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 quarterly period ended March 31, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________________ to ___________________
Commission File number 1-4982
PARKER-HANNIFIN CORPORATION
(Exact name of registrant as specified in its charter)
OHIO 34-0451060
(State or other (IRS Employer
jurisdiction of Identification No.)
incorporation)
17325 Euclid Avenue, Cleveland, Ohio 44112
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (216) 531-3000
Indicate by check mark whether 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, and (2) has been subject to such
filing requirements for the past 90 days.
Yes X . No .
Number of Common Shares outstanding at March 31, 1994 48,784,789
The Exhibit Index appears on sequential page 14.
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PARKER-HANNIFIN CORPORATION
INDEX
Page No.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statement of Income -
Three Months and Nine Months Ended
March 31, 1994 and 1993 3
Consolidated Balance Sheet -
March 31, 1994 and June 30, 1993 4
Consolidated Statement of Cash Flows -
Nine Months Ended March 31, 1994
and 1993 5
Business Segment Information by Industry -
Three Months and Nine Months Ended
March 31, 1994 and 1993 6
Notes to Consolidated Financial Statements 7-8
Item 2. Management's Discussion and Analysis
of Financial Condition and Results
of Operations 9-12
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 13
EXHIBIT 11 - Computation of Earnings per Common Share* 15
*Numbered in accordance with Item 601 of Regulation S-K.
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PART I - FINANCIAL INFORMATION
<TABLE>
<CAPTION>
PARKER-HANNIFIN CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(Dollars in thousands, except per share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
March 31, March 31,
1994 1993 1994 1993
<S> <C> <C> <C> <C>
Net sales $ 677,353 $ 607,225 $ 1,876,990 $ 1,804,075
Cost of sales 537,964 492,620 1,517,163 1,461,322
Gross profit 139,389 114,605 359,827 342,753
Selling, general and administrative expenses 78,417 73,785 221,257 226,211
Provision for business restructuring activities 11,369 5,601 18,074 9,546
Impairment of long-term assets 35,483 35,483
Income from operations 14,120 35,219 85,013 106,996
Other income (deductions):
Interest expense (7,791) (11,598) (29,608) (34,830)
Interest and other income, net 297 1,877 3,405 3,807
Loss on disposal of assets (16,839) (23) (16,776) (163)
(24,333) (9,744) (42,979) (31,186)
Income (loss) before income taxes
and extraordinary item (10,213) 25,475 42,034 75,810
Income taxes 8,870 10,541 30,991 30,172
Income (loss) before extraordinary item (19,083) 14,934 11,043 45,638
Extraordinary item - extinguishment of debt 4,207
Net income (loss) $ (19,083) $ 14,934 $ 6,836 $ 45,638
Earnings per share before extraordinary item $ (.39) $ .31 $ .23 $ .94
Earnings per share $ (.39) $ .31 $ .14 $ .94
Cash dividends per common share $ .25 $ .24 $ .73 $ .72
See accompanying notes to consolidated financial statements.
</TABLE>
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<TABLE>
<CAPTION>
PARKER-HANNIFIN CORPORATION
CONSOLIDATED BALANCE SHEET
(Dollars in thousands)
March 31, June 30,
1994 1993
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 70,253 $ 159,985
Accounts receivable, net 383,328 354,338
Inventories:
Finished products 228,265 236,160
Work in process 177,804 191,957
Raw materials 74,387 71,591
480,456 499,708
Prepaid expenses 14,735 13,934
Deferred income taxes 42,142 28,478
Total current assets 990,914 1,056,443
Plant and equipment 1,587,130 1,569,349
Less accumulated depreciation 883,732 833,293
703,398 736,056
Other assets 163,521 171,091
Total assets $ 1,857,833 $ 1,963,590
LIABILITIES
Current liabilities:
Notes payable $ 69,633 $ 86,641
Accounts payable, trade 131,726 125,127
Accrued liabilities 248,495 215,569
Accrued domestic and foreign taxes 45,816 40,917
Total current liabilities 495,670 468,254
Long-term debt 267,552 378,476
Pensions and other postretirement benefits 169,545 157,513
Deferred income taxes 7,616 17,349
Other liabilities 7,454 9,098
Total liabilities 947,837 1,030,690
SHAREHOLDERS' EQUITY
Serial preferred stock, $.50 par value;
authorized 3,000,000 shares; none issued
Common stock, $.50 par value; authorized
150,000,000 shares; issued 49,265,074 shares at
March 31 and 49,265,074 shares at June 30 24,633 24,633
Additional capital 164,026 164,430
Retained earnings 777,328 806,033
Deferred compensation related to guarantee
of ESOP debt (31,367) (36,764)
Currency translation adjustment (13,841) (10,533)
920,779 947,799
Less treasury shares, at cost: 480,285 shares at
March 31 and 663,701 shares at June 30 (10,783) (14,899)
Total shareholders' equity 909,996 932,900
Total liabilities and shareholders' equity $ 1,857,833 $ 1,963,590
See accompanying notes to consolidated financial statements.
</TABLE>
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<TABLE>
<CAPTION>
PARKER-HANNIFIN CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
Nine Months Ended
March 31,
1994 1993
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 6,836 $ 45,638
Adjustments to reconcile net income to net cash
provided by operations:
Net effect of extraordinary loss 4,207
Depreciation 80,819 80,237
Amortization 4,491 3,091
Deferred income taxes (35,664) (6,766)
Foreign currency transaction loss 2,727 249
Loss on sale of plant and equipment 170 350
Provision for restructuring 1,811 3,263
Impairment losses on long-term assets 52,422
Changes in assets and liabilities:
Accounts receivable (41,106) (5,276)
Inventories 21,923 26,682
Prepaid expenses 1,086 1,620
Other assets (2,086) (1,364)
Accounts payable, trade 10,178 (9,335)
Accrued payrolls and other compensation (5,129) (6,840)
Accrued domestic and foreign taxes 10,524 8,531
Other accrued liabilities 35,472 11,428
Pensions and other postretirement benefits 11,756 11,158
Other liabilities (1,624) (2,125)
Net cash provided by operating activities 158,813 160,541
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions (excluding cash of $2,548 in 1994) (30,006) (4,258)
Capital expenditures (65,325) (60,952)
Proceeds from sale of plant and equipment 4,366 2,979
Proceeds from disposition of business 3,205
Other 2,480 (3,208)
Net cash used in investing activities (85,280) (65,439)
CASH FLOWS FROM FINANCING ACTIVITIES
Exercise of stock options 3,711 1,748
Proceeds from (payments of) notes payable, net (12,042) 8,756
Proceeds from long-term borrowings 4,000 6,654
Payments of long-term borrowings (115,311) (15,768)
Extraordinary loss on early retirement of debt (6,922)
Dividends (35,542) (34,881)
Net cash used in financing activities (162,106) (33,491)
Effect of exchange rate changes on cash (1,159) (2,437)
Net (decrease) increase in cash and
cash equivalents (89,732) 59,174
Cash and cash equivalents at beginning of year 159,985 100,053
Cash and cash equivalents at end of period $ 70,253 $ 159,227
See accompanying notes to consolidated financial statements.
</TABLE>
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PARKER-HANNIFIN CORPORATION
BUSINESS SEGMENT INFORMATION BY INDUSTRY
(Dollars in thousands)
(Unaudited)
Parker operates in two industry segments: Industrial and Aerospace. The
Industrial Segment is the largest and includes the International operations.
Industrial - This segment produces a broad range of motion-control and fluid
systems and components used in all kinds of manufacturing, packaging,
processing, transportation, mobile construction, and agricultural and military
machinery and equipment. Sales are direct to major original equipment
manufacturers (OEMs) and through a broad distribution network to smaller OEMs
and the aftermarket.
Aerospace - This segment designs and manufactures products and provides
aftermarket support for commercial, military and general-aviation aircraft,
missile and spacecraft markets. The Aerospace Segment provides a full range
of systems and components for hydraulic, pneumatic, cryogenic and fuel
applications.
<TABLE>
<CAPTION>
Results by Business Segment:
Three Months Ended Nine Months Ended
March 31, March 31,
1994 1993 1994 1993
<S> <C> <C> <C> <C>
Net sales, including intersegment sales
Industrial $ 540,604 $ 450,363 $ 1,463,369 $ 1,343,585
Aerospace 136,823 156,946 413,843 460,739
Intersegment sales (74) (84) (222) (249)
Total $ 677,353 $ 607,225 $ 1,876,990 $ 1,804,075
Income (loss) from operations before corporate
general and administrative expenses
Industrial $ 45,200 $ 28,996 $ 112,732 $ 94,135
Aerospace (20,569) 15,213 1,574 40,322
Total 24,631 44,209 114,306 134,457
Corporate general and administrative
expenses 10,511 8,990 29,293 27,461
Income from operations $ 14,120 $ 35,219 $ 85,013 $ 106,996
See accompanying notes to consolidated financial statements.
</TABLE>
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PARKER-HANNIFIN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Dollars in thousands, except per share amounts
_______________________
1. Management Representation
In the opinion of the Company, the accompanying unaudited
consolidated financial statements contain all adjustments
(consisting of normal recurring accruals and other significant known
adjustments) necessary to present fairly the financial position as
of March 31, 1994, the results of operations for the three and nine
months ended March 31, 1994 and 1993 and cash flows for the nine
months then ended.
2. Extraordinary Item
In November 1993 the Company early-retired $100 million of 9.45
percent debentures due November 1997 through 2016. The resulting
pre-payment premium and unamortized deferred debt costs were
reported as an extraordinary charge.
3. Restatement
On June 30, 1993 the Company changed the reporting period for
subsidiaries outside of North America to provide uniform reporting
on a global basis. The following table presents the fiscal 1993
quarterly results if restated for the change to uniform reporting
periods. For example, the Third Quarter was originally reported as
the period December - February, but restated is the period January - March.
Fiscal 1993 Third Quarter Year-to-Date Fourth Quarter Total Year
As Reported:
Net Sales $ 607,225 $ 1,804,075 $ 685,248 $ 2,489,323
Net Income 14,934 45,638 19,418 65,056
Earnings per
share $ .31 $ .94 $ .40 $ 1.34
If Restated:
Net Sales $ 621,843 $ 1,798,146 $ 640,376 $ 2,438,522
Net Income 18,505 44,727 19,272 63,999
Earnings per
share $ .38 $ .92 $ .40 $ 1.32
4. Earnings per share
Primary earnings per share are computed using the weighted average
number of shares of common stock and common stock equivalents
outstanding during the period. Fully diluted earnings per share are
not presented because such dilution is not material.
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<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
5. Acquisitions
Effective April 1, 1994, the Company purchased Finn-Filter Oy from
Kemira Oy of Helsinki, Finland, one of Scandinavia's leading filter
manufacturers. Sales for this operation were approximately $11.7
million for their most recent fiscal year.
In December 1993 the Company acquired the remaining 60 percent of
LDI Pneutronics, which specializes in advanced-technology pneumatic
valves and components for medical, semiconductor, and analytical
instrumentation markets. In November 1993 the Company acquired the
Electro-pneumatic Division of Telemecanique of France, a leading
European manufacturer of pneumatic products for industrial
applications. The combined purchase price for these businesses,
which will be accounted for by the purchase method, was $31.9
million. Prior year sales for these operations exceeded $51.5
million during their most recent fiscal year.
6. Disposition of business
Effective April 1, 1994 the Company divested nearly all of the
assets related to its Metal Bellows operations, which manufactured
welded and formed bellows, accumulators and other fabricated
assemblies, principally for the aerospace market. The sale resulted
in proceeds of approximately $14 million. Annual sales for this
product line were approximately $30 million.
In December 1992, the company purchased the assets of Gromelle S.A.,
a manufacturer of hydraulic and pneumatic quick couplings in
Annemasse, France. In August 1993, a French Court of Appeals
rescinded the purchase and on September 1 control of the operations
was returned to an administrator. On November 9, 1993 the Court of
Appeals accepted a purchase proposal submitted by another party and
ordered the return of the purchase price to the Company. The effects
of this transaction are not material to the Company's consolidated
financial statements and were reported as a disposition of business
in fiscal 1994.
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<PAGE>
PARKER-HANNIFIN CORPORATION
FORM 10-Q
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FOR THE THREE MONTHS AND NINE MONTHS ENDED MARCH 31, 1994
AND COMPARABLE PERIODS ENDED MARCH 31, 1993
CONSOLIDATED STATEMENT OF INCOME
Net sales increased 11.5 percent for the third quarter and 4.0
percent for the nine-month periods. If Net sales for fiscal 1993
were restated for the change in reporting period described in note 3
to the Consolidated Financial Statements, results would have shown
an increase of 8.9 percent for the quarter and 4.4 percent for the
nine months. The improvement in sales was driven by continuing
increases in the North American Industrial markets and third quarter
increases in the International Industrial business. These
improvements were offset by the continuing lower volume in the
Aerospace business.
Net loss for the quarter was $19.1 million or $.39 per share after
charges totaling $52.7 million, or $1.08 per share to reduce the
book value of certain long-term assets to their current values, and
to recognize the cost of downsizing and relocation activities.
During the same quarter last year, the Company reported Net income
of $14.9 million or $.31 per share, after $5.6 million or $.07 per
share of restructuring charges. However, if Net income were
restated for the change in reporting periods described in note 3 to
the Consolidated Financial Statements, results would have been Net
income of $18.5 million, and earnings per share of $.38. The
difference in the quarterly results between the reported amounts and
the restated comparison reflects the losses incurred by operations
outside of North America in the month of December 1992.
Net income for the nine months decreased $38.8 million to $6.8
million after unusual charges of $56.9 million in 1994 and $6.0
million in 1993. In addition to these charges, an extraordinary
charge of $4.2 million was recorded in the second quarter of fiscal
1994 for the early-retirement of $100 million of 9.45 percent
debentures.
Provision for business restructuring activities: The Industrial
Segment's third quarter restructuring charges were $7.7 million and
included $5.2 million in North America and $2.5 million in
International operations. The North American charge primarily
involved the relocation or consolidation of higher-cost and under-
utilized facilities. Severance charges of $1.3 million were
recorded for the planned reduction of 63 employees in fiscal 1994
and 91 employees in fiscal 1995. Savings for North American
operations as a result of these actions are estimated to be $.8
million in fiscal 1995 and $1.4 million in fiscal 1996. Net cash
outflow is estimated to be $2.6 million in fiscal 1995 and $.9
million in fiscal 1996.
The International Industrial restructuring charges were primarily
for severance costs for 105 employees (38 employees in fiscal 1994
and the remainder in fiscal 1995). The reduction in workforce is
due to lower volume levels and efficiencies in manufacturing and
administrative processes. The savings from these planned actions
are anticipated to be $1.1 million in fiscal 1995 and $1.8 million
in fiscal 1996. Net cash outflow is estimated to be $1.1 million in
fiscal 1995.
The Aerospace business restructuring charges were $3.7 million and
included a workforce reduction of 233 employees (105 in fiscal 1994
and 128 in fiscal 1995) and relocation costs for three facilities
which will result in lower costs and enhanced capacity utilization in
fiscal 1995. The savings from these planned actions are estimated
to be $2.6 million in fiscal 1995 and $5.6 million in fiscal 1996.
Net cash outflow is estimated to be $1.5 million in fiscal 1995 and
$.5 million in fiscal 1996.
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<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
Impairment of long-term assets: The Industrial Segment recognized
the impairment of long-term assets ($6.6 million pretax), primarily
relating to certain machinery and equipment used in operations for
unprofitable product lines in Brazil and Germany. The future cash
flows of these operations were anticipated to be less than the value
of the related assets. The machinery and equipment was written down
to net recoverable value. The effect of these charges will have no
cash impact and will reduce depreciation expense $.7 million per
year in fiscal 1995 and 1996.
The Aerospace Segment recognized impairment losses of $28.9 million
pretax in the third quarter related to the write-down of goodwill
and permanently impaired assets of the continuing operations of the
heat-transfer components product line. The completion of major
contracts and the decline of aerospace markets have caused
anticipated future cash flows to be less than the value of the
assets related to that product line. The goodwill was incurred with
the purchase of this product line in 1987, during a period of heavy
defense spending, and has been determined to be without value in the
current environment. The goodwill was being amortized over 40
years. The effect of this charge will have no cash impact and will
reduce amortization and depreciation expenses $1.6 million per year.
Selling, general and administrative expenses for the quarter were
affected by a $2.2 million charge relating to the impairment of an
investment in a community development fund.
Income from operations as a percent of sales decreased to 2.1
percent from 5.8 percent for the quarter and to 4.5 percent from 5.9
percent for the nine months. Without the effect of business
restructuring and asset impairment, Income from operations as a
percent of sales increased to 9.0 percent from 6.7 percent for the
quarter and to 7.4 percent from 6.5 percent for the nine months.
Cost of sales, as a percent of sales, decreased to 79.4 percent from
81.1 percent for the quarter and to 80.8 percent from 81.0 percent
for the nine months. Increasing production levels in relation to
fixed costs will continue to improve the gross profit margin.
Selling, general and administrative expenses, as a percent of sales,
decreased to 11.6 percent from 12.2 percent for the quarter and to
11.8 percent from 12.5 percent for the nine months. Prior years'
restructuring efforts have contributed to this decrease.
Interest expense decreased 32.8 percent for the quarter and 15.0
percent for the nine months, primarily due to lower borrowings.
Loss on disposal of assets increased $16.8 million during the
quarter, $14.7 million of which was due to impairment of idle
properties. These facilities, primarily Aerospace properties,
became idle due to the downsizing activities. Several facilities
are in very weak real estate markets such as southern California.
Management has decided to sell or lease these facilities in the near
term. The assets were written-down to their estimated recoverable
value based on today's markets.
The Loss on disposal of assets for the current quarter was also
affected by a charge of $1.3 million for the estimated loss on the
sale of the Metal Bellows operations.
Income taxes for the nine months of fiscal 1994 resulted in an
effective tax rate of 73.7 percent, compared to 39.8 percent for
fiscal 1993. This increase was primarily due to receiving no tax
benefit for the charge taken in the current quarter to write down
goodwill and due to increased reserves for minor litigation matters.
Also, Income taxes for the period ended September 30, 1993 included
a cumulative charge of $1.6 million for tax law changes in Germany
and the United States.
Backlog declined to $865.3 million at March 31, 1994 as compared to
$909.2 million the prior year, but increased from the June 30, 1993
backlog of $856.5 million. The decline from a year ago is due to
lower Aerospace orders.
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<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
BUSINESS SEGMENT INFORMATION BY INDUSTRY
Industrial Segment Net sales increased 20.0 percent for the third
quarter, and 8.9 percent for the nine month period. Without the
effect of currency-rate changes, sales would have increased 22.1
percent for the quarter and 12.3 percent for the nine months. If
Net sales for fiscal 1993 were restated for the change in reporting
period described in note 3 to the Consolidated Financial Statements,
results for the Industrial Segment would have shown an increase of
16.3 percent for the quarter and 8.4 percent for the nine months.
During the third quarter, North American Industrial operations set
all-time records for sales and orders. These increased levels are
expected to continue as the markets continue to show recovery.
International Industrial business is still hampered by the recession
overseas, but has shown encouraging signs of recovery during the
last quarter.
Operating income for the Industrial Segment was up 55.9 percent for
the quarter and 19.8 percent for the nine months, even after the
impact of $14.5 million of downsizing and asset impairment charges
in the current quarter as compared to $3.9 million in the prior-year
quarter. Earnings in North America were up substantially for the
quarter and the nine months, while the International business
reported losses. Benefits are being realized in North America as a
result of increased volume and prior years' downsizing activities,
while restructuring continues in the International operations and
lower production levels are not covering fixed costs. Without the
effect of business restructuring and asset impairment, Operating
income as a percent of sales increased to 11.0 percent from 7.3
percent for the quarter and to 9.0 percent from 7.4 percent for the
nine months.
Management expects North American Industrial will continue to
benefit from the ongoing strengths of its markets. Modest signs of
improvement are beginning to be seen in the order entry rates in
Europe. Total Industrial Segment backlog increased 19.7 percent
compared to a year ago and 20.0 percent since June 30, 1993.
Aerospace Segment Net sales were down 12.8 percent for the quarter
and 10.2 percent for the nine months. Operating losses of $20.6
million for the quarter and income of $1.6 million year-to-date were
impacted by the charges ($33.0 million for the quarter and $35.1
million year-to-date) taken for asset impairment and downsizing
activities. Prior-year operating income for the quarter was $15.2
million after restructuring charges of $1.7 million, and for the
nine months was $40.3 million, after restructuring charges of $4.5
million. Without the effect of business restructuring and asset
impairment, Operating income as a percent of sales decreased to 8.8
percent from 10.8 percent for the quarter and to 8.8 percent from
9.7 percent for the nine months. In addition to the charges already
mentioned, the reduced levels of commercial spare parts and military
aftermarket sales has lowered production levels, causing margins to
decline. The Segment has continued to restructure to reflect this
shift in business to current markets.
Management believes the Aerospace business is stabilizing and
expects to maintain favorable margins despite the lower volume.
Backlog for the Aerospace Segment decreased 14.6 percent compared to
a year ago, and 7.1 percent since June 30, 1993.
CONSOLIDATED BALANCE SHEET
Working capital decreased to $495.2 million at March 31, 1994 from
$588.2 million at June 30, 1993 primarily due to the reduction in
cash as a result of the retirement of the $100 million 9.45 percent
debentures. The ratio of current assets to current liabilities
decreased to 2.0 to 1 at March 31, 1994 from 2.3 to 1 at June 30,
1993.
Accounts receivable, net increased $29.0 million since June 30,
1993. The increase would have been $42.6 million without the
effect of changes in foreign exchange rates. Inventories decreased
$19.2 million since June 30, 1993.
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<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
The reduction of goodwill due to the impairment recognized during
the quarter was offset by increases in deferred income taxes and
intangibles associated with new acquisitions. As a result, Other
assets decreased only $7.6 million since June 30, 1993.
The debt to debt-equity ratio, excluding the effect of the ESOP loan
guarantee on both Long-term debt and Shareholders' equity, decreased
to 24.5 percent at March 31, 1994 from 30.6 percent at June 30,
1993. The decrease is the result of the retirement of the $100
million 9.45 percent debentures.
CONSOLIDATED STATEMENT OF CASH FLOWS
Net cash provided by operating activities was $158.8 million for the
nine months ended March 31, 1994, nearly even with the $160.5
million for the same nine months in 1993. Changes in the principal
working capital items - Accounts receivable, Inventories, and
Accounts payable, trade - reflect the use of $9.0 million cash in
fiscal 1994 as compared to providing cash of $12.1 million in fiscal
1993. This change is due to increased Accounts receivable in 1994.
Net cash used in investing activities increased to $85.3 million
from $65.4 million for the nine months ended March 31, 1994 and 1993
as a result of several acquisitions in fiscal 1994.
Net cash used in financing activities was $162.1 million and $33.5
million for the nine months ended March 31, 1994 and 1993,
respectively. This increase of $128.6 million is due to payments of
long-term borrowings and notes payable, as well as the extraordinary
loss for the early-retirement of debt.
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<PAGE>
PARKER-HANNIFIN CORPORATION
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) The following document is furnished as an exhibit and
numbered pursuant to Item 601 of Regulation S-K:
Exhibit 11 - Statement regarding computation of per share
earnings.
(b) The Registrant filed a report on Form 8-K on April 15, 1994
with respect to its April 14, 1994 announcement of its intention to record
a charge of $52.7 million or $1.08 per share in the third quarter, ended
March 31, 1994, to reduce the value of certain long-term assets and to
recognize downsizing and relocation activities.
SIGNATURE
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.
PARKER-HANNIFIN CORPORATION
(Registrant)
Michael J. Hiemstra
Michael J. Hiemstra
Vice President - Finance and Administration
Date: May 12, 1994
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<PAGE>
EXHIBIT INDEX
Sequential
Exhibit No. Description of Exhibit Page
11 Computation of Earnings
Per Common Share 15
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<PAGE>
EXHIBIT 11
<TABLE>
<CAPTION>
PARKER-HANNIFIN CORPORATION
FORM 10-Q
COMPUTATION OF EARNINGS PER COMMON SHARE
(Dollars in thousands, except per share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
March 31, March 31,
1994 1993 1994 1993
<S> <C> <C> <C> <C>
Net income (loss) applicable to common shares $ (19,083) $ 14,934 $ 6,836 $ 45,638
Weighted average common shares outstanding
for the period 48,767,809 48,485,757 48,685,126 48,442,390
Increase in weighted average from dilutive
effect of exercise of stock options 242,638 182,172 236,665 139,442
Weighted average common shares, assuming
issuance of the above securities 49,010,447 48,667,929 48,921,791 48,581,832
Earnings per common share:
Primary $ (.39) $ .31 $ .14 $ .94
Fully diluted (A) $ (.39) $ .31 $ .14 $ .94
</TABLE>
[FN]
(A) This calculation is submitted in accordance with Regulation S-K Item
601(b)(11) although not required for income statement presentation
because it results in dilution of less than 3 percent.
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