<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended May 31, 1999
Commission File Number 1-8803
MATERIAL SCIENCES CORPORATION
(Exact name of Registrant as specified in its charter)
Delaware 95-2673173
(State or other jurisdiction (IRS employer identification
of incorporation or organization) number)
2200 East Pratt Boulevard
Elk Grove Village, Illinois 60007
(Address of principal (Zip code)
executive offices)
Registrant's telephone number, including area code: (847) 439-8270
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 July 13, 1999, there were outstanding 15,261,474 shares of common stock,
$.02 par value.
<PAGE>
MATERIAL SCIENCES CORPORATION
FORM 10-Q
For The Quarter Ended May 31, 1999
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
- -----------------------------
(a) Financial statements of Material Sciences Corporation and Subsidiaries
2
<PAGE>
Consolidated Statements of Income (Unaudited)
Material Sciences Corporation and Subsidiaries
<TABLE>
<CAPTION>
Three Months Ended
May 31,
(In thousands, except per share data) 1999 1998
- ---------------------------------------------------------------------- ----------- -----------
<S> <C> <C>
Net Sales (1) $ 124,993 $ 112,883
Cost of Sales 100,757 93,773
----------- -----------
Gross Profit $ 24,236 $ 19,110
Selling, General and Administrative
Expenses 14,647 13,701
----------- -----------
Income from Operations $ 9,589 $ 5,409
----------- -----------
Other (Income) and Expense:
Interest Income $ (78) $ (71)
Interest Expense 2,495 3,290
Equity in Results of Joint Ventures 481 (45)
Other, Net 84 (428)
----------- -----------
Total Other Expense, Net $ 2,982 $ 2,746
----------- -----------
Income Before Income Taxes and Cumulative Effect of
Accounting Change $ 6,607 $ 2,663
Income Taxes 2,445 1,025
----------- -----------
Income Before Cumulative Effect of Accounting Change $ 4,162 $ 1,638
Cumulative Effect of Accounting Change, Net (6) - 2,207
----------- -----------
Net Income (Loss) (7) $ 4,162 $ (569)
=========== ===========
Basic Net Income (Loss) Per Share:
Income Before Cumulative Effect of Accounting Change
Per Share $ 0.27 $ 0.11
Cumulative Effect of Accounting Change Per Share - 0.14
----------- -----------
Basic Net Income (Loss) Per Share $ 0.27 $ (0.03)
=========== ===========
Diluted Net Income (Loss) Per Share:
Income Before Cumulative Effect of Accounting Change
Per Share $ 0.27 $ 0.11
Cumulative Effect of Accounting Change Per Share - 0.14
----------- -----------
Diluted Net Income (Loss) Per Share $ 0.27 $ (0.03)
=========== ===========
Weighted Average Number of Common Shares Outstanding
Used for Basic Net Income (Loss) Per Share 15,244 15,290
Dilutive Common Stock Options 198 84
----------- -----------
Weighted Average Number of Common Shares Outstanding
Plus Dilutive Common Stock Options 15,442 15,374
=========== ===========
Outstanding Common Stock Options Having No Dilutive Effect 1,698 1,495
=========== ===========
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
Consolidated Balance Sheets
Material Sciences Corporation and Subsidiaries
<TABLE>
<CAPTION>
May 31, February 28,
1999 1999
(In thousands) Unaudited Audited
- ------------------------------------------------------------------------------ ---------- -----------
<S> <C> <C>
Assets:
Current Assets:
Cash and Cash Equivalents $ 2,829 $ 1,227
Receivables:
Trade, Less Reserves of $4,981 and $5,233, Respectively (2) 53,579 52,029
Income Taxes - 968
Prepaid Expenses 3,645 2,180
Inventories 52,140 52,166
Prepaid Taxes 4,889 4,889
---------- -----------
Total Current Assets $ 117,082 $ 113,459
---------- -----------
Property, Plant and Equipment $ 364,843 $ 360,865
Accumulated Depreciation and Amortization (133,465) (126,384)
---------- -----------
Net Property, Plant and Equipment $ 231,378 $ 234,481
---------- -----------
Other Assets:
Investment in Joint Ventures $ 20,514 $ 20,829
Intangible Assets, Net 24,119 24,411
Other 2,343 2,141
---------- -----------
Total Other Assets $ 46,976 $ 47,381
---------- -----------
Total Assets $ 395,436 $ 395,321
========== ===========
Liabilities:
Current Liabilities:
Current Portion of Long-Term Debt $ 2,442 $ 2,429
Accounts Payable 47,268 47,920
Accrued Payroll Related Expenses 9,175 13,891
Accrued Expenses 11,127 8,660
---------- ----------
Total Current Liabilities $ 70,012 $ 72,900
---------- ----------
Long-Term Liabilities:
Deferred Income Taxes $ 19,155 $ 18,434
Long-Term Debt, Less Current Portion 139,232 140,000
Accrued Superfund Liability 3,069 3,087
Other 12,168 11,968
---------- ----------
Total Long-Term Liabilities $ 173,624 $ 173,489
---------- ----------
Shareowners' Equity:
Preferred Stock (3) $ - $ -
Common Stock (4) 344 336
Additional Paid-In Capital 55,623 54,663
Treasury Stock at Cost (5) (12,832) (10,491)
Retained Earnings 108,992 104,830
Accumulated Other Comprehensive Income (7) (327) (406)
---------- ----------
Total Shareowners' Equity $ 151,800 $ 148,932
---------- ----------
Total Liabilities and Shareowners' Equity $ 395,436 $ 395,321
========== ==========
</TABLE>
The accompanying notes are an integral part of these statements.
4
<PAGE>
Consolidated Statements of Cash Flows (Unaudited)
Material Sciences Corporation and Subsidiaries
<TABLE>
<CAPTION>
Three Months Ended
May 31,
(In thousands) 1999 1998
- ------------------------------------------------------------------------------ ------ ---------
<S> <C> <C>
Cash Flows From:
Operating Activities:
Net Income (Loss) $ 4,162 $ (569)
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided
by Operating Activities:
Depreciation and Amortization 7,690 7,883
Provision for Deferred Income Taxes 721 128
Cumulative Effect of Accounting Change, Net - 2,207
Compensatory Effect of Stock Plans 177 96
Other, Net 476 (170)
-------- ---------
Operating Cash Flow Prior to Changes in Assets and Liabilities $ 13,226 $ 9,575
-------- ---------
Changes in Assets and Liabilities:
Receivables $ (1,459) $ 5,526
Income Taxes Receivable 968 697
Prepaid Expenses (1,465) (808)
Inventories 26 3,612
Accounts Payable (652) 1,100
Accrued Expenses (2,249) (787)
Other, Net 261 (253)
-------- ---------
Cash Flow from Changes in Assets and Liabilities $ (4,570) $ 9,087
-------- ---------
Net Cash Provided by Operating Activities $ 8,656 $ 18,662
-------- ---------
Investing Activities:
Capital Expenditures, Net $ (3,973) $ (3,224)
Investment in Joint Ventures (68) (352)
Other (708) (184)
-------- ---------
Net Cash Used in Investing Activities $ (4,749) $ (3,760)
-------- ---------
Financing Activities:
Net Proceeds (Payments) Under Lines of Credit $ (600) $ 50,600
Payments of Debt (155) (64,929)
Purchase of Treasury Stock (2,341) -
Sale of Common Stock 791 511
-------- ---------
Net Cash Used in Financing Activities $ (2,305) $ (13,818)
-------- ---------
Net Increase in Cash $ 1,602 $ 1,084
Cash and Cash Equivalents at Beginning of Period 1,227 3,625
-------- ---------
Cash and Cash Equivalents at End of Period $ 2,829 $ 4,709
======== =========
</TABLE>
The Changes in Assets and Liabilities for the three months ended May 31, 1999
and 1998, are net of assets and liabilities acquired.
The accompanying notes are an integral part of these statements.
5
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MATERIAL SCIENCES CORPORATION
The data for the three months ended May 31, 1999 and 1998 have not been audited
by independent public accountants but, in the opinion of the Company, reflect
all adjustments (consisting of only normal, recurring adjustments) necessary for
a fair presentation of the information at those dates and for those periods.
The financial information contained in this report should be read in conjunction
with the Company's 1999 Annual Report to Shareowners and Annual Report on Form
10-K. Certain prior year amounts have been reclassified to conform with the
fiscal 2000 presentation.
(1) During the three month periods ending May 31, 1999 and 1998, the Company
derived approximately 13.8% and 12.3%, respectively, of its sales from fees
billed to the Partnership by a subsidiary of the Company for operating the
Walbridge, Ohio facility.
(2) Includes trade receivables due from the Partnership of $2,167 at May 31,
1999 and $1,897 at February 28, 1999. Trade receivables also include
amounts due from Innovative Specialty Films, LLC of $278 as of May 31, 1999
and $452 as of February 28, 1999.
(3) Preferred Stock, $1.00 Par Value; 10,000,000 Shares Authorized; 1,000,000
Designated Series B Junior Participating Preferred; None Issued.
(4) Common Stock, $.02 Par Value; 40,000,000 Shares Authorized; 16,863,232
Shares Issued and 15,401,384 Shares Outstanding as of May 31, 1999 and
16,783,084 Shares Issued and 15,571,336 Shares Outstanding as of February
28, 1999.
(5) Treasury Stock at Cost; 1,461,848 Shares as of May 31, 1999 and 1,211,748
Shares as of February 28, 1999. On December 20, 1996, the Company's Board
of Directors authorized the repurchase of up to one million shares of the
Company's common stock, of which 523,100 shares were purchased through
February 28, 1999. Repurchases will be made from time to time in the open
market or through privately negotiated purchases, as the Company may
determine. During the first quarter of fiscal 2000, the Company repurchased
250,100 shares at an average purchase price of $9.36 per share.
(6) In April 1998, the American Institute of Certified Public Accountants
issued Statement of Position ("SOP") 98-5, "Reporting on the Costs of
Start-Up Activities," which the Company adopted effective March 1, 1998.
The SOP requires costs of start-up activities and organization costs to be
expensed as incurred. The effect of the adoption of SOP 98-5 was to record
a non-cash charge of $2,207, net of taxes, for the cumulative effect of a
change in accounting principle to expense costs that had previously been
capitalized prior to March 1, 1998.
6
<PAGE>
(7) Comprehensive Income:
<TABLE>
<CAPTION>
Three Months Ended May 31,
---------------------------
1999 1998
---- ----
<S> <C> <C>
Net Income (Loss) $ 4,162 $ (569)
Other Comprehensive Income:
Foreign Currency Translation Adjustments 79 (234)
--------- ---------
Comprehensive Income (Loss) $ 4,241 $ (803)
========= =========
</TABLE>
(8) Business Segments:
The Company reports segment information based on how management
disaggregates its businesses for evaluating performance and making
operating decisions. The Company's three segments are: Coated Products and
Services, Engineered Materials and Specialty Films. Corporate represents
unallocated general corporate expenses. The net sales on a geographic basis
are not material. Information concerning the Company's business segments in
the first quarter of fiscal 2000 and 1999 was as follows:
<TABLE>
<CAPTION>
Three Months Ended May
31,
-----------------------------
1999 1998
---------- ----------
<S> <C> <C>
Net Sales
---------
Coated Products and Services $ 94,118 $ 84,173
Engineered Materials 19,107 17,611
Specialty Films 12,120 11,691
Eliminations (352) (592)
---------- ----------
$ 124,993 $ 112,883
========== ==========
Income from Operations
----------------------
Coated Products and Services $ 7,067 $ 4,166
Engineered Materials 2,971 1,550
Specialty Films 2,014 985
Corporate and Eliminations (2,463) (1,292)
---------- ----------
$ 9,589 $ 5,409
========== ==========
</TABLE>
7
<PAGE>
MATERIAL SCIENCES CORPORATION
FORM 10-Q
For The Quarter Ended May 31, 1999
PART I. FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis of Financial Condition and Results
-----------------------------------------------------------------------
of Operations
- -------------
RESULTS OF OPERATIONS
- ---------------------
Net sales in the first quarter of fiscal 2000 increased 10.7% to $124,993 from
$112,883 in the same period last fiscal year, as all business segments
contributed to the growth. The Company's first quarter gross profit margin was
19.4% as compared with 16.9% in the prior first quarter. The increase in gross
profit margin was due to higher sales volume, lower material costs, favorable
product mix, as well as improved operating efficiencies. Selling, general and
administrative ("SG&A") expenses were 11.7% of net sales in the first quarter of
fiscal 2000 versus 12.1% in the same period last year. The decrease in SG&A
percentage was due mainly to the increase in the sales volume. During the first
three months of fiscal 2000, income from operations improved 77.3% to $9,589 as
compared with $5,409 last fiscal year.
During fiscal 1999, the Company implemented the 1998 Long-Term
Incentive/Leverage Stock Awards Program (see Note 11 in the Company's 1999
Annual Report to Shareowners). Under generally accepted accounting priniciples,
the award price will be fixed based on the closing price on the measurement date
(the date the price has traded at or above a certain performance level which was
set higher than the market price on the date of grant). During the second
quarter of fiscal 2000, the price reached the first performance level. The
Company will be required to recognize a pro rata portion of compensation expense
totaling approximately $1,300 during the second quarter of fiscal 2000.
The Company's three principal business segments are Coated Products and
Services, Engineered Materials and Specialty Films. The Coated Products and
Services segment includes the coil coating, hot-dip galvanizing and
electrogalvanizing product groups. This segment provides galvanized and
prepainted products and services primarily to the building and construction,
automotive and appliance markets. The Engineered Materials segment includes the
laminates and composites product group. This segment combines layers of metal
and other materials designed to meet specific customer requirements for the
automotive, lighting, appliance and computer disk drive markets. The Specialty
Films segment provides solar control and safety window film, as well as
industrial films used in a variety of products.
Coated Products and Services
Net sales of Coated Products and Services during the first quarter of fiscal
2000 grew 11.8% to $94,118 from $84,173 in the same quarter last year. The
increase is primarily due to a
8
<PAGE>
significant growth in shipments to the building and construction, automotive and
appliance markets. Income from operations for Coated Products and Services
increased to $7,067, a 69.6% increase from $4,166 in the prior year. Higher
volumes, including significant sales to ISPAT Inland Inc., lower material costs,
favorable product mix and improved operating efficiences all contributed to the
growth.
Effective as of June 30, 1998, the Company and a subsidiary of Bethlehem Steel
Corporation ("BSC") each have a 50% ownership interest in Walbridge Coatings
("Partnership"), which owns or leases and operates an electroplating facility in
Walbridge, Ohio. The original term (12 years ending June 30, 1998) of the
Partnership was extended to December 31, 2001. In addition, the Partnership
entered into a long-term toll processing arrangement with ISPAT Inland Inc. (a
former partner) through December 31, 2001. Effective as of January 1, 1999, the
Partnership agreements were restructured to provide for a decrease in pricing to
BSC in exchange for various "make whole" opportunities for the Company related
to third party sales and a portion of the line time rights allocated to the
Company in calendar 2000 and 2001. Significant first quarter sales to ISPAT
Inland Inc. (deemed to be third party sales after certain thresholds are
reached) offset the price reductions to BSC, resulting in improvements in income
from operations.
BSC and another integrated steel mill currently are negotiating agreements to
convert an existing electrogalvanizing facility into a state-of-the-art
automotive hot-dip galvanizing plant. If such negotiations are successful, MSC
expects the other steel mill to purchase a portion of BSC's interest in the
Partnership in order to obtain a source for electroplating services. This could
improve the likelihood of full utilization of the Partnership's facility.
Engineered Materials
During the first quarter of fiscal 2000, sales of Engineered Materials increased
8.5% to $19,107 compared with $17,611 last fiscal year. Significant increases in
shipments of brake damper materials to both the original equipment manufacturer
("OEM") and replacement markets contributed to the growth. Income from
operations for the first quarter improved 91.7% to $2,971 from $1,550 in fiscal
1999 mainly due to favorable product mix, material cost reductions and improved
manufacturing efficiences.
Specialty Films
Sales of Specialty Films products increased 3.7% to $12,120 in the first three
months of fiscal 2000 compared with $11,691 in the same period last year.
Strong gains were made in the window film markets with increased shipments of
high performance automotive, safety and other window films. On October 15,
1998, a subsidiary of the Company formed Innovative Specialty Films, LLC ("ISF")
for the research and development, manufacture and sale of sputtered film.
Comparable sales for the first quarter, excluding sputtered film sales made
through the ISF joint venture, increased 15.6% versus the prior year's first
quarter. Income from operations for Specialty Films for the first quarter was
$2,014, a 104.5% increase from $985 last year. The increase was due to higher
sales volume, improved operating efficiences, as well as royalty income as a
result of the ISF agreement.
9
<PAGE>
Total Other (Income) and Expense, Net and Income Taxes
Total other (income) and expense, net was expense of $2,982 in the first quarter
of fiscal 2000 compared with $2,746 of expense for the first three months of
fiscal 1999. Interest expense decreased $795 due to significantly lower debt
levels, as well as favorable changes in variable interest rates. In addition,
Equity in Results of Joint Ventures was expense of $481 for the first quarter of
this fiscal year compared with income of $45 last year. The change is due to a
decline in third party sales (other than ISPAT Inland Inc.) by the Partnership,
terminations of certain Partnership revenues from BSC and ISPAT Inland Inc.
after certain financing matured on June 30, 1998 and expenses related to the ISF
joint venture commencing operations in January 1999. MSC's effective income tax
rate decreased to 37.0% in the first quarter of fiscal 2000 compared with 38.5%
in the first quarter of fiscal 1999, primarily due to the benefit of state
income tax credits.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
During the first quarter of fiscal 2000, MSC generated $8,656 of cash from
operating activities compared to $18,662 in the first quarter last year. The
decrease in cash generation is due mainly to the significant improvements in
working capital made in the prior year's first quarter, slightly offset by
higher income in the first quarter of fiscal 2000. Earnings before interest,
taxes, depreciation and amortization ("EBITDA") increased to $16,714 for the
first quarter of fiscal 2000 compared with $13,765 for the same quarter last
year. MSC's capital expenditures during the first quarter of fiscal 2000 were
$3,973 compared with $3,224 in the same period last fiscal year.
MSC's total debt decreased as of May 31, 1999, to $141,674 from $142,429 as of
fiscal 1999 year end. As of May 31, 1999, the Company maintains a committed line
of credit totaling $90,000. There was $17,000 outstanding under this line of
credit as of May 31, 1999, versus $14,200 as of February 28, 1999. The Company
has executed letters of credit totaling $4,740 against these lines, leaving
available lines of credit of $68,260 as of May 31, 1999. The Company also
maintains a $10,000 uncommitted line of credit. There was $6,600 outstanding
under this line of credit as of May 31, 1999 as compared with $10,000 as of
fiscal year end. The Company believes that its cash flow from operations,
together with available financing and cash on hand will be sufficient to fund
its working capital needs, capital expenditures, stock repurchase program and
debt amortization.
On December 20, 1996, the Company's Board of Directors authorized the repurchase
of up to one million shares of the Company's common stock, of which 523,100
shares were purchased through February 28, 1999. Repurchases will be made from
time to time in the open market or through privately negotiated purchases, as
the Company may determine. During the first quarter of fiscal 2000, the Company
repurchased 250,100 shares at an average purchase price of $9.36 per share.
The Company has a capital lease obligation, which was $2,310 as of May 31, 1999,
relating to a facility that the Company subleases to the Partnership. In
addition, the Company is contingently responsible for 50% of ISF's financing
requirements. As of May 31, 1999, ISF's debt was $3,044 compared with $2,736 as
of February 28, 1999.
10
<PAGE>
MSC continues to participate in the implementation of settlements with the
government for the clean-up of various Superfund sites. For additional
information, refer to MSC's Form 10-K for the fiscal year ended February 28,
1999.
YEAR 2000
- ---------
The Year 2000 issue exists because many computer systems and applications,
including those embedded in equipment and facilities, use two-digit rather than
four-digit date fields to designate an applicable year. Any of the Company's
systems or applications that have time-sensitive software may recognize a date
using "00" as the year 1900 rather than the year 2000, which could result in a
system failure or miscalculations. Incomplete or untimely resolution of the Year
2000 issue by the Company or its critically important suppliers or customers
could have a materially adverse impact on the Company's business, operations or
financial condition.
To mitigate this risk, the Company has established a company-wide initiative to
identify, evaluate and address Year 2000 issues. Included within the scope of
this initiative are the operational and financial information technology
systems, embedded systems contained in machinery and equipment and other end-
user computing resources and building systems, such as security, elevator and
heating and cooling systems. In addition, the project includes a review of the
Year 2000 compliance efforts of key supplier and other principal business
partners.
Work is progressing in the following phases: inventory, assessment, remediation,
testing, deployment and monitoring. Although the pace of the work varies among
the segments and the phases often are conducted in parallel, the inventory and
assessment phases have been substantially completed as of May 31, 1999. The
remediation and testing phases are in progress and are expected to be completed
during the third quarter of fiscal 2000. Under the Company's Year 2000 plan,
each of its segments has established target dates for remediation and testing of
critical systems and applications.
The Company cannot guarantee that third parties, on whom it depends for
essential supplies and services, will convert their critical systems and
processes in a timely manner. Failure or delay by any of these parties could
significantly disrupt the business. However, the Company has established a
supplier compliance letter program and is working with key suppliers and
partners to minimize such risks.
The total expected cost of Year 2000 compliance (including replacement of major
systems in the normal course of business) is estimated to range from $4,600 to
$5,000, of which approximately $3,619 has been incurred as of May 31, 1999. The
timing of the expenses may vary and are not, necessarily, indicative of the
readiness efforts or progress to date.
The Company believes the key risk factors associated with Year 2000 are those it
cannot directly control, primarily the readiness of its key suppliers,
distributors and partners. The Company has initiated on-going communications
with these third parties to determine their Year 2000 compliance status and
their progress toward Year 2000 readiness. The Company is in the process of
following up with those critical third parties that did not respond to the
supplier compliance letter.
The development and documentation of contingency plans are in progress and will
continue to be assessed throughout the remainder of the calendar year.
Contingency plans include
11
<PAGE>
sourcing alternatives for single source suppliers, developing business
resumption plans for all of the Company's segments and evaluating alternative
manual processes.
Forward-looking statements contained in this filing are qualified by the
cautionary language described in Part II, Item 7 of the Company's 1999 Annual
Report on Form 10-K, filed with the SEC pursuant to the Securities Exchange Act
of 1934, as amended.
12
<PAGE>
MATERIAL SCIENCES CORPORATION
FORM 10-Q
For the Quarter Ended May 31, 1999
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
- -----------------------------------------
(a) 27 Financial Data Schedule
(b) Reports on Form 8-K
-------------------
No reports on Form 8-K were filed during the quarter for which
this report is filed.
13
<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, in Elk Grove Village, State of Illinois,
on the 13th day of July, 1999.
MATERIAL SCIENCES CORPORATION
By: /s/ Gerald G. Nadig
-------------------------------------
Gerald G. Nadig
Chairman, President
and Chief Executive Officer
By: /s/ James J. Waclawik, Sr.
--------------------------------
James J. Waclawik, Sr.
Vice President,
Chief Financial Officer
and Secretary
14
<PAGE>
MATERIAL SCIENCES CORPORATION
Quarterly Report on Form 10-Q
Index to Exhibits
Sequentially
Exhibit Number Description of Exhibit Numbered Page
- -------------- ---------------------- -------------
27 Financial Data Schedule (1)
(1) Appears only in the electronic filing of this report with the Securities
and Exchange Commission.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED STATEMENTS OF INCOME AND CONSOLIDATED BALANCE SHEETS AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> FEB-29-2000
<PERIOD-START> MAR-01-1999
<PERIOD-END> MAY-31-1999
<CASH> 2,829
<SECURITIES> 0
<RECEIVABLES> 53,579
<ALLOWANCES> 4,981
<INVENTORY> 52,140
<CURRENT-ASSETS> 117,082
<PP&E> 364,843
<DEPRECIATION> 133,465
<TOTAL-ASSETS> 395,436
<CURRENT-LIABILITIES> 70,012
<BONDS> 139,232
0
0
<COMMON> 344
<OTHER-SE> 151,456
<TOTAL-LIABILITY-AND-EQUITY> 395,436
<SALES> 124,993
<TOTAL-REVENUES> 124,993
<CGS> 100,757
<TOTAL-COSTS> 100,757
<OTHER-EXPENSES> 14,647
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,495
<INCOME-PRETAX> 6,607
<INCOME-TAX> 2,445
<INCOME-CONTINUING> 4,162
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,162
<EPS-BASIC> 0.27
<EPS-DILUTED> 0.27
</TABLE>
