 31, 1999
(In thousands)
<CAPTION>
Non-
Guarantor guarantor
ASR Subsidiaries Subsidiaries Eliminations Consolidated
--------- ------------ ------------ ------------ ------------
Assets
<S> <C> <C> <C> <C> <C>
Current assets:
Cash and cash equivalents $ 6 $ 121 $ 1,461 $ - $ 1,588
Trade receivables, net 17,169 11,015 12,206 (238) 40,152
Advances receivable--subsidiaries 46,064 - - (46,064) -
Inventories 31,903 15,611 13,341 (1,550) 59,305
Income taxes and prepaid expenses 5,954 1,272 681 - 7,907
--------- -------- ------- --------- --------
Total current assets 101,096 28,019 27,689 (47,852) 108,952
Property and equipment, net 42,097 23,907 8,752 - 74,756
Intangible assets, net 48,617 20,355 2,096 - 71,068
Prepaid pension cost and other 1,545 5,028 21 - 6,594
Investment in subsidiaries 40,039 - 4,088 (44,127) -
--------- -------- -------- --------- --------
Total assets $233,394 $77,309 $42,646 $(91,979) $261,370
======== ======= ======= ======== ========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable, accrued expenses
and other $ 19,529 $10,877 $ 3,953 $ (3) $ 34,356
Advances payable--subsidiaries - 42,739 3,285 (46,024) -
Current maturities of long-term obligations 1,034 1,379 1,504 - 3,917
-------- ------- ------- ---------- --------
Total current liabilities 20,563 54,995 8,742 (46,027) 38,273
Long-term obligations 118,450 1,345 - - 119,795
Retiree benefits and other 15,277 9,973 - - 25,250
Deferred income taxes 3,732 3,124 99 - 6,955
-------- ------- ------- ---------- --------
Total liabilities 158,022 69,437 8,841 (46,027) 190,273
Stockholders' equity
Common Stock 121 485 87 (572) 121
Additional paid-in capital 65,907 15,662 27,173 (42,835) 65,907
Retained earnings (accumulated deficit) 6,431 (8,275) 10,819 (2,544) 6,431
Dividends 2,877 - (2,877) - -
Accumulated other comprehensive loss 36 - (1,397) (1) (1,362)
-------- ------- ------- -------- --------
75,372 7,872 33,805 (45,952) 71,097
-------- ------- ------- -------- --------
Total liabilities and stockholders' equity $233,394 $77,309 $42,646 $(91,979) $261,370
======== ======= ======= ======== ========
</TABLE>
-9-
<PAGE>
<TABLE>
Condensed Consolidating Balance Sheets
December 31, 1998
(In thousands)
<CAPTION>
Non-
Guarantor guarantor
ASR Subsidiaries Subsidiaries Eliminations Consolidated
------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Assets
Current assets:
Cash and cash equivalents $ (17) $ 106 $ 3,364 $ - $ 3,453
Trade receivables, net 18,717 12,315 13,704 (238) 44,498
Advances receivable--subsidiaries 48,543 - - (48,543) -
Inventories 30,108 13,349 11,604 (1,032) 54,029
Income taxes and prepaid expenses 6,216 1,578 643 - 8,437
-------- ------- ------- ---------- ---------
Total current assets 103,567 27,348 29,315 (49,813) 110,417
Property and equipment, net 41,656 24,068 8,941 - 74,665
Intangible assets, net 49,027 20,601 2,183 - 71,811
Prepaid pension cost and other 1,133 4,850 21 - 6,004
Investment in subsidiaries 39,458 - 4,218 (43,676) -
-------- ------- ------ -------- --------
Total assets $234,841 $76,867 $44,678 $(93,489) $262,897
======== ======= ======= ======== ========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable, accrued expenses
and other $ 20,058 $ 9,611 $ 4,568 $ - $ 34,237
Advances payable--subsidiaries - 43,283 4,703 (47,986) -
Current maturities of long-term obligations 1,030 1,380 1,442 - 3,852
-------- ------- ------- -------- --------
Total current liabilities 21,088 54,274 10,713 (47,986) 38,089
Long-term obligations 121,718 1,377 386 - 123,481
Retiree health and insurance benefits and other 15,169 9,994 - - 25,163
Deferred income taxes 3,468 3,040 102 - 6,610
-------- ------- ------- ------ --------
Total liabilities 161,443 68,685 11,201 (47,986) 193,343
-------- ------- ------- -------- --------
Stockholders' equity
Common Stock 121 485 87 (572) 121
Additional paid-in capital 65,905 15,662 27,173 (42,835) 65,905
Retained earnings (accumulated deficit) 4,457 (7,965) 10,058 (2,093) 4,457
Dividends 2,877 - (2,877) - -
Accumulated other comprehensive loss 38 - (964) (3) (929)
-------- ------- ------- -------- -------
73,398 8,182 33,477 (45,503) 69,554
-------- ------- ------- -------- --------
Total liabilities and stockholders' equity $234,841 $76,867 $44,678 $(93,489) $262,897
======== ======= ======= ======== ========
</TABLE>
-10-
<PAGE>
<TABLE>
Condensed Consolidating Statements of Income (Unaudited)
Three Months Ended March 31, 1999
(In thousands)
<CAPTION>
Non-
Guarantor guarantor
ASR Subsidiaries Subsidiaries Eliminations Consolidated
------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Net sales $37,918 $26,228 $14,005 $(7,864) $70,287
Cost of sales 21,581 22,633 10,479 (7,864) 46,829
------- ------- ------- ------- -------
Gross profit 16,337 3,595 3,526 - 23,458
Selling, general and
administrative expenses 10,836 3,013 2,658 - 16,507
Amortization of intangible assets 365 246 36 - 647
------- ------ ------- ------- -------
Operating income 5,136 336 832 - 6,304
Other income (expense):
Equity in earnings (losses) of affiliates 581 - (130) (451) -
Interest expense (2,483) (1,002) 455 - (3,030)
------- ------- ------- ------- -------
Income (loss) before income taxes 3,234 (666) 1,157 (451) 3,274
Income taxes 1,260 (356) 396 - 1,300
------- ------- ------- ------- -------
Net income (loss) $ 1,974 $ (310) $ 761 $ (451) $ 1,974
======= ======= ======= ======= =======
</TABLE>
<TABLE>
Condensed Consolidating Statements of Income (Unaudited)
Three Months Ended March 31, 1998
(In thousands)
<CAPTION>
Non-
Guarantor guarantor
ASR Subsidiaries Subsidiaries Eliminations Consolidated
------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Net sales $32,177 $28,019 $11,317 $(5,002) $66,511
Cost of sales 19,665 23,665 8,675 (5,002) 47,003
------- ------- ------- ------- -------
Gross profit 12,512 4,354 2,642 - 19,508
Selling, general and
administrative expenses 8,183 2,977 2,361 - 13,521
Amortization of intangible assets 372 245 14 - 631
Special charge 731 184 88 - 1,003
------- ------- ------- ------ -------
Operating income 3,226 948 179 - 4,353
Other income (expense):
Equity in earnings of affiliates 325 - 154 (479) -
Interest expense (2,405) (1,008) 368 - (3,045)
------- ------- ------- ------ -------
Income (loss) before income taxes 1,146 (60) 701 (479) 1,308
Income taxes 357 (40) 202 - 519
------- -------- ------- ------ -------
Net income (loss) $ 789 $ (20) $ 499 $ (479) $ 789
======= ======== ======= ====== =======
</TABLE>
-11-
<PAGE>
<TABLE>
Condensed Consolidating Statements of Comprehensive Income (Unaudited)
Three Months Ended March 31, 1999
(In thousands)
<CAPTION>
Non-
Guarantor guarantor
ASR Subsidiaries Subsidiaries Eliminations Consolidated
------ ------------ ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C>
Net income (loss) $1,974 $(310) $761 $(451) $1,974
Other comprehensive loss:
Foreign currency translation adjustments (2) - (433) 2 (433)
------ ----- ---- ----- ------
Comprehensive income $1,972 $(310) $328 $(449) $1,541
====== ===== ==== ===== ======
</TABLE>
<TABLE>
Condensed Consolidating Statements of Comprehensive Income (Unaudited)
Three Months Ended March 31, 1998
(In thousands)
<CAPTION>
Non-
Guarantor guarantor
ASR Subsidiaries Subsidiaries Eliminations Consolidated
------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Net income (loss) $789 $(20) $499 $(479) $789
Other comprehensive income:
Foreign currency translation adjustments - - 88 - 88
---- ---- ---- ----- ----
Comprehensive income $789 $(20) $587 $(479) $877
==== ==== ==== ===== ====
</TABLE>
-12-
<PAGE>
<TABLE>
Condensed Consolidating Statements of Cash Flows (Unaudited)
Three Months Ended March 31, 1999
(In thousands)
<CAPTION>
Non-
Guarantor guarantor
ASR Subsidiaries Subsidiaries Eliminations Consolidated
------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Operating activities
Net cash (used in) provided by
operating activities $2,752 $1,258 $ (79) $ 515 $4,446
Investing activities
Capital expenditures (1,865) (652) (133) - (2,650)
Other (79) - 51 - (28)
Advances from (to) subsidiaries 2,477 - (1,418) (1,059) -
------ ------ ------ ------ -----
Net cash (used in) provided from
investing activities 533 (652) (1,500) (1,059) (2,678)
Financing activities
Repayment of long-term obligations (6,564) (47) (461) - (7,072)
Proceeds from borrowings 3,300 - 137 - 3,437
Proceeds from exercise of stock options 2 - - - 2
Advances from (to) subsidiaries - (544) - 544 -
------ ----- ------ ---- ------
Net cash used in financing activities (3,262) (591) (324) 544 (3,633)
Net increase (decrease) in cash and cash
equivalents 23 15 (1,903) - (1,865)
Cash and cash equivalents, beginning of
period (17) 106 3,364 - 3,453
------ ----- ------ ---- ------
Cash and cash equivalents, end of
period $ 6 $ 121 $1,461 $ - $1,588
====== ====== ====== ==== ======
</TABLE>
-13-
<PAGE>
<TABLE>
Condensed Consolidating Statements of Cash Flows (Unaudited)
Three Months Ended March 31, 1998
(In thousands)
<CAPTION>
Non-
Guarantor guarantor
ASR Subsidiaries Subsidiaries Eliminations Consolidated
------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Operating activities
Net cash (used in) provided by
operating activities $ (274) $1,057 $ 178 $(19) $ 942
Investing activities
Capital expenditures (1,616) (1,105) (235) - (2,956)
Advances from (to) subsidiaries (662) - - 662 -
------ ------ ------ ---- ------
Net cash used in investing activities (2,278) (1,105) (235) 662 (2,956)
Financing activities
Repayment of long-term obligations (3,047) (55) - - (3,102)
Proceeds from borrowings 5,288 - 121 - 5,409
Proceeds from exercise of stock options 73 - - - 73
Advances from (to) subsidiaries - (239) 890 (651) -
------ ------ ------ ---- ------
Net cash provided from (used in)
financing activities 2,314 (294) 1,011 (651) 2,380
Net increase (decrease) in cash and cash
equivalents (238) (342) 954 (8) 366
Cash and cash equivalents, beginning of
period 356 433 637 8 1,434
------ ------- ------- ---- ------
Cash and cash equivalents, end of
period $ 118 $ 91 $1,591 $ - $1,800
====== ======= ====== ===== ======
</TABLE>
-14-
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
General
The following discussion of results of operations and financial condition is
based upon and should be read in conjunction with the consolidated financial
statements of the Company and notes thereto included in this report and the
Registrant's Annual Report on Form 10-K for the year ended December 31, 1998.
Forward-Looking Statements
This report contains forward-looking statements relating to future results of
the Company. Such forward-looking statements are identified by use of
forward-looking words such as "anticipates," "believes," "plans," "estimates,"
"expects," and "intends" or words or phrases of similar expression. These
forward-looking statements are subject to various assumptions, risks and
uncertainties, including but not limited to, changes in political and economic
conditions, demand for the Company's products, acceptance of new products,
technology developments affecting the Company's products and to those discussed
in the Company's filings with the Securities and Exchange Commission.
Accordingly, actual results could differ materially from those contemplated by
the forward-looking statements.
Three Months Ended March 31, 1999 Compared to Three Months Ended March 31, 1998
Net Sales. Net sales for the three months ended March 31, 1999 and 1998, were
$70.3 million and $66.5 million, respectively, an increase of $3.8 million, or
6%.
Razors and Blades. Net sales of our razors and blades segment for the three
months ended March 31, 1999 and 1998, were $44.3 million and $38.7 million,
respectively, an increase of $5.6 million, or 14%.
Net sales of shaving razors and blades for the three months ended March 31, 1999
and 1998, were $29.1 million and $23.5 million, respectively, an increase of
$5.6 million, or 24%. Net sales of domestic value branded shaving products
increased 108%, rebounding from weak sales in the first quarter of 1998,
reflecting sales gains relating to an increase in promotional programs with
several customers and overall increased distribution of the Company's shaving
products. Net sales of domestic private label shaving products decreased 7% due
primarily to reduced promotional support by certain customers. Net sales of
shaving products in international markets increased 9% (net of a 3% negative
impact of unfavorable exchange rates) reflecting stronger sales in certain
markets.
Net sales of blades and bladed hand tools for the three months ended March 31,
1999 and 1998, were $11.6 million and $11.0 million, respectively, an increase
of $0.6 million, or 5%. This growth primarily reflects increased sales of the
Company's Personna(R) brand of products as a result of new distribution gains.
Net sales of specialty industrial and medical blades for the three months ended
March 31, 1999 and 1998, were $3.6 million and $4.2 million, respectively, a
decrease of $0.6 million, or 14%. Sales of specialty industrial products
decreased 33% due primarily to inventory adjustments by certain customers and
mix shifts to lower priced blade products. Additionally, certain of the
Company's distributors experienced increased competition in their serviced niche
markets. Sales of medical products increased 10% due primarily to increased
distribution of products.
Cotton and Foot Care. Net sales of cotton and foot care products for the three
months ended March 31, 1999 and 1998, were $20.6 million and $22.6 million,
respectively, a decrease of $2.0 million or 9%. This decrease results primarily
from issues related to the continuing integration and reorganization of the
Company's cotton operations which have led to delays in shipping products to
customers and in turn reduced promotional activity.
-15-
<PAGE>
Custom Bar Soap. Net sales of the Company's custom bar soap products for the
three months ended March 31, 1999 and 1998, were $5.5 million and $5.2 million,
respectively, an increase of $0.3 million or 6%. This increase results primarily
from increased sales to certain of the Company's pharmaceutical/skin care
customers.
Gross Profit. Gross profit increased $4.0 million to $23.5 million during the
three months ended March 31, 1999, from $19.5 million for the three months ended
March 31, 1998. As a percentage of net sales, gross profit was 33.4% for the
three months ended March 31, 1999, and 29.3% for the three months ended March
31, 1998. Blade margins improved due to favorable product mix, lower material
costs and lower manufacturing costs reflecting the Company's continuing efforts
to reduce manufacturing costs. This improvement in blade margins was somewhat
offset by increased distribution costs and higher manufacturing overheads
resulting primarily from issues related to the continuing integration and
reorganization of the Company's cotton operations, and increased manufacturing
overheads and depreciation expense in the Company's soap operations.
Operating and Other Expenses. Selling, general and administrative expenses were
23.5% of net sales for the three months ended March 31, 1999, compared to 20.3%
for the three months ended March 31, 1998. This increase primarily reflects an
increase in promotional support for the Company's shaving blade products and
increased spending on new product development activities, primarily related to
our three-blade shaving system, Tri-Flexxx(TM) which will be introduced during
the second quarter of 1999. Amortization of goodwill and other intangible assets
was substantially unchanged at $0.6 million for the three months ended March 31,
1999 and 1998. Interest expense was substantially unchanged at $3.0 million for
the three months ended March 31, 1999 and 1998.
In March 1998, the Company recorded a special charge of approximately $1,003,000
related to the shutdown of the Company's cotton operations in Sparks, Nevada and
employee terminations.
As of March 31, 1999, approximately $1.0 million remained as an accrued expense
on our balance sheet related to the Company's special charges, including the
special charge discussed above, which is expected to be substantially paid or
utilized for asset impairment during the remainder of 1999.
The Company's effective income tax rate was 39.7% for the three months ended
March 31, 1999 and 1998, and varies from the United States statutory rate due
primarily to nondeductible goodwill amortization and state income taxes, net of
the federal tax benefit.
Liquidity and Capital Resources
The Company's primary sources of liquidity are cash flow from operations and
borrowings under its revolving credit facility. Net cash provided by operating
activities for the three months ended March 31, 1999, amounted to $4.4 million.
Net cash used in investing activities for the three months ended March 31, 1999,
related primarily to capital expenditures of $2.7 million. Net cash used in
financing activities for the three months ended March 31, 1999, resulted
primarily from net repayments of $3.6 million.
At March 31, 1999, the Company had utilized $18.2 million of its revolving
credit facility and had approximately $31.8 million available for future
borrowings under this facility.
Management believes that the Company's cash on hand, anticipated funds from
operations, and the amounts available to the Company under its revolving credit
facility will be sufficient to cover its working capital, capital expenditures,
debt service requirements and tax obligations as well as support the Company's
growth-oriented strategy for its existing business for at least the next 12
months.
Market Risk
The Company is exposed to various market risk factors such as fluctuating
interest rates and changes in foreign currency rates. These risk factors can
impact our results of operations, cash flows and financial position. We manage
these risks through regular operating and financing activities and periodically
use derivative financial instruments such as foreign exchange option and forward
contracts. These derivative instruments are placed with major financial
institutions and are not for speculative or trading purposes.
-16-
<PAGE>
The following analysis presents the effect on the Company's earnings, cash flows
and financial position as if the hypothetical changes in market risk factors
occurred on March 31, 1999 and March 31, 1998. Only the potential impacts of our
hypothetical assumptions are analyzed. The analysis does not consider other
possible effects that could impact our business.
Interest Rate Risk
At March 31, 1999, the Company carried $123.7 million of outstanding debt on its
books, with $17.5 million of that total held at variable interest rates. Holding
all other variables constant, if interest rates hypothetically increased or
decreased by 10%, for the three months ended March 31, 1999 and 1998, the impact
on earnings, cash flow and financial position would not be material. In
addition, if interest rates hypothetically increased or decreased by 10% on
March 31, 1999, with all other variables held constant, the fair market value of
our $100.0 million 9 7/8% Series B Senior Notes would increase or decrease by
approximately $5.0 million.
Foreign Currency Risk
The Company sells to customers in foreign markets through our foreign operations
and through export sales from our plants in the U.S. These transactions are
often denominated in currencies other than the U.S. dollar. Our primary currency
exposures are the Euro, British Pound Sterling, Canadian Dollar and Mexican
Peso.
The Company limits its foreign currency risk by operational means, mostly by
locating its manufacturing operations in those locations where it has
significant exposures in major currencies. The Company has entered into currency
option contracts to minimize the risk of foreign currency fluctuations. The
value of these contracts at March 31, 1999 was not material to the Company's
earnings, cash flow and financial position.
Merger
On February 12, 1999, RSA Holdings Corporation and RSA Acquisition Corporation,
which are affiliates of J.W. Childs Equity Partners II, L.P. ("J.W. Childs"),
entered into a merger agreement with the Company. Pursuant to the merger
agreement, as amended on April 8, 1999, RSA Acquisition has made an offer to
purchase all of the outstanding shares of common stock of the Company at a
purchase price of $14.20 per share, upon the terms and subject to the conditions
set forth in the offer to purchase ("the Stock Tender Offer"). The aggregate
purchase price, excluding transaction costs, to be paid for the common stock
purchased in the Stock Tender Offer, assuming all of the common stock (on a
fully diluted basis) is tendered, including the redemption of stock options, is
approximately $173.6 million. The Stock Tender Offer is conditioned upon, among
other conditions, there being validly tendered and not withdrawn, prior to the
expiration date of the Stock Tender Offer, a number of shares of common stock
which constitutes more than 50% of the voting power (determined on a fully
diluted basis) of all the equity securities of the Company. The Stock Tender
Offer expires on April 23, 1999.
The merger agreement provides that, following the completion of the Stock Tender
Offer, RSA Acquisition will be merged with and into the Company (the "Merger").
Following the Merger, the Company will continue as the surviving corporation and
will become a direct, wholly owned subsidiary of RSA Holdings, which will be
wholly owned by J.W. Childs, its affiliates and Company management. Closing for
the Merger is expected to occur in late April 1999.
In connection with the Merger, the Company has made an offer to purchase (the
"Note Tender Offer") all $100.0 million aggregate principal amount of its 9 7/8%
Series B Senior Notes due August 1, 2005 (the "Existing Notes"). In conjunction
with the Note Tender Offer, the Company has also solicited consents to eliminate
substantially all of the covenants contained in the indenture relating to the
Existing Notes. Any tender of Existing Notes pursuant to the Note Tender Offer
will also be a grant of consent with respect to such Existing Notes. The Note
Tender Offer expires on April 26, 1999.
Upon completion of the above transactions, as currently contemplated, the
Company expects it would have had approximately $227.2 million of indebtedness
outstanding as of March 31, 1999 as compared to historical indebtedness
outstanding as of March 31, 1999 of $123.7 million. The Company also expects
that as a result of
-17-
<PAGE>
the application of purchase accounting the Company's depreciation expense and
amortization of intangible assets will increase. In addition, certain fees and
expenses to be incurred relating to the above transactions will be reflected
either as components of the cost of the transactions or as an expense (including
the net cost to redeem stock options) in the period in which the transactions
are completed. The expenses to be incurred in connection with the above
transactions are expected to have a material impact on results of operations in
the period in which the transactions are completed.
Upon consummation of the Merger, The Jordan Company, as advisor to the
transaction, will receive a fee of $2.5 million.
Contingencies
Refer to Note H - Contingencies to the Notes to Condensed Consolidated Financial
Statements for a discussion of legal contingencies.
New Accounting Standards
In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133, "Accounting for Derivative Instruments
and Hedging Activities" ("FAS 133"). FAS 133 establishes standards for
accounting and disclosure of derivative instruments. This new standard is
effective for fiscal quarters of fiscal years beginning after June 15, 1999. The
implementation of this new standard is not expected to have a material effect on
our consolidated results of operations or financial position.
Year 2000 Computer Issues
The Year 2000 issue is the result of computer programs being written using two
digits rather than four to define the applicable year, as well as hardware
designed with similar constraints. Some of our computer programs and hardware
that have date sensitive functions may recognize a date using "00" as the year
1900 rather than the year 2000. This could result in a system failure or
miscalculations causing disruptions in operations including, among other things,
a temporary inability to process transactions, receive invoices, make payments
or engage in normal business transactions.
We are taking action to resolve those Year 2000 issues that are under our
control. The overall effort encompasses our razors and blades, cotton and foot
care and custom bar soap business segments and covers international as well as
domestic sites. We are centrally monitoring and controlling the effort; however,
there are designated representatives at each affiliate and subsidiary location
with responsibility for resolving site-specific Year 2000 issues. Following is a
description of the six-phase approach we are using:
(1) Assessment - Identify and inventory all information technology and
non-information technology system components that are possible sources of
Year 2000 issues and assess the criticality of non-compliant systems in
order to establish priorities for replacement or repair.
(2) Strategy - Determine the nature and extent of Year 2000 issues and select a
remediation strategy (i.e., renovate by modifying existing system, upgrade
to a later version of the system, replace with a new system, or retire the
affected component). After the strategy has been selected, develop project
plans to address non-compliant systems, beginning with the most critical
systems.
(3) Remediation - Execute project plans to resolve issues with non-compliant
systems.
(4) Testing - Perform testing to evaluate effectiveness of the corrective
actions taken or to confirm compliance of systems that have been certified
by third parties.
(5) Implementation - Implement the renovated, upgraded, and replaced
system components into the production environment.
-18-
<PAGE>
(6) Contingency Planning - Continue monitoring readiness and complete
necessary contingency plans.
We have completed the Assessment and Strategy phases for substantially all of
our information technology and non-information technology system components.
Our most mission-critical system is the "Corporate ERP" system, which is a
widely available software package that we have moderately customized. Eleven of
our fifteen manufacturing, packaging and distribution sites utilize the
Corporate ERP system to process orders, control manufacturing
planning/work-order processing, distribute products, manage financial activities
and report financial results. The eleven sites using the Corporate ERP system
include corporate headquarters, U.S. and Mexican razors and blades sites, all
cotton and foot care facilities, and all custom bar soap facilities. The third
party vendor has responded that all of its software modules in use at American
Safety Razor and our subsidiaries are Year 2000 ready. In addition, the most
frequently utilized system functions have been tested by our users, including
the internally developed system customizations.
We are currently linked with 152 customers for exchange of documents using the
Corporate EDI (electronic data interchange) system. Our EDI software has been
upgraded to a Year 2000 compliant version that is now capable of supporting ANSI
standard version 4010, which provides for a 4 digit year and is the version
which many of our EDI customers are adopting prior to the Year 2000. EDI
transactions with a 2 digit year have also been tested and will continue to be
supported for those customers who elect not to convert to a 4 digit year.
Approximately 45% of the 152 EDI customers have now been implemented on 4010.
Testing with EDI customers will continue through the remainder of 1999.
All personal computers are being analyzed and tested to determine whether any
remediation is required. We expect that the analysis and testing process will be
complete by June 1999 and that all personal computers will be Year 2000 ready by
December 31, 1999.
Our U.S., Canada and U.K. payroll systems are Year 2000 compliant and we expect
all of our remaining international payroll systems will be compliant by the end
of 1999.
We are also assessing the Year 2000 readiness of non-information technology
systems and equipment which may include embedded technology such as
micro-controllers. Our manufacturing, assembly, and packaging machines,
operating in each of our razors and blades, cotton and foot care and custom bar
soap segments, are scheduled to be Year 2000 compliant by the end of the second
quarter of 1999.
Our "worst-case" scenario at the present time is the disruption of business
operations as the result of supplier Year 2000 related failures, which would
impair their ability to adequately provide us with products or services. Our
business processes depend on our material suppliers as well as our
infrastructure suppliers in areas such as electricity, water, gas,
communications and transportation. Year 2000 related failures by suppliers could
adversely affect business operations including payroll, manufacturing processes,
product distribution, material ordering, customer-order processing and other
support functions dependent on the affected supplier. While we have a limited
ability to test and control our suppliers' and other third parties' Year 2000
readiness, we are contacting major suppliers and other critical third parties to
obtain information as to their Year 2000 readiness. Razors and blades and cotton
and foot care suppliers were surveyed regarding Year 2000 issues and all key
suppliers have indicated they plan to be compliant during 1999. The custom bar
soap business is scheduling a meeting with its top twenty suppliers during the
first half of 1999 for a Year 2000 readiness review.
Considering the number of internal and external systems which we directly or
indirectly use, it is likely that there will be instances of failure that could
cause disruptions in business processes. The likelihood of failures in
infrastructure systems and in the supply chain cannot be estimated and therefore
the impact of these failures on business operations is uncertain. If we or any
critical third party supplier does not complete necessary upgrades as planned,
the Year 2000 issue may have a material impact on us.
Necessary contingency plans are scheduled to be developed, beginning in July
1999, for any internal systems that are not compliant by the end of June 1999.
Also, contingency plans will be developed by December 1999, as needed, to
address the risk of business disruption due to supplier Year 2000 issues. As
part of contingency planning, we will consider a number of options to mitigate
risk, including building additional inventory prior to year 2000, establishing
manual backup processes and arranging for alternate suppliers.
-19-
<PAGE>
Since most of our Year 2000 issues are being addressed through normal planned
upgrades, incremental external Year 2000 costs are expected to be minimal,
approximating $115,000. To date, the Company has spent approximately $70,000, of
which approximately $35,000 was spent during the first quarter of 1999. The
remaining balance of $45,000 is planned to be spent during the second quarter of
1999.
Readers are cautioned that forward-looking statements contained in this
discussion of Year 2000 issues should be read in conjunction with our
disclosures under the heading "Forward-Looking Statements" above.
Inflation
Inflation has not been material to our operations within the periods presented.
Item 3. Quantitative and Qualitative Disclosure of Market Risk
The information called for by this item is provided under the captions "Market
Risk", "Interest Rate Risk" and "Foreign Currency Risk" under Part I, Item 2 -
Management's Discussion and Analysis of Financial Position and Results of
Operations.
PART II, OTHER INFORMATION
Item 1. Legal Proceedings
The information called for by this item is provided in Note H -
Contingencies to Notes to Condensed Consolidated Financial Statements under
Part I, Item 1. - Financial Statements
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits - Exhibit 27 - Financial Data Schedule
b. Reports on Form 8-K: On February 24, 1999, the Registrant filed a
report on Form 8-K reporting that the Registrant entered into an
Agreement and Plan of Merger with RSA Holdings Corp. and RSA
Acquisition Corp., each an indirect, wholly-owned subsidiary of the
private investment firm J. W. Childs Associates, Inc.
-20-
<PAGE>
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 thereunto duly authorized.
AMERICAN SAFETY RAZOR COMPANY
April 22, 1999 By /s/William C. Weathersby
- -------------- ---------------------------
Date William C. Weathersby
President
April 22, 1999 By /s/Thomas G. Kasvin
- -------------- ----------------------------
Date Thomas G. Kasvin
-21-
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements included in the Form 10-Q of American Safety Razor Company
for the quarter ended March 31, 1999, and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<CIK> 0000750339
<NAME> AMERICAN SAFETY RAZOR COMPANY
<MULTIPLIER> 1000
<CURRENCY> US DOLLARS
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<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<EXCHANGE-RATE> 1
<CASH> 1588
<SECURITIES> 0
<RECEIVABLES> 40152
<ALLOWANCES> 0
<INVENTORY> 59305
<CURRENT-ASSETS> 108952
<PP&E> 126985
<DEPRECIATION> 52229
<TOTAL-ASSETS> 261370
<CURRENT-LIABILITIES> 38273
<BONDS> 119795
0
0
<COMMON> 121
<OTHER-SE> 70976
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</TABLE>
