<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (Fee Required)
For the fiscal year ended December 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (No Fee Required)
For the transition period from to
Commision file number 1-5259
PITT-DES MOINES, INC.
(Exact name of registrant as specified in its charter)
Pennsylvania 25-0729430
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3400 Grand Avenue, Pittsburgh, Pennsylvania 15225
(Address of principal executive offices) (Zip Code)
412-331-3000
(Registrant's telephone number, including area code)
Securities Registered Pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
- ------------------- -----------------------------------------
Common Stock, no par value American Stock Exchange
Securities Registered Pursuant to Section 12(g) of the Act: None
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, and (2) has been subject to such filing requirements
for the past 90 days. Yes X No
-- --
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K [ ].
The aggregate market value of the registrant's voting stock held by non-
affiliates was at least $56,853,896 on February 29, 1996, based upon the average
between the highest and lowest sales prices of the registrant's Common Stock as
reported in the consolidated transactions reporting system.
Common Stock outstanding as of February 29, 1996 . . . . .2,323,633 shares.
Documents Incorporated By Reference:
Certain portions of the documents of the Registrant listed below have been
incorporated by reference into the indicated parts of this Annual Report on Form
10-K:
Proxy Statement anticipated to be dated April 1, 1996..Part III, Items 10-13
Annual Report to Stockholders for fiscal year ended December 31, 1995 . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Part I and Part II
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<PAGE>
PART I
Item 1. Business
General
Pitt-Des Moines, Inc. and its subsidiaries (PDM or the Company) began
conducting business in 1892. PDM was incorporated in Pennsylvania on February
14, 1916. The Company's principal executive offices are located at 3400 Grand
Avenue, Pittsburgh, Pennsylvania 15225, telephone number (412) 331-3000.
Effective with the disposition of CVI's operations during the fourth quarter
of 1994 (see Discontinued Operation note accompanying the consolidated financial
statements), the Company is comprised of three business segments: Engineered
Construction Division, Steel Construction and Steel Service Centers. Each
segment is a profit center except the Steel Construction business segment which
is divided into three profit centers as noted below.
A summary of the Company's products and services by business segment is set
forth below.
Engineered Construction Division
In 1994, the Engineered Construction Division was reorganized into three
project groups: Water, Industrial, and International and Technology. These
market groups provide:
a) The capability to design, fabricate and erect many types of facilities
and structures; services offered include research and design, material
selection, preparation of detailed drawings, shop fabrication, field
erection and subcontract management.
b) The capability to design, fabricate and erect elevated and flat bottom
water storage tanks for water service and fire protection requirements
and treatment tanks for the purification, filtration and softening of
water. The principal purchasers of the Company's water storage tanks and
wastewater treatment facilities are government agencies and private
industry.
c) The capability to design, fabricate and erect oil and chemical storage
tanks used for storing crude oil, petroleum, gasoline and other
petroleum derivatives and chemicals. The Company has developed and
patented certain systems, parts and sealing devices which help to reduce
the hazards of fire and explosion from the stored products, as well as
to decrease air pollution and vapor loss. Additionally, the Company
fabricates and erects various vessels used in the processing of a
variety of oil and chemical products. The oil and chemical tanks,
sealing devices and process vessels are produced principally for the
petroleum, petrochemical, chemical and food processing industries as
well as government agencies.
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<PAGE>
Item 1. Business (Cont'd)
d) The capability to fabricate and erect miscellaneous plate work which
includes penstocks and breechings, stacks and stack liners, scrubbers,
absorbers, flow conductors and heat exchangers for utilities and private
industry.
e) The capability to design, fabricate and erect high speed wind tunnels,
altitude test chambers, hydrospace test facilities and high vacuum and
thermal test facilities for use in connection with energy, aerospace and
defense research.
f) The capability to design and build supercritical fluid extraction
facilities for the food processing industry.
g) The capability to design and build anaerobic digesters for the
wastewater treatment industry.
Steel Construction
On September 1, 1994, the Company acquired the bridge fabricating assets of
Phoenix Steel, Inc., located in Eau Claire, Wisconsin. These assets were
combined with the bridge fabricating assets of Hartwig Mfg. Corp. (which was
merged with and into the Company on December 31, 1994) to form the PDM
Bridge Division. PDM Bridge, PDM Strocal, Inc. and PDM Chicago Steel
Construction comprise the three profit centers of Steel Construction which
provide:
a) The capability to fabricate and erect structural steel for commercial,
institutional and public sector buildings for government agencies,
private developers and general contractors.
b) The capability to fabricate structural steel for new bridges and
fabricate and erect structural steel for bridge rehabilitation for
government agencies and general contractors.
Steel Service Centers
The Steel Service Centers operate six steel service centers and three
culvert facilities located in the West and Midwest regions of the United
States. This Division processes and distributes to the end users, a general
line of carbon steel products including plates, sheets, structural shapes,
bars, tubes, pipe and other miscellaneous metal products. This Division also
manufactures and markets to the end users, corrugated metal culvert pipe and
accessories. The Steel Service Centers' primary markets include steel
fabricators, original equipment manufacturers and the mining, logging,
agricultural and road construction industries.
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<PAGE>
Item 1. Business (Cont'd)
Steel Service Centers (Cont'd)
The Company and the industry as a whole deem the maintenance of adequate
levels of inventory to be integral to the Service Center business. The
Company believes that it has adequate levels of inventory on hand to meet
current and anticipated customer demand.
Other
Several large companies compete nationally in some product lines with the
Company and there are several local and regional companies that compete in
certain product lines in specific geographic areas. The majority of the
Company's business is secured through open competitive bidding or through direct
negotiations with industry or government agencies. Competition is based
primarily on performance including the ability to provide design, engineering
and on-site field construction services in a cost-effective, timely manner. The
Steel Service Centers' volume of business is based on the price, delivery and
credit terms, and first stage preprocessing operations offered to its customers
as well as its reputation.
Earned revenue was $461 million in 1995, compared with $408 million in 1994
and $324 million in 1993. For further financial information refer to
Consolidated Financial Statements in PDM's 1995 Annual Report to Stockholders
which are incorporated herein by reference.
The principal raw materials essential to the Company's business are steel,
alloys and other metal plates and structural sections. The Company procures
these raw materials from various domestic and foreign sources including, the
mills of USX Corporation, Bethlehem Steel Corporation, Northwestern Steel and
Wire Company, Nucor Steel, British Steel and Mitsubishi International
Corporation.
The Company has a license and technical assistance agreement with Roediger,
a German corporation, which gives the Company exclusive rights in North America
and other selected countries worldwide to use the Roediger technology, a process
which utilizes anaerobic digestion in the treatment of wastewater. Revenues to
date from this technology have not been material to the Company.
Some components of the other products made and erection techniques used by
the Company are covered by patents owned or licensed by the Company. None of
these are deemed to be material to the Company from an overall financial
viewpoint.
The Company had a backlog of uncompleted contracts of $183 million on
December 31, 1995 compared to $194 million on December 31, 1994. Substantially
all backlog is expected to be completed during 1996.
Factors such as the type and scope of operations in progress at any given
time, including weather conditions at field sites, create fluctuations in the
employment level at PDM. On December 31, 1995, the Company employed 2,082
persons, of which 635 were salaried personnel and 1,447 were hourly personnel.
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<PAGE>
Item 1. Business (Cont'd)
The financial information for business segments is included in the Business
Segment Information section in PDM's 1995 Annual Report to stockholders, which
section is incorporated herein by reference.
Item 2. Properties
Operations of the Company are conducted at both owned and leased properties.
In addition, certain owned properties of the Company are leased to third party
tenants. The following table indicates each of the Company's facilities in the
United States by: segment, location, type of facility, year operations began,
and square footage of property owned or leased on December 31, 1995:
<TABLE>
<CAPTION>
YEAR
TYPE OF OPERATIONS SQUARE
LOCATION FACILITY BEGAN FOOTAGE
<S> <C> <C> <C>
Engineered Construction Division
Birmingham, Alabama (1) Warehouse and office 1994 4,000
Fresno, California Toolhouse 1963 52,140
Clive, Iowa Fabrication plant and office 1955 176,537
Des Moines, Iowa Toolhouse 1900 29,000
Pittsburgh, Pennsylvania Office and toolhouse 1908 98,776
Warren, Pennsylvania Fabrication plant 1959 125,960
Franklin, Tennessee Toolhouse 1977 28,220
Hitchcock, Texas (2) Toolhouse 1994 5,000
Provo, Utah Fabrication plant 1959 154,950
Steel Construction
Stockton, California Fabrication plant and office 1987 142,300
Chicago, Illinois Fabrication plant and office 1987 520,800
Eau Claire, Wisconsin Fabrication plant and office 1994 309,500
Wausau, Wisconsin Fabrication plant 1991 160,460
Steel Service Centers
Fresno, California Warehouse and office 1955 112,800
Santa Clara, California Warehouse and office 1947 108,528
Stockton, California Warehouse and office 1955 191,493
Cedar Rapids, Iowa Warehouse and office 1976 66,800
Sparks, Nevada Warehouse and office 1974 64,936
Tualatin, Oregon Warehouse and office 1964 31,620
Spanish Fork, Utah Warehouse and office 1977 74,280
Arlington, Washington (3) Warehouse and office 1993 13,965
</TABLE>
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Item 2. Properties (Cont'd)
<TABLE>
<CAPTION>
YEAR
TYPE OF OPERATIONS SQUARE
LOCATION FACILITY BEGAN FOOTAGE
<S> <C> <C> <C>
Idle Holdings, Including Plant and Property (4)
Sacramento, California Land 1966 --
Des Moines, Iowa Fabrication plant and office 1900 339,100
Baltimore, Maryland Land 1960 --
Hilliard, Ohio Fabrication plant and office 1971 179,000
Pittsburgh, Pennsylvania Office 1908 10,234
Provo, Utah Office 1959 15,731
Wausau, Wisconsin Office 1991 4,120
</TABLE>
__________
(1) Company leases land from outside third party. Lease will expire March 31,
1999.
(2) Company leases land and building from outside third party. Lease will expire
July 1, 1997.
(3) Company leases land from outside third party. Lease will expire January 31,
2003.
(4) Company pursues the sale or development of all idle facilities and regularly
evaluates similar opportunities for facilities not fully utilized.
The properties listed above are utilized by the Company's business segments
as indicated. The Company's production capacity is adequate for its present
needs. The Company believes that its properties have been adequately maintained,
are generally in good condition and are suitable for the Company's business as
now conducted.
Item 3. Legal Proceedings
There are various claims and legal proceedings against the Company arising
in the normal course of business. Although counsel is unable to predict with
certainty the ultimate outcome, management and counsel believe the Company has
significant and meritorious defenses to any claims, and intend to pursue them
vigorously.
As previously reported, in May 1984, Washington Public Power Supply System
(WPPSS) filed a complaint against the Company and its surety in the United
States District Court for the Eastern District of Washington. All of WPPSS'
claims against the Company and its surety have been dismissed.
On November 3, 1993, an accident occurred at the construction site of a new
United States Post Office in Chicago where the Company's Steel Construction
business segment was in the process of fabricating and erecting the steel
structure of the building. Two men were killed and five seriously injured when a
portion of the erected steel collapsed. An investigation is being conducted by
the Federal Occupational Safety and Health Administration (OSHA) and the Justice
Department as required by OSHA law. See Accrued Liabilities note accompanying
the consolidated financial statements in PDM's 1995 Annual Report to
Stockholders, which note is incorporated herein by reference.
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<PAGE>
Item 3. Legal Proceedings (Cont'd)
The Company's operations, including idle facilities and other property, are
subject to and affected by federal, state and local laws and regulations
regarding the protection of the environment. The Company accrues for
environmental costs where such obligations are either known or considered
probable and can be reasonably estimated.
The Company is participating as a potentially responsible party (PRP) at
three different sites pursuant to proceedings under the Comprehensive
Environmental Response, Compensation and Liability ACT (CERCLA). Other parties
have also been identified as PRP's at the sites. Investigative and/or remedial
activities are ongoing. The Company believes, based upon information presently
available to it, that such future costs will not have a material effect on the
Company's financial position, results of operations or liquidity. However, the
imposition of more stringent requirements under environmental laws or
regulations, new developments or changes regarding site cleanup costs or the
allocation of such costs amount PRP's or a determination that the Company is
potentially responsible for the release of hazardous substances at sites other
than those currently identified, could result in additional costs.
Management believes it is improbable that the ultimate outcome of any matter
currently pending against the Company will materially affect the financial
position of the Company.
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable
Executive Officers of the Registrant
Information regarding executive officers of the Registrant is presented in
Part III following and incorporated herein by reference.
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<PAGE>
PART II
Information for Items 5, 6 and 7 is included in PDM's 1995 Annual Report to
Stockholders and is incorporated herein by reference (and except for these
sections, and sections incorporated herein by reference in Items 1 and 8 of this
report, PDM's Annual Report to Stockholders is not deemed to be filed as part of
this report):
<TABLE>
<CAPTION>
ANNUAL REPORT
TO STOCKHOLDERS
ITEM NO. TITLE SECTION/TITLE
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<S> <C> <C>
Item 5. Market for Registrant's Common Equity Common Stock Information
and Related Stockholder Matters included in Stockholders'
Reference section
Item 6. Selected Financial Data Five-Year Selected
Financial Data
Item 7. Management's Discussion and Analysis Management's Discussion
of Financial Condition and Results of and Analysis
Operations
Item 8. Financial Statements and Supplementary Data
</TABLE>
The financial statements consisting of Consolidated Statements of Income,
Consolidated Statements of Financial Condition, Consolidated Statements of Cash
Flows, Consolidated Statements of Stockholders' Equity, Notes to Consolidated
Financial Statements, and Business Segment Information are included in the
Consolidated Financial Statements section of PDM's 1995 Annual Report to
Stockholders, which are incorporated herein by reference. The report of
independent auditors on PDM's consolidated financial statements is in the
Reports of Independent Auditors and Management section of PDM's 1995 Annual
Report to Stockholders which is incorporated herein by reference.
The unaudited Two-Year Quarterly Results of Operations in PDM's 1995 Annual
Report to Stockholders is incorporated herein by reference.
Item 9. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure
Not applicable
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<PAGE>
PART III
Item 10. Directors and Executive Officers of the Registrant (1)
Regarding the directors of the Registrant, reference is made to the
information set forth under the caption "Election of Directors" in the Company's
definitive Proxy Statement anticipated to be dated April 1, 1996 (Proxy
Statement) which information is incorporated herein by reference.
The principal executive officers of the Company and their recent business
experience are as follows:
W. R. Jackson, age 87
Director since 1940;
Chairman Emeritus since 1988; formerly Chairman of the Board since 1971.
Mr. Jackson has been with the Company since 1936.
P. O. Elbert, age 65 (2)
Director since 1988;
Chairman of the Board of the Company since 1990; formerly President of the
Company since 1988 and President, PDM Structural Group since 1987. Mr.
Elbert joined the Company in 1987. Prior to 1987, Mr. Elbert was Vice
Chairman of Chicago Steel Corporation since 1986; formerly a partner of
Elbert and McKee Company since 1984; formerly President and Chief Executive
Officer of Flint Steel Corporation since 1979; and formerly Group Vice
President of Inryco, Inc., a subsidiary of Inland Steel Company since 1969.
Wm. W. McKee, age 57 (3)
Director since 1988;
President and Chief Executive Officer of the Company since 1990; formerly
President, PDM Plate Group since May 1987 and formerly Executive Vice
President, PDM Structural Group since April 1987. Mr. McKee joined the
Company in 1987. Prior to 1987, Mr. McKee was Secretary of Chicago Steel
Corporation since 1986; formerly a partner of Elbert and McKee Company since
1984; formerly a consultant with McKee and Associates since 1983; formerly
President of Hogan Manufacturing since 1980; and formerly President of
Herrick Corporation since 1973.
R. A. Byers, age 48 (3)
Treasurer since 1988 and Vice President, Finance and Administration since
1987; formerly Vice President, Finance since 1984; formerly Controller since
1982; formerly Assistant Controller since 1981; formerly Manager of
Financial Reporting since 1979; and formerly with Ernst & Young LLP for ten
years.
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<PAGE>
Item 10. Directors and Executive Officers of the Registrant (Cont'd)
T. R. Lloyd, age 47 (3)
Secretary and General Counsel since 1990; formerly Senior Attorney of
Buchanan Ingersoll Professional Corporation, since 1989; formerly Vice
President, Secretary and General Counsel for Arch Mineral Corporation since
1984; and formerly Director and Secretary of U.S. Steel Mining Co., Inc.
since 1979.
____________________
(1) Except where otherwise indicated, all references are to positions held with
Pitt-Des Moines, Inc. Each executive officer of the Company is elected
annually by the Board of Directors until his successor is elected and
qualified, and each has served continually as an officer since first
elected.
(2) The Company has a severance agreement with Mr. Elbert.
(3) The Company has agreements with each of Messrs. McKee, Byers and Lloyd
covering, among other things, their positions as executive officers of the
Company after a change of control.
Regarding Section 16 compliance, reference is made to the information set forth
under the caption "Compliance with Section 16 of the Exchange Act" in the
Company's definitive Proxy Statement anticipated to be dated April 1, 1996 which
information is incorporated herein by reference.
Item 11. Executive Compensation
Reference is made to the information set forth under the captions "Board of
Directors and Committees of the Board," "Executive Compensation and Other
Information," "Compensation Committee Interlocks and Insider Participation"
appearing in the Company's Proxy Statement, which information is incorporated
herein by reference; provided, however, that the information set forth under the
captions "Compensation Committee Report on Executive Compensation" and
"Performance Graph" in the proxy Statement shall not be deemed to be soliciting
material or to be "filed" with the Commission or subject to Regulation 14A or
14C (other than as provided in Item 402 of Regulation S-K) or to the liabilities
of Section 18 of the Securities Exchange Act of 1934, as amended.
Item 12. Security Ownership of Certain Beneficial Owners and Management
Reference is made to the information contained under the captions
"Stockholdings of Management" and "Principal Holders of Common Stock" in the
Company's Proxy Statement which information is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions
Reference is made to the information contained under the caption
"Compensation Committee Interlocks and Insider Participation" in the Company's
Proxy Statement which information is incorporated herein by reference.
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PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) 1. Financial Statements
The following consolidated financial statements and Report of
Independent Auditors previously incorporated by reference in Part II,
Item 8 of this report are incorporated herein by reference:
Report of Independent Auditors
Consolidated Statements of Income -- Years Ended December 31, 1995, 1994
and 1993
Consolidated Statements of Financial Condition as of December 31, 1995
and 1994
Consolidated Statements of Cash Flows -- Years Ended December 31, 1995,
1994 and 1993
Consolidated Statements of Stockholders' Equity -- Years Ended December
31, 1995, 1994 and 1993
Notes To Consolidated Financial Statements
2. Financial Statement Schedules
The following consolidated financial statement schedule of Pitt-Des
Moines, Inc. and subsidiaries is included in Item 14(d):
Schedule II. Valuation and Qualifying Accounts for years ended December
31, 1995, 1994 and 1993
All other schedules are omitted because they are not applicable or the
required information is shown in the consolidated financial statements
or notes thereto.
3. Exhibits:
3.1 Articles of Incorporation, as amended to date (filed as Exhibit 3.1 to
the Company's quarterly report on Form 10-Q for the quarter ended
September 30, 1989 and incorporated herein by reference)
3.2 Bylaws, as amended to date (filed as Exhibit 3.2 to the Company's
quarterly report on Form 10-Q for the quarter ended September 30, 1989
and incorporated herein by reference)
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<PAGE>
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(Cont'd)
4.1 Amended and Restated Credit Agreement dated as of June 30, 1992 by and
among Pitt-Des Moines, Inc. and Pittsburgh National Bank, Wells Fargo
Bank, N.A. and American National Bank (filed as Exhibit 4.1 to the
Company's annual report on Form 10-K for the year ended December 31,
1992 and incorporated herein by reference)
4.2 First Amendment dated November 23, 1992 to Credit Agreement filed as
Exhibit 4.1 hereto (filed as Exhibit 4.2 to the Company's annual report
on Form 10-K for the year ended December 31, 1992 and incorporated
herein by reference)
4.3 Second Amendment dated June 10, 1993 to Credit Agreement filed as
Exhibit 4.1 hereto (filed as Exhibit 4.1 to the Company's quarterly
report on Form 10-Q for the quarter ended June 30, 1992 and incorporated
herein by reference)
4.4 Third Amendment dated December 16, 1993 to Credit Agreement filed as
Exhibit 4.1 hereto (filed as Exhibit 4.4 to the Company's annual report
on Form 10-K for the year ended December 31, 1993 and incorporated
herein by reference)
4.5 Fourth Amendment dated June 14, 1994 to Credit Agreement filed as
Exhibit 4.1 hereto (filed as Exhibit 4.1 to the Company's quarterly
report on Form 10-Q for the quarter ended June 30, 1994 and incorporated
herein by reference)
4.6 Fifth Amendment dated December 8, 1994 to Credit Agreement filed as
Exhibit 4.1 hereto (filed as Exhibit 4.6 to the Company's annual report
on Form 10-K for the year ended December 31, 1994 and incorporated
herein by reference)
4.7 Sixth Amendment dated May 31, 1995 to Credit Agreement filed as Exhibit
4.1 hereto (filed as Exhibit 4.1 to the company's quarterly report on
Form 10-Q for the quarter ended June 30, 1995 and incorporated herein by
reference)
10.1* Agreement executed by and between the Company and Wm. W. McKee (filed
as Exhibit 10.1 to the Company's annual report on Form 10-K for
the year ended December 31, 1990 and incorporated herein by
reference)
10.2* Agreement executed by and between the Company and R. A. Byers (filed
as Exhibit 10.1 to the Company's quarterly report on Form 10-Q for
the quarter ended June 30, 1991 and incorporated herein by
reference)
10.3* Agreement executed by and between the Company and T. R. Lloyd (filed
as Exhibit 10.2 to the Company's quarterly report on Form 10-Q for
the quarter ended June 30, 1991 and incorporated herein by
reference)
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<PAGE>
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(Cont'd)
10.4* Management Incentive Plan (filed as Exhibit 10.5 to the Company's
annual report on Form 10-K for the year ended December 31, 1992
and incorporated herein by reference)
10.5* Summary of Company's 1995 Management Incentive Plan (MIP) (filed
herewith)
10.6* Retirement Plan for PDM Outside Directors as amended, effective
May 26, 1994 (filed as Exhibit 10.7 to the Company's annual report
on Form 10-K for the year ended December 31, 1994 and incorporated
herein by reference)
10.7* Retirement Plan for PDM Outside Directors as amended on September
14, 1995, effective May 26, 1994 (filed herewith)
10.8* Stock Option Plan of 1990 (filed as Exhibit 4.01 to the Company's
Registration Statement No. 33-34787 on Form S-8 filed May 7, 1990
and incorporated herein by reference)
10.9* Investment Letter and Registration Rights Agreement dated
September 21, 1993 by and between Pitt-Des Moines, Inc. and
William W. McKee, Jr. (filed as Exhibit 10.1 to the Company's
quarterly report on Form 10-Q for the quarter ended September 30,
1993 and incorporated herein by reference)
10.10* Investment Letter and Registration Rights Agreement dated
September 21, 1993 by and between Pitt-Des Moines, Inc. and
Phillip O. Elbert (filed as Exhibit 10.2 to the Company's
quarterly report on Form 10-Q for the quarter ended September 30,
1993 and incorporated herein by reference)
11 Computation of Per Share Earnings (filed herewith)
13 Those portions of the Annual Report to Stockholders for fiscal
year ended December 31, 1995, which are incorporated herein by
reference (filed herewith)
21 Subsidiaries of Pitt-Des Moines, Inc. (filed herewith)
23 Consent of Independent Auditors, Ernst & Young LLP (filed
herewith)
27 Financial Data Schedule
(b) Reports on Form 8-K:
A Form 8-K dated December 7, 1995 was filed under Item 5.
Other Events.
- ------------------------
* Denotes management contract or compensatory plan or arrangement.
-13-
<PAGE>
Signatures
Pursuant to the requirements of Section 13 or 15(d) 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.
PITT-DES MOINES, INC.
March 27, 1996 By: /s/ Wm. W. McKee
---------------------------------
Wm. W. McKee
President
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signatures Title Date
<S> <C> <C>
Principal Executive Officer:
/s/ Wm. W. McKee President, Chief March 27, 1996
- ------------------------------------ Executive Officer and
Wm. W. McKee Director
Principal Financial and Accounting Officer:
/s/ R. A. Byers Chief Financial Officer March 27, 1996
- ------------------------------------ and Chief Accounting
R. A. Byers Officer
Other Directors:
/s/ J. C. Bates Director March 27, 1996
- ------------------------------------
J. C. Bates
/s/ R. W. Dean
- ------------------------------------
R. W. Dean Director March 27, 1996
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Signatures (Cont'd)
Signatures Title Date
<S> <C> <C>
/s/ P. O. Elbert Director March 27, 1996
- ------------------------------------
P. O. Elbert
/s/ W. R. Jackson Director March 27, 1996
- ------------------------------------
W. R. Jackson
/s/ W. R. Jackson, Jr. Director March 27, 1996
- ------------------------------------
W. R. Jackson, Jr.
/s/ W. E. Lewellen Director March 27, 1996
- ------------------------------------
W. E. Lewellen
/s/ A. J. Paddock Director March 27, 1996
- ------------------------------------
A. J. Paddock
/s/ J. W. Robinson Director March 27, 1996
- ------------------------------------
J. W. Robinson
/s/ P. J. Townsend Director March 27, 1996
- ------------------------------------
P. J. Townsend
</TABLE>
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<PAGE>
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Pitt-Des Moines, Inc.
<TABLE>
<CAPTION>
Additions Deductions(1)
----------- -------------
Balance at Charged to
Beginning of Costs and Credited Balance at End
Description Period Expenses to Asset of Period
- ----------------------------------- -------------- ----------- --------- ---------
<S> <C> <C> <C> <C>
Deducted from accounts receivable
as allowance for doubtful accounts:
Year ended December 31, 1995 $923,000 $220,000 $275,000 $868,000
Year ended December 31, 1994 $ 975,000 $209,000 $261,000 $923,000
Year ended December 31, 1993 $1,011,000 $911,000 $947,000 $975,000
</TABLE>
- ---------------------
(1) Write-off of accounts deemed to be uncollectible
-16-
<PAGE>
EXHIBIT INDEX
3.1 Articles of Incorporation, as amended to date (filed as Exhibit
3.1 to the Company's quarterly report on Form 10-Q for the quarter
ended September 30, 1989 and incorporated herein by reference)
3.2 Bylaws, as amended to date (filed as Exhibit 3.2 to the Company's
quarterly report on Form 10-Q for the quarter
ended September 30, 1989 and incorporated herein
by reference)
4.1 Amended and Restated Credit Agreement dated as of June 30, 1992 by and
among Pitt-Des Moines, Inc. and Pittsburgh National Bank, Wells Fargo
Bank, N.A. and American National Bank (filed as Exhibit 4.1 to the
Company's annual report on Form 10-K for the year ended December 31,
1992 and incorporated herein by reference)
4.2 First Amendment dated November 23, 1992 to Credit Agreement filed as
Exhibit 4.1 hereto (filed as Exhibit 4.2 to the Company's annual
report on Form 10-K for the year ended December 31, 1992 and
incorporated herein by reference)
4.3 Second Amendment dated June 10, 1993 to Credit Agreement filed as
Exhibit 4.1 hereto (filed as Exhibit 4.1 to the Company's quarterly
report on Form 10-Q for the quarter ended June 30, 1992 and
incorporated herein by reference)
4.4 Third Amendment dated December 16, 1993 to Credit Agreement filed as
Exhibit 4.1 hereto (filed as Exhibit 4.4 to the Company's annual
report on Form 10-K for the year ended December 31, 1993 and
incorporated herein by reference)
4.5 Fourth Amendment dated June 14, 1994 to Credit Agreement filed as
Exhibit 4.1 hereto (filed as Exhibit 4.1 to the Company's quarterly
report on Form 10-Q for the quarter ended June 30, 1994 and
incorporated herein by reference)
4.6 Fifth Amendment dated December 8, 1994 to Credit Agreement filed as
Exhibit 4.1 hereto (filed as Exhibit 4.6 to the Company's annual
report on Form 10-K for the year ended December 31, 1994 and
incorporated herein by reference)
4.7 Sixth Amendment dated May 31, 1995 to Credit Agreement filed as
Exhibit 4.1 hereto (filed as Exhibit 4.1 to the company's quarterly
report on Form 10-Q for the quarter ended June 30, 1995 and
incorporated herein by reference)
10.1 Agreement executed by and between the Company and Wm. W. McKee (filed
as Exhibit 10.1 to the Company's annual report on Form 10-K for the
year ended December 31, 1990 and incorporated herein by reference)
10.2 Agreement executed by and between the Company and R. A. Byers (filed
as Exhibit 10.1 to the Company's quarterly report on Form 10-Q for the
quarter ended June 30, 1991 and incorporated herein by reference)
<PAGE>
EXHIBIT INDEX (Cont'd)
10.3 Agreement executed by and between the Company and T. R. Lloyd (filed
as Exhibit 10.2 to the Company's quarterly report on Form 10-Q for the
quarter ended June 30, 1991 and incorporated herein by reference)
10.4 Management Incentive Plan (filed as Exhibit 10.5 to the Company's
annual report on Form 10-K for the year ended December 31, 1992 and
incorporated herein by reference)
10.5 Summary of Company's 1995 Management Incentive Plan (MIP) (filed
herewith)
10.6 Retirement Plan for PDM Outside Directors as amended, effective May
26, 1994 (filed as Exhibit 10.7 to the Company's annual report on Form
10-K for the year ended December 31, 1994 and incorporated herein by
reference)
10.7 Retirement Plan for PDM Outside Directors as amended on September 14,
1995, effective May 26, 1994 (filed herewith)
10.8 Stock Option Plan of 1990 (filed as Exhibit 4.01 to the Company's
Registration Statement No. 33-34787 on Form S-8 filed May 7, 1990 and
incorporated herein by reference)
10.9 Investment Letter and Registration Rights Agreement dated September
21, 1993 by and between Pitt-Des Moines, Inc. and William W. McKee,
Jr. (filed as Exhibit 10.1 to the Company's quarterly report on Form
10-Q for the quarter ended September 30, 1993 and incorporated herein
by reference)
10.10 Investment Letter and Registration Rights Agreement dated September
21, 1993 by and between Pitt-Des Moines, Inc. and Phillip O. Elbert
(filed as Exhibit 10.2 to the Company's quarterly report on Form 10-Q
for the quarter ended September 30, 1993 and incorporated herein by
reference)
11 Computation of Per Share Earnings (filed herewith)
13 Those portions of the Annual Report to Stockholders for fiscal year
ended December 31, 1995, which are incorporated herein by reference
(filed herewith)
21 Subsidiaries of Pitt-Des Moines, Inc. (filed herewith)
23 Consent of Independent Auditors, Ernst & Young LLP (filed herewith)
27 Financial Data Schedule
<PAGE>
Exhibit 10.5
SUMMARY OF COMPANY'S 1995 MANAGEMENT INCENTIVE PLAN (MIP)
Pitt-Des Moines, Inc.
Under the terms of the MIP, a minimum rate of return of (threshold) on
stockholders' equity must be achieved before bonuses can be awarded. The
threshold for executive officers was established at the after-tax cost of
capital on the assumption that returns in excess of the threshold would
lead to increases in stockholder value. Once this criteria is met, the total
amount of bonus available for distribution to eligible executive officers,
including the Company's Chief Executive Officer ("CEO") under the MIP is based
on a percentage in excess of the minimum return on stockholders' equity.
Individual bonus amounts paid to the Company's executive officers for services
rendered in 1995, including the CEO, were based on a pre-determined percentage
limitation on each individual's base salary (in no case does the applicable
limit exceed 100% of base salary) and the percentage of the overall MIP target
achieved. These pre-determined percentages were established by the Compensation
Committee.
Under the terms of the MIP, the Company's eligible executive officers were
entitled to receive and were awarded bonuses under the MIP for the year
ended December 31, 1995.
<PAGE>
Exhibit 10.7
RETIREMENT PLAN FOR PDM NON-EMPLOYEE DIRECTORS
(Effective for Directors retired or deceased after May 26, 1994.)
DEFINITION
This Retirement Plan is for the benefit of present and future Directors who
resign from the Board of Directors who die while serving as a member of the
Board of Directors, where such a Director has completed five years of service as
a non-employee Director, and does not have a vested right to a benefit under any
pension plan of the Company or any subsidiary of the Company. Such Director
shall be referred to for the purpose of this Pension Plan as a qualifying
Director.
BENEFITS
A Qualifying Director will be entitled to receive a percentage (payable
quarterly after the end of each quarter) of the annual directorship retainer
(excluding fees or retainers for committee membership or for attendance at any
meeting) in effect on the date of his/her resignation or retirement. After five
years of service, the entitlement is 50% and this entitlement will increase 10%
for each completed year of service up to and including 100%. No further increase
in the percentage of entitlement will occur after 10 years of service, and there
is no entitlement if retirement or resignation occurs prior to five years of
service as a Board Member. The retirement benefit will commence with the quarter
in which a qualified Director attains age 65 (or would have attained age 65 in
cases where the benefit is otherwise payable to a Qualified Director's surviving
spouse) and will continue for the life of the director (or the life of a
Qualified Director's surviving spouse pursuant to OTHER PROVISIONS below). Past
service of present Qualifying Directors shall be counted in determining length
of service.
OTHER PROVISIONS
If a Qualifying Director dies while serving on the Board and has a surviving
spouse, 50% of the benefit to which the Qualified Director would then be
entitled to, if the Qualified Director had been retired at time of death, will
be paid to the surviving spouse as long as the surviving spouse lives.
If a Qualifying Director dies while receiving a benefit under this Retirement
Plan, and the Qualifying Director has a surviving spouse at the time of death,
the surviving spouse will receive 50% of the benefit as long as the surviving
spouse lives.
<PAGE>
Exhibit 10.7 (Cont'd)
RETIREMENT PLAN FOR NON-EMPLOYEE DIRECTORS (Cont'd)
INELIGIBILITY FOR BENEFITS
A Director removed for "conduct detrimental" to the Company shall be ineligible
for benefits under this Plan. For the purpose of this Plan, a Director shall be
considered removed for "conduct detrimental" to the Company if in the sole
opinion of no less than 75% of all the Directors of the Board of Directors of
the Company, evidenced by a duly adopted resolution of the Board of Directors,
the removal of such Director from the Board of Directors is the result of
conduct materially and demonstrably injurious to the Company or is the result of
any other conduct that adversely reflects on the Director's fitness to serve on
the Board of Directors.
FUNDING
No funds shall be set aside for the purpose of making payments under this
Retirement Plan and said payments shall be considered as general operating
expense.
ADMINISTRATION
The Plan shall be administered by the Board of Directors and it will decide all
matters involving interpretation and application of the Plan.
AMENDMENTS OR TERMINATION OF PLAN
The Board of Directors shall have the right to amend or terminate this Plan at
any time at its sole discretion. However, no such amendment or termination shall
adversely affect the rights of any Qualifying Director who, at the time of such
amendment or termination, is either receiving benefits pursuant to the terms of
this Plan or who would be eligible to receive such benefits if such Director had
resigned from the Board of Directors immediately prior to such amendment or
termination. This Plan shall not give any Qualifying Director the right to
continue as a Member of the Board of Directors.
EFFECTIVE DATE
This Plan replaces that certain Retirement Plan of PDM Outside Directors which
was effective as to non-employee Directors retired or deceased between October
1, 1987 and May 26, 1994, and is effective for non-employee Directors who die or
retire after May 26, 1994 in accordance with the above terms and conditions.
<PAGE>
Exhibit 11
STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
Pitt-Des Moines, Inc.
<TABLE>
<CAPTION>
Years Ended December 31,
1995 1994 1993
------------ ------------ -----------
<S> <C> <C> <C>
Primary
Average shares outstanding 2,321,527 2,323,651 2,323,645
Dilutive stock options based on
treasury stock method using
average market price 8,815 1,699 2,002
------------ ------------ -----------
2,330,342 2,325,350 2,325,647
============ ============ ===========
Income from continuing operations $13,019,460 $11,979,821 $ 566,979
Income from discontinued operations, net of taxes - 80,362 470,962
------------ ------------ -----------
Net income $13,019,460 $12,060,183 $1,037,941
============ ============ ===========
Income per common share:
Continuing operations $5.58 $5.16 $0.25
Discontinued operations .00 .03 .20
------------ ------------ -----------
Net income per common share $5.58 $5.19 $ .45
============ ============ ===========
Fully Diluted
Average shares outstanding 2,321,527 2,323,651 2,323,645
Dilutive stock options based on treasury stock
method using greater of year-end or average
market price 11,401 1,699 2,002
------------ ------------ -----------
2,332,928 2,325,350 2,325,647
============ ============ ===========
Income from continuing operations $13,019,460 $11,979,821 $ 566,979
Income from discontinued operations, net of taxes - 80,362 470,962
------------ ------------ -----------
Net income $13,019,460 $12,060,183 $1,037,941
============ ============ ===========
Income per common share:
Continuing operations $5.58 $5.16 $0.25
Discontinued operations .00 .03 .20
------------ ------------ -----------
Net income per common share $5.58 $5.19 $ .45
============ ============ ===========
</TABLE>
<PAGE>
Exhibit 13
PORTIONS OF THE 1995 ANNUAL REPORT TO STOCKHOLDERS
Pitt-Des Moines, Inc.
FIVE YEAR
SELECTED
FINANCIAL DATA
<TABLE>
<CAPTION>
Years ended December 31,
- ----------------------------------------------------------------------------------------------------------------------------
(Dollars in thousands, except per share amounts) 1995 1994 1993 1992 1991
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Operating Performance
Earned revenue $461,274 $408,061 $323,707 $355,043 $370,318
Income (loss) from operations 22,077 15,508 (2,689) 4,681 11,323
Net Income (loss):
Continuing operations 13,019 11,980 567 4,080 8,315
Discontinued operations -- 80 471 820 (462)
- ---------------------------------------------------------------------------------------------------------------------------
Net Income $ 13,019 $ 12,060 $ 1,038 $ 4,900 $ 7,853
===========================================================================================================================
Income (loss) per common share:
Continuing operations $ 5.58 $ 5.16 $ 0.25 $ 1.68 $ 3.37
Discontinued operations -- 0.03 0.20 0.34 (0.19)
- ---------------------------------------------------------------------------------------------------------------------------
Net income per common share $ 5.58 $ 5.19 $ 0.45 $ 2.02 $ 3.18
===========================================================================================================================
Financial Position
Total assets $201,136 $214,201 $177,803 $166,074 $176,001
Long-term debt 13,000 22,000 -- -- 2,135
Stockholders' equity 108,942 98,549 88,473 89,678 91,512
Other Information
For the year:
Cash provided (utilized) by operations $ 14,630 $ (2,784) $ (3,767) $ 21,414 $ 13,871
Depreciation expense 5,554 5,037 4,145 4,314 4,178
Capital expenditures 5,304 7,919 3,942 4,491 4,417
Dividends per common share 1.00 0.90 0.90 0.90 0.825
At year end:
Book value per common share $ 46.96 $ 42.44 $ 38.07 $ 38.63 $ 37.36
Employees 2,082 2,257 1,987 2,066 2,285
===========================================================================================================================
</TABLE>
Note: Refer to the Accrued Liabilities and Contingencies Notes accompanying the
Consolidated Financial Statements.
<PAGE>
MANAGEMENT'S
DISCUSSION
AND ANALYSIS
The following discussion and analysis is provided to increase understanding
of, and should be read in conjunction with, the consolidated financial
statements and accompanying notes.
Results of Operations
The Company realized net income of $13.0 million in 1995 compared with $12.0
million in 1994 and $1.0 million in 1993. The related earnings per share were
$5.58 in 1995 compared with $5.19 in 1994 and $.45 in 1993. Earned revenue
increased 13 percent in 1995 compared with 1994 and increased 26 percent in
1994 compared with 1993. Income from operations increased $6.6 million in 1995
when compared with 1994 as a result of the Company's performance particularly
in the steel construction and steel service center markets. During 1994, income
from operations improved $18.2 million to $15.5 million from a loss of $2.7
million in 1993. This change may be attributed to the general economic
conditions in the respective years. In 1994, all of the Company's business
segments improved profitability when compared with 1993 results.
Engineered Construction Division
Earned revenue for the Engineered Construction Division (ECD) was $190.8
million in 1995 compared with $177.3 million and $128.4 million in 1994 and
1993, respectively. ECD's earned revenue represented 41 percent of consolidated
revenues in 1995.
Income from operations of $9.1 million in 1995 decreased $2.1 million when
compared with 1994. This was a direct result of a downturn of activity in
commercial markets where margins tend to be more favorable. However, new
marketing efforts were initiated during 1995 to address these market
conditions, and should have a favorable impact on 1996 results. In 1994, income
from operations of $11.2 million increased $12.9 million when compared with a
loss of $1.7 million in 1993. During 1994, ECD took advantage of the recovering
economy by expanding volume and realizing higher margins on contracts. The loss
in 1993 was attributed to poor economic conditions as the Company's results
normally lag the general economy.
New awards were $174.9 million, $199.0 million and $160.3 million in 1995,
1994 and 1993, respectively. Although new awards were down in 1995, an adequate
backlog level of $93.1 million along with new marketing strategies should
permit this segment to maintain profitability levels in 1996.
Capital expenditures of $2.3 million in 1995 were primarily for construction
and computer equipment. During 1994, expenditures of $3.9 million were for a
new office building, computer and construction equipment. In 1993, plant and
construction equipment expenditures totaled $882,000.
Steel Construction
This segment has seen an increase in earned revenues over the last three
years. In 1993, revenues were $95.8 million which increased to $101.9 million
in 1994, and in 1995 rose to $119.7 million which represented 26 percent of
consolidated revenues. The increase in bridge activity during 1995, offset the
expected deterioration in results for Chicago Steel Construction. During 1994,
the McCormick Place Exhibition Center project accounted for almost 12 percent
of consolidated revenues and dominated activity for this segment. The
substantial completion of the United States Post Office project in Chicago
accounted for 35 percent of this segment's revenues in 1993. For a discussion
of certain potential liabilities which may arise from an accident which
occurred at this project, see "Accrued Liabilities" in the Notes to
Consolidated Financial Statements.
As indicated in "Costs and Estimated Profits on Uncompleted Contracts" in
the Notes to Consolidated Financial Statements, Steel Construction's earned
revenue for 1995 includes approximately $6.0 million relating to an unapproved
change order arising from a dispute over design and specification changes on a
project currently under construction. Negotiations to obtain reimbursement for
this additional work have commenced. Management believes that amounts
recognized will be realized. However, this estimate of recovery could change as
the negotiations continue. As additional facts are learned, the Company may
revise the estimate of potential recovery, which could result in a material
adjustment to the results of operations in future periods.
<PAGE>
MANAGEMENT'S
DISCUSSION
AND ANALYSIS
The most dramatic improvement for Steel Construction over the last three
years has been in operating profitability. In 1993, operating profitability was
$431,000, in 1994 increased to $2.8 million, and in 1995 reached $7.6 million.
The increase in 1995 was attributed to the improvement in profitability of
construction contracts on the West Coast along with this segment's ability to
increase its market share in bridge fabrication. One major contract, as
mentioned earlier, contributed significantly to the increase in profitability
in 1994 when compared to 1993. A non-recurring charge for insurance coverage
deductibles of $2.0 million and uninsured costs were recorded in 1993, thus
reducing profitability.
In 1995, new awards were $126.6 million compared with $92.7 million in 1994
and $121.3 million in 1993. This resulted in backlog levels of $91.3 million,
$82.1 million and $89.0 million for 1993, 1994 and 1995, respectively. With its
current backlog and new contract prospects, management anticipates that Steel
Construction will remain profitable in 1996.
Capital expenditures, exclusive of business acquisitions, were $919,000 in
1995 compared with $661,000 and $1.5 million in 1994 and 1993, respectively.
During the last three years, asignificant portion of capital expenditures were
for purchases of plant and construction equipment.
Steel Service Centers
The Company's Steel Service Centers accounted for 33 percent of consolidated
earned revenues in 1995. Earned revenue was $150.8 million in 1995 compared
with $128.9 million in 1994 and $99.5 million in 1993. This increase in revenue
was primarily the result of this Division's ability to capture additional
market share through competitive pricing.
Operating profitability increased to $11.9 million in 1995, compared with
$7.5 million in 1994. This Division's performance over the past three years has
been the result of strategic expansion plans along with a strong economy on the
West Coast. As a result, it is expected that this segment's continued
improvement in performance will carry over into 1996.
Capital expenditures in 1995 of $2.1 million were for plant equipment.
During 1994 and 1993, capital expenditures of $3.4 million and $1.6 million,
respectively were primarily used for expansions of physical plants, processing
and warehouse equipment and to upgrade the delivery fleet.
Other
Corporate unallocated expenses, consisting primarily of salaries, benefits,
outside professional services, taxes and insurance, were $6.5 million in 1995
compared with $6.0 million and $6.5 million in 1994 and 1993, respectively.
In 1995, the Company's interest income was $1.2 million compared with
$627,000 in 1994 and $540,000 in 1993. Interest income increased in 1995 as a
result of interest bearing long-term notes receivables, related to the
disposition of CVI Incorporated during the fourth quarter of 1994, along with
an increased level of interest earning funds the Company maintained throughout
the year. Interest income increased in 1994 when compared to 1993 reflecting
the rise in interest rates.
The steady rise in interest expense over the last three years was the result
of the Company's increase in net borrowings on its revolving credit facility.
The Company had debt obligations of $13 million and $22 million as of December
31, 1995 and 1994, respectively. However, corresponding with the increase in
interest expense the Company maintained higher levels of net borrowings
throughout 1995 when compared with 1994.
The gain on the sale of assets was $95,000 in 1995 and $3.6 million in 1994.
In 1995, 1994 and 1993, gains on the sale of idle properties were recognized
and additionally in 1994, the Company realized a gain on the sale of PDM Saudi
Arabia Ltd., a joint venture.
The effective income tax rate was 39 percent in 1995 compared with 36
percent in 1994 and 47 percent in 1993. In 1994, the effective tax rate was
favorably impacted by the realization of a tax benefit related to the
previously mentioned sale of a foreign investment. In 1993, the effective tax
rate was adversely impacted as a result of foreign taxes of $81,000 with no
corresponding tax credit.
The Company's operations, including idle facilities and other property, are
subject to federal, state and local laws andregulations regarding protection of
the environment. The Company accrues for environmental costs where such
obligations are either known or considered probable and can be reasonably
estimated.
<PAGE>
MANAGEMENT'S
DISCUSSION
AND ANALYSIS
The Company has been notified it is a potentially responsible party (PRP) at
three waste disposal sites under the Comprehensive Environmental Response,
Compensation and Liability Act (CERCLA). Other parties have also been
identified as PRP's at the sites. Investigative and/or remedial activities
are ongoing.
The Company believes, based upon the information presently available to it,
that such costs will not have a material adverse effect on the Company's
financial position, results of operations or liquidity.
However, the imposition of more stringent requirements under environmental
laws or regulations, changes in site cleanup costs or the allocation of such
costs among PRP's, or a determination that the Company is potentially
responsible for the release of waste or pollutants at sites other than those
currently identified, could result in additional costs.
Inflation and changing prices did not significantly impact the Company
during the last three years.
In October 1995, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation" (SFAS No. 123). SFAS No. 123 establishes financial accounting and
reporting standards for stock-based compensation plans and to transactions in
which an entity issues its equity instruments to acquire goods and services
from nonemployees. The new accounting standards prescribed by SFAS No. 123 are
optional, and the Company may continue to account for its plans under previous
accounting standards. The Company does not expect to adopt the new accounting
standard, and consequently, SFAS No. 123 will not have an impact on the
Company's consolidated results of operations.
In 1996, the Company will adopt the Statement of Financial Accounting
Standards No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to be Disposed Of" (SFAS No. 121). The adoption of SFAS No.
121 will not have a material effect on the Company's financial position or
results of operations.
Liquidity and Capital Resources
The increase in cash flows from operating activities in 1995 when compared
with 1994, is due primarily to decreases in operating assets and liabilities.
The changes in operating assets and liabilities from year to year are affected
by the mix, stage of completion and commercial terms of contracts. The decrease
in cash utilized by investing activities in 1995 compared with 1994 is
primarily attributable to the acquisition of the bridge fabricating assets of
Phoenix Steel Inc., a steel bridge fabricator on September 1, 1994. The total
cost of this acquisition was $13.5 million. Capital expenditures, exclusive of
business acquisitions, in 1995 were $5.3 million compared with $7.9 million and
$3.9 million in 1994 and 1993, respectively. In addition, the Company intends
to continue to pursue beneficial acquisition opportunities. Cash utilized by
financing activities consisted primarily of dividend payments and payment of
debt obligations.
The Company paid cash dividends of $2.3 million ($1.00 per share) in 1995
compared with $2.1 million ($.90 per share) in 1994 and 1993. On February 8,
1996, the Board of Directors declared a 10 percent increase in the quarterly
dividend from $.25 per share to $.27-1/2 per share, and a special year-end extra
dividend of $.20 per share. The payment of future dividends will be evaluated
based on business conditions.
The Company has on hand and access to sufficient sources of funds to meet its
anticipated operating, expansion and capital needs. These sources include the
unused portion of a $40.0 million unsecured revolving credit facility which
matures on December 31, 1997. This facility contains an annual option to renew
for an additional one-year period, subject to lender approval. On December 31,
1995, $13.0 million of borrowings, at 7.1% and $12.5 million of stand-by
letters of credit were outstanding under this agreement. The Company expects
to borrow under the credit facility for working capital requirements in 1996.
<PAGE>
BUSINESS
SEGMENT
INFORMATION
<TABLE>
<CAPTION>
Years ended December 31,
- ------------------------------------------------------------------------------------
1995 1994 1993
- ------------------------------------------------------------------------------------
<S> <C> <C> <C>
Earned Revenue
Engineered Construction Division $190,778,590 $177,337,825 $128,444,623
Steel Construction 119,690,135 101,871,144 95,755,727
Steel Service Centers 150,805,331 128,851,654 99,506,546
- ------------------------------------------------------------------------------------
$461,274,056 $408,060,623 $323,706,896
====================================================================================
Income (Loss) From Operations
Engineered Construction Division $ 9,088,399 $ 11,180,896 $ (1,716,243)
Steel Construction 7,607,683 2,767,438 430,963
Steel Service Centers 11,927,971 7,528,151 5,068,260
Corporate and other (6,547,366) (5,968,768) (6,472,186)
- ------------------------------------------------------------------------------------
$ 22,076,687 $ 15,507,717 $ (2,689,206)
====================================================================================
Identifiable Assets
Engineered Construction Division $ 59,919,222 $ 61,826,921 $ 49,564,994
Steel Construction 69,129,166 75,024,678 48,941,685
Steel Service Centers 40,809,816 41,421,278 33,221,009
Corporate and other 27,361,995 32,371,231 33,904,461
- ------------------------------------------------------------------------------------
Continuing operations 197,220,199 210,644,108 165,632,149
Discontinued operations 3,916,078 3,557,371 12,170,808
- ------------------------------------------------------------------------------------
$201,136,277 $214,201,479 $177,802,957
====================================================================================
Capital Expenditures
Engineered Construction Division $ 2,296,679 $ 3,868,223 $ 881,772
Steel Construction 919,330 660,540 1,493,362
Steel Service Centers 2,065,521 3,375,412 1,561,748
Corporate and other 22,124 14,845 4,684
- ------------------------------------------------------------------------------------
Continuing operations 5,303,654 7,919,020 3,941,566
Discontinued operations -- 23,987 158,920
- ------------------------------------------------------------------------------------
$ 5,303,654 $ 7,943,007 $ 4,100,486
====================================================================================
Depreciation
Engineered Construction Division $ 1,875,229 $ 1,906,768 $ 1,543,513
Steel Construction 2,196,098 1,902,787 1,674,637
Steel Service Centers 1,442,272 1,192,176 883,991
Corporate and other 40,361 35,024 43,244
- ------------------------------------------------------------------------------------
Continuing operations 5,553,960 5,036,755 4,145,385
Discontinued operations 108,227 593,254 631,520
- ------------------------------------------------------------------------------------
$ 5,662,187 $ 5,630,009 $ 4,776,905
====================================================================================
</TABLE>
For the year ended 1995, neither any single customer, nor any customer outside
the United States, accounted for 10 percent or more of total earned revenue.
In 1994, Steel Construction's earned revenue includes $48.3 million related to
the McCormick Place Exhibition Center. In 1993, Steel Construction's earned
revenue includes $39.5 million related to the United States Post Office project.
<PAGE>
CONSOLIDATED
STATEMENTS
OF INCOME
<TABLE>
<CAPTION>
Years ended December 31,
- -------------------------------------------------------------------------------------------------
1995 1994 1993
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Earned revenue $461,274,056 $408,060,623 $323,706,896
Cost of earned revenue 398,731,887 357,639,136 293,377,923
- -------------------------------------------------------------------------------------------------
Gross profit from operations 62,542,169 50,421,487 30,328,973
Selling, general and administrative expenses 40,465,482 34,913,770 33,018,179
- -------------------------------------------------------------------------------------------------
Income (loss) from operations 22,076,687 15,507,717 (2,689,206)
Other income (expense):
Interest income 1,234,367 626,841 540,008
Interest expense (1,927,010) (897,993) (219,752)
Gain on sale of assets 95,044 3,576,760 3,595,414
Miscellaneous, net (223,620) (157,233) (155,047)
- -------------------------------------------------------------------------------------------------
(821,219) 3,148,375 3,760,623
- -------------------------------------------------------------------------------------------------
Income from continuing operations before taxes 21,255,468 18,656,092 1,071,417
Income tax expense 8,236,008 6,676,271 504,438
- -------------------------------------------------------------------------------------------------
Income from continuing operations 13,019,460 11,979,821 566,979
Income from discontinued operations, net of taxes -- 80,362 470,962
- -------------------------------------------------------------------------------------------------
Net income $ 13,019,460 $ 12,060,183 $ 1,037,941
=================================================================================================
Income per common share:
Continuing operations $5.58 $5.16 $0.25
Discontinued operations -- 0.03 0.20
- -------------------------------------------------------------------------------------------------
Net income per common share $5.58 $5.19 $0.45
=================================================================================================
Shares used to calculate income per share 2,332,928 2,323,651 2,323,645
=================================================================================================
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
CONSOLIDATED
STATEMENTS OF
FINANCIAL CONDITION
<TABLE>
<CAPTION>
December 31,
- ----------------------------------------------------------------------------------
Assets 1995 1994
- ----------------------------------------------------------------------------------
<S> <C> <C>
Assets
Current Assets
Cash and cash equivalents $ 9,507,815 $ 11,668,341
Accounts and notes receivable 77,517,346 90,731,715
Inventories 16,417,820 19,867,066
Costs and estimated profits in excess of billings 38,166,308 30,193,058
Deferred income taxes 4,871,911 5,367,748
Prepaid expenses 913,589 931,974
- ----------------------------------------------------------------------------------
Total current assets 147,394,789 158,759,902
Other Assets 8,079,959 9,458,373
Net Assets of Discontinued Operations 3,916,078 3,557,371
Property, Plant and Equipment
Land 6,783,793 6,959,818
Buildings 31,025,309 30,370,577
Machinery and equipment 62,286,983 59,264,513
- ----------------------------------------------------------------------------------
100,096,085 96,594,908
Allowances for depreciation (58,350,634) (54,169,075)
- ----------------------------------------------------------------------------------
Net property, plant and equipment 41,745,451 42,425,833
- ----------------------------------------------------------------------------------
$201,136,277 $214,201,479
==================================================================================
</TABLE>
<PAGE>
CONSOLIDATED
STATEMENTS OF
FINANCIAL CONDITION
<TABLE>
<CAPTION>
December 31,
- ---------------------------------------------------------------------------------------------------------------------------
Liabilities and Stockholders' Equity 1995 1994
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Current Liabilities
Accounts payable $ 41,610,979 $ 47,328,315
Accrued compensation, related taxes and benefits 11,739,433 10,582,861
Other accrued expenses 2,378,643 3,663,269
Billings in excess of costs and estimated profits 6,435,634 14,309,207
Income taxes 1,344,994 2,118,274
Casualty and liability insurance 8,816,939 8,949,713
- ---------------------------------------------------------------------------------------------------------------------------
Total current liabilities 72,326,622 86,951,639
Revolving Credit Facility 13,000,000 22,000,000
Deferred Income Taxes 5,601,219 5,573,065
Minority Interest 1,266,930 1,127,755
Contingencies and Commitments
Stockholders' Equity
Preferred stock -- par value $.01 per share; authorized 3,000,000 shares; issued -- none
Common stock -- no par value; authorized 15,000,000 shares; issued 2,982,156 shares 33,549,255 33,549,255
Retained earnings 89,677,480 79,201,572
- ---------------------------------------------------------------------------------------------------------------------------
123,226,735 112,750,827
Treasury stock at cost (1995 -- 662,523 shares; 1994 -- 660,253 shares) (14,285,229) (14,201,807)
- ---------------------------------------------------------------------------------------------------------------------------
Total stockholders' equity 108,941,506 98,549,020
- ---------------------------------------------------------------------------------------------------------------------------
$201,136,277 $214,201,479
===========================================================================================================================
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
CONSOLIDATED
STATEMENTS
OF CASH FLOWS
<TABLE>
<CAPTION>
Years ended December 31,
- -------------------------------------------------------------------------------------------------------------------
1995 1994 1993
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash Flows from Operating Activities
Net income $ 13,019,460 $ 12,060,183 $ 1,037,941
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 5,553,960 5,036,755 4,145,385
Discontinued operations (341,873) (1,397,613) 4,617,346
Gain on sale of assets (95,044) (3,576,760) (3,595,414)
Deferred income taxes (credits) 523,991 2,141,057 (979,567)
Minority interest in earnings, net of dividends paid 139,175 219,675 37,150
Other non-cash credits, net 141,077 (301,288) (536,498)
Change in operating assets and liabilities providing (using) cash:
Accounts and notes receivable 14,991,156 (31,132,161) (7,448,578)
Inventories 3,449,246 (3,396,234) (2,821,023)
Prepaid expenses 18,385 663,337 (1,296,847)
Costs, estimated profits and billings, net (15,846,823) 10,937,843 (3,901,538)
Accounts payable (5,717,336) 6,720,222 3,372,152
Accrued liabilities (431,779) (1,727,972) 2,909,863
Income taxes (773,280) 969,217 693,051
- -------------------------------------------------------------------------------------------------------------------
Net cash provided (utilized) by operating activities 14,630,315 (2,783,739) (3,766,577)
- -------------------------------------------------------------------------------------------------------------------
Cash Flows from Investing Activities
Capital expenditures (5,303,654) (7,919,020) (3,941,566)
Proceeds from sale of assets 508,286 3,838,022 4,977,159
Insurance proceeds from flood damage -- -- 10,000,000
Costs incurred related to flood damage -- (3,589,298) (5,727,951)
Acquisitions, net of cash acquired -- (13,499,394) (1,298,174)
Change in investments and other assets (368,499) (340,468) (1,122,699)
- -------------------------------------------------------------------------------------------------------------------
Net cash provided (utilized) by investing activities (5,163,867) (21,510,158) 2,886,769
- -------------------------------------------------------------------------------------------------------------------
Cash Flows from Financing Activities
Proceeds from debt obligations 4,000,000 28,000,000 --
Payments of debt obligations (13,000,000) (6,000,000) (875,000)
Dividends paid (2,321,336) (2,091,114) (2,091,581)
Other (305,638) 107,031 (151,515)
- -------------------------------------------------------------------------------------------------------------------
Net cash provided (utilized) by financing activities (11,626,974) 20,015,917 (3,118,096)
- -------------------------------------------------------------------------------------------------------------------
Decrease in cash and cash equivalents (2,160,526) (4,277,980) (3,997,904)
Cash and cash equivalents at beginning of year 11,668,341 15,946,321 19,944,225
- -------------------------------------------------------------------------------------------------------------------
Cash and Cash Equivalents at End of Year $ 9,507,815 $ 11,668,341 $15,946,321
===================================================================================================================
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
CONSOLIDATED
STATEMENTS OF
STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
Treasury stock
------------------------------------
Common stock Retained earnings Cost Number of shares
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Balance on December 31, 1992 $33,549,255 $70,314,270 $(14,185,450) (660,678)
Net income 1,037,941
Cash dividends ($.90 per share) (2,091,581)
Other (205,190) 53,675 2,500
- -----------------------------------------------------------------------------------------------------
Balance on December 31, 1993 33,549,255 69,055,440 (14,131,775) (658,178)
Net income 12,060,183
Cash dividends ($.90 per share) (2,091,114)
Other 177,063 (70,032) (2,075)
- -----------------------------------------------------------------------------------------------------
Balance on December 31, 1994 33,549,255 79,201,572 (14,201,807) (660,253)
Net income 13,019,460
Cash dividends ($1.00 per share) (2,321,336)
Other (222,216) (83,422) (2,270)
- -----------------------------------------------------------------------------------------------------
Balance on December 31, 1995 $33,549,255 $89,677,480 $(14,285,229) (662,523)
=====================================================================================================
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
NOTES TO
CONSOLIDATED
FINANCIAL STATEMENTS
Significant Accounting Policies
Nature of Business Segments
PDM is a diversified engineering and construction company that is comprised
of three business segments.
The Engineered Construction Division designs, fabricates and constructs
water storage tanks, anaerobic wastewater systems, processing, refining and
storage facilities, and specially engineered products such as low-temperature
and cryogenic systems, high vacuum and thermal test facilities and
supercritical fluid extraction facilities.
Steel Construction is engaged in fabricating and erecting structural steel
for commercial, institutional and public sector buildings, bridge
rehabilitation and fabricating structural steel for new bridges.
Steel Service Centers provide warehousing, first-stage processing and
distribution of carbon steel products including plates, sheets, bars, tubes,
shapes, pipe and other miscellaneous metal products. The culvert facilities
manufacture and market corrugated metal culvert pipe and accessories.
Basis of Presentation
The consolidated financial statements include the accounts of Pitt-Des
Moines, Inc. and its subsidiaries (Company). Inter-company accounts and
transactions have been eliminated in consolidation.
The preparation of the Company's consolidated financial statements in
conformity with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent liabilities at the balance sheet dates
and the reported amounts of revenue and expenses during the reporting periods
for long-term contracts.
The Company has a history of making reasonably dependable estimates of the
extent of progress towards completion, contract revenues, and contract costs on
its long-term contracts. However, due to uncertainties inherent in the
estimation process, actual results could differ materially from those estimates.
Reclassifications
Certain amounts in the 1993 and 1994 consolidated financial statements and
notes to consolidated financial statements have been reclassified to conform
with the 1995 presentation.
Classifications of Current Assets and Liabilities
The Company includes in current assets and current liabilities amounts
realizable and payable under contracts which extend beyond one year. Other
assets and liabilities are classified as current or non-current on the basis of
expected realization or payment within or beyond one year, respectively.
Cash and Cash Equivalents
Cash and cash equivalents are defined as cash and short-term investments
with maturities of three months or less at the time of acquisition.
Inventories
Inventories of raw materials and fabricated parts are principally valued at
the lower of last-in, first-out (LIFO) cost or market except for certain
inventories which are valued at the lower of first-in, first-out (FIFO) cost or
market.
Contract material inventories included in accumulated contract costs are
valued using the specific identification method.
Property, Plant and Equipment
Land, buildings, machinery and equipment are carried at cost. Buildings,
machinery and equipment, including capitalized leases, are depreciated by
accelerated methods.
In 1996, the Company will adopt the Statement of Financial Accounting
Standards No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to be Disposed Of" (SFAS No. 121). The adoption of SFAS No.
121 will not have a material effect on the Company's financial position or
results of operations.
Revenue Recognition
The Company follows the percentage of completion method of reporting income
from contracts. This method takes into account the cost, estimated profit and
earned revenue to date on contracts not yet completed. Revenue recognized is
the portion of the total contract price that the man-hours expended to date
bears to the estimated final total man-hours, based on current estimates of
man-hours to complete. Revenue recognition is not related to progress billings
to customers.
As long-term contracts extend over one or more years, revisions in estimates
of costs and estimated profits during the course of work are reflected in the
accounting period in which the facts which require the revision become known.
At the time a loss on a contract becomes known, the entire amount of the
estimated ultimate loss is recognized in the financial statements. Revenue
<PAGE>
NOTES TO
CONSOLIDATED
FINANCIAL STATEMENTS
from change orders and claims is recognized when the settlement is probable and
the amount can be reasonably estimated. Contract costs include all direct
material, labor, subcontract costs and those indirect costs related to contract
performance. Costs and estimated profits in excess of billings are classified as
a current asset. Amounts billed in excess of costs and estimated profits are
classified as a current liability.
Income Taxes
Deferred tax assets and liabilities are recognized for the expected future
tax consequences of events that have been recognized in the Company's financial
statements or tax returns.
Net Income Per Share of Common Stock
Earnings per share is based on the weighted average number of shares
outstanding during the year and include the dilutive effect of the assumed
exercise of outstanding stock options, as computed under the treasury stock
method.
Acquisition
Phoenix Steel, Inc.
On September 1, 1994, the Company acquired the bridge fabricating assets of
Phoenix Steel, Inc., a steel bridge fabricator. The total cost of this
acquisition was $13.5 million. In addition, $1.1 million will be paid, and
expensed as incurred, in connection with non-compete agreements, expiring in
December 1999, with the former shareholders of Phoenix Steel, Inc.
The acquisition was accounted for as a purchase and, accordingly, the
acquired assets and liabilities were recorded at their estimated fair value at
the date of acquisition. Operating results have been included since the
acquisition date, but pro forma information has not been presented because it
is immaterial.
Accounts and Notes Receivable
On December 31, 1995 and 1994, accounts receivable include approximately
$19.6 million and $17.7 million, respectively, which have been billed under
retainage provisions in contracts and will become due upon completion of the
contracts. Accounts receivable on December 31, 1995 include approximately $1.6
million which is expected to be collected after December 31, 1996. The
allowance for doubtful accounts was approximately $900,000 on December 31, 1995
and 1994, respectively.
The majority of accounts receivable are from customers in various locations
and industries throughout the United States. The Company maintains adequate
reserves for potential credit losses and such losses have been minimal and
within management's estimates.
Inventories
Inventories aggregating approximately $14.9 million and $18.3 million on
December 31, 1995 and 1994, respectively, are valued at the lower of LIFO cost
or market. If these amounts had been valued on the FIFO method, which
approximates replacement cost, these amounts would have been approximately
$15.7 million and $14.7 million higher than reported on December 31, 1995 and
1994, respectively.
Inventories carried on a FIFO basis were $1.5 million and $1.6 million on
December 31, 1995 and 1994, respectively.
Discontinued Operation
On October 31, 1994, the Company sold substantially all of the assets of CVI
Incorporated, a wholly owned subsidiary, to Process Systems International,
Inc., a subsidiary of Chart Industries, Inc., for consideration of $5.7
million, consisting of $650,000 in cash and a promissory note of $5.0 million,
to be paid in installments over four years from the date of sale.
Net assets from discontinued operations in the accompanying consolidated
balance sheet of $3.9 million, includes $2.0 million of net current assets and
$1.9 million of net non-current assets as of December 31, 1995. These amounts
consist primarily of accounts receivable, contract related assets and
liabilities, property, plant and equipment and related liabilities.
Revenues applicable to discontinued operations were $2.3 million, $15.1
million, and $30.6 million in 1995, 1994, and 1993, respectively. Discontinued
operations, net of taxes in the accompanying consolidated statements of income
is composed of the following:
<TABLE>
<CAPTION>
Years ended December 31,
----------------------------
(Dollars in thousands) 1995 1994 1993
- --------------------------------------------------------------
<S> <C> <C> <C>
Income (loss) from operations,
net of income tax expense
(benefit) of $94 in 1995,
$(214) in 1994 and $337 in 1993. $-- $(493) $471
Gain from disposal, net
of income tax expense
of $383 in 1994. -- 573 --
- --------------------------------------------------------------
$-- $ 80 $471
==============================================================
</TABLE>
<PAGE>
NOTES TO
CONSOLIDATED
FINANCIAL STATEMENTS
Costs and Estimated Profits on
Uncompleted Contracts
Costs and estimated profits on uncompleted contracts are summarized as
follows:
<TABLE>
<CAPTION>
December 31,
- ---------------------------------------------------------------
1995 1994
- ---------------------------------------------------------------
<S> <C> <C>
Costs incurred on
uncompleted contracts $ 542,631,132 $ 533,689,497
Estimated profits 69,861,448 54,272,616
- ---------------------------------------------------------------
612,492,580 587,962,113
Billings to date (580,761,906) (572,078,262)
- ---------------------------------------------------------------
$31,730,674 $15,883,851
===============================================================
</TABLE>
Costs, estimated profits and billings on uncompleted contracts are included
in the accompanying Consolidated Statements of Financial Condition under the
following captions:
<TABLE>
<CAPTION>
December 31,
- ---------------------------------------------------------------
1995 1994
- ---------------------------------------------------------------
<S> <C> <C>
Costs and estimated
profits in excess of billings $38,166,308 $30,193,058
Billings in excess of costs
and estimated profits (6,435,634) (14,309,207)
- ---------------------------------------------------------------
$31,730,674 $15,883,851
===============================================================
</TABLE>
Included in costs and estimated profits in excess of billings on uncompleted
contracts at December 31, 1995 was approximately $6.0 million relating to an
unapproved change order arising from a dispute over design and specification
changes on a project currently under construction.
Negotiations to obtain reimbursement for this additional work have
commenced. Management believes that amounts recognized will be realized.
However, this estimate of recovery could change as the negotiations continue.
As additional facts are learned, the Company may revise the estimate of
potential recovery, which could result in a material adjustment to the results
of operations in future periods.
Other Assets
Other assets include prepaid pension costs and notes receivable. During
1994, the Company sold an investment in PDM Saudi Arabia, a joint venture, and
realized a gain of approximately $2.7 million.
Pensions
The Company has a number of noncontributory defined benefit pension plans
covering most employees. Plans covering salaried employees provide monthly
benefits at retirement age based on the participant's monthly salary and years
of employment. Plans covering hourly employees generally provide benefits of
stated amounts for each year of service although certain of such plans provide
benefits based on the participant's hourly wage rate and years of service. The
plans permit the Company, at any time, to amend or terminate the plans subject
to union approval, if applicable.
The Company's policy is to fund the legal minimum required contributions.
Plan assets on December 31, 1995 consisted primarily of listed stocks, bonds,
investments in pooled funds and group annuity contracts of insurance carriers.
The Company also makes contributions to certain multi-employer defined
benefit pension plans primarily for field union employees. These contributions
are determined in accordance with the provisions of negotiated labor contracts
and generally are based on the number of man-hours worked. Company
contributions and cost recognized for these plans were approximately $738,000,
$675,000 and $521,000 for the years ended December 31, 1995, 1994 and 1993,
respectively. The estimated accumulated plan benefits and plan assets for these
plans are not available.
The Company sponsored defined contribution plans which cover nearly all
salaried employees, certain hourly groups in accordance with their union labor
contracts and nearly all non-union field employees. Based upon the plan, the
Company contributions represent either a stated matching percentage of the
participant's basic contribution or a stated rate per hour worked. Company
contributions and cost recognized for these plans were $1.6 million, $1.3
million and $1.2 million for the years ended December 31, 1995, 1994 and 1993,
respectively.
<PAGE>
NOTES TO
CONSOLIDATED
FINANCIAL STATEMENTS
Net periodic pension expense (income) for the Company's continuing
operations defined benefit pension plans included the following components:
<TABLE>
<CAPTION>
Years ended December 31,
- -----------------------------------------------------------------------------------------------
1995 1994 1993
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Service cost-benefits earned during the period $ 1,169,634 $1,287,601 $1,115,407
Interest cost on projected benefit obligation 4,258,907 3,727,962 3,538,634
Actual (return) loss on plan assets (14,100,076) 677,553 (5,581,253)
Net amortization, deferral and other 8,812,612 (6,038,666) 535,543
- -----------------------------------------------------------------------------------------------
Net periodic pension expense (income) $141,077 $ (345,550) $ (391,669)
===============================================================================================
</TABLE>
As a result of restructuring activities, curtailment losses of $218,000 are
reflected in the net amortization and deferral component of net periodic
pension expense for the year ended December 31, 1993. The following assumptions
were used in the determination of net periodic cost:
<TABLE>
<CAPTION>
Years ended December 31,
- --------------------------------------------------------------------
1995 1994 1993
- --------------------------------------------------------------------
<S> <C> <C> <C>
Discount rate 8.5% 7.5% 8.9%
Rates of increase in compensation levels 6.5% 6.0% 6.5%
Expected long-term rates of return on assets 9.0% 9.0% 9.0%
====================================================================
</TABLE>
Interest rates used to discount actuarial liabilities to present value at
December 31, 1995 and 1994 were 7.5 percent and 8.5 percent, respectively.
The following table sets forth the status of the Company's defined benefit
pension plans:
<TABLE>
<CAPTION>
December 31, 1995 December 31, 1994
-------------------------------------- ------------------------------
Plans whose Plans whose Plans whose Plans whose
assets exceed accumulated assets exceed accumulated
accumulated benefits accumulated benefits
benefits exceed assets benefits exceed assets
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Actuarial present value of benefit obligations:
Vested benefit obligation $44,780,865 $5,311,910 $35,236,306 $4,739,165
- ----------------------------------------------------------------------------------------------------------------------------------
Accumulated benefit obligation $45,937,231 $5,595,363 $36,166,544 $5,013,504
- ----------------------------------------------------------------------------------------------------------------------------------
Plan assets at fair value $62,285,463 $3,922,870 $47,878,627 $3,598,344
Projected benefit obligation (53,190,866) (5,595,363) (42,565,855) (5,445,862)
- ----------------------------------------------------------------------------------------------------------------------------------
Plan assets in excess of (less than) projected benefit obligation 9,094,597 (1,672,493) 5,312,772 (1,847,518)
Unrecognized net (gain) loss (1,910,489) 334,527 3,149,077 250,015
Unrecognized net asset (3,489,410) (59,064) (4,194,771) (65,528)
Unrecognized prior service cost 1,578,444 701,390 1,624,892 886,579
Adjustment to recognize minimum liability -- (976,853) -- (711,847)
- ----------------------------------------------------------------------------------------------------------------------------------
Pension asset (liability) recognized in
Consolidated Statements of Financial Condition $5,273,142 $(1,672,493) $5,891,970 $(1,488,299)
===================================================================================================================================
</TABLE>
Amounts shown above for Plans whose accumulated benefits exceed assets at
December 31, 1994 exclude the Projected benefit obligation of $4.2 million, and
associated Plan assets of $3.6 million relating to discontinued operations.
Accrued Liabilities
On November 3, 1993, an accident occurred at the construction site of a new
United States Post Office in Chicago where the Company's Steel Construction
Business segment was in the process of erecting the steel structure of the
building. Two men were killed and five seriously injured when a portion of the
erected steel collapsed. An investigation is being conducted by the Federal
Occupational Safety and Health Administration (OSHA) and the Justice Department
as required by OSHA law. OSHA has cited the Company for safety violations and
has assessed $147,000 in civil penalties. In an order dated April 28, 1995, an
administrative law judge
<PAGE>
NOTES TO
CONSOLIDATED
FINANCIAL STATEMENTS
dismissed OSHA's case assessing civil penalties. OSHA's appeal of this decision
is pending before the Occupational Safety and Health Review Commission. The
Justice Department continues to investigate whether to institute criminal action
against the Company as a result of the accident, and has convened a grand jury
proceeding in the United States District Court for the Northern District of
Illinois. The Company cannot predict whether or not a criminal action will be
instituted. If such action is commenced, and the Company is found in violation
of these laws, management believes that the resulting fines, penalties and costs
of defense, which would be uninsured, would not be material to the Company's
financial condition, although it could be material to the Company's reported
results of operations for the period in which such payments are incurred. The
Company believes that it has significant and meritorious defenses to any such
charges and intends to vigorously defend them. Although the Company has
insurance coverages containing various deductible clauses totalling $1.5
million, the Company and its insurance carriers are assessing the damages and
related policy coverages. A charge of $2.0 million was recorded in the fourth
quarter of 1993 relating to this accident. There may be uninsured costs relating
to this accident for which the Company would be liable.
Employee Stock Ownership Plan
The Company has a noncontributory Employee Stock Ownership Plan (ESOP) which
provides salaried employees, who have at least one year of continuous service,
an opportunity to own Company Common Stock and to accumulate additional
retirement benefits. The Company's contributions, whether in cash or in stock,
are determined annually by the Board of Directors in an amount not to exceed
the maximum allowable as an income tax deduction. Company contributions are 100
percent vested after five years of continuous service. The ESOP contribution is
allocated to the participant's account based upon the actual salary paid to the
participant during that year. The Company's contributions, recorded as
compensation expense, were approximately $639,000, $507,000 and $543,000 for
the years ended December 31, 1995, 1994, and 1993, respectively.
Revolving Credit Facility
The Company has an unsecured revolving credit agreement with several banks
from which it may borrow up to $40 million. This agreement matures on December
31, 1997, at which time all borrowings must be repaid in full. This Agreement
contains an annual option to renew for an additional one-year period, subject
to lender approval. Borrowings under the revolving credit agreement bear
interest at the prime rate or at rates based on the London Interbank Offered
Rate (LIBOR), or other rates which are mutually acceptable to the banks and the
Company. A commitment fee of one-fourth of one percent per annum is charged on
any unused amount of this revolving credit commitment. This agreement contains
restrictive financial covenants that require minimum levels of net worth and
maintenance of specific financial ratios. On December 31, 1995, $13.0 million
of borrowings at 7.1% and $12.5 million of stand-by letters of credit were
outstanding under this agreement.
The Company made cash payments of interest totaling $2.7 million for the
year ended December 31, 1995 and $613,000 and $385,000 for the years ended
December 31, 1994 and 1993, respectively.
Income Taxes
The income tax expense (benefit) included in the Consolidated Statements of
Income is as follows:
<TABLE>
<CAPTION>
Years ended December 31,
--------------------------------------------
1995 1994 1993
- --------------------------------------------------------------------------
<S> <C> <C> <C>
Current:
Federal $5,618,289 $3,415,816 $1,558,663
State 1,300,000 800,000 141,166
Foreign 263,705 408,048 94,837
- --------------------------------------------------------------------------
Total current 7,181,994 4,623,864 1,794,666
Deferred:
Federal 886,742 1,716,378 (736,852)
State 260,805 504,752 (216,693)
- --------------------------------------------------------------------------
Total deferred 1,147,547 2,221,130 (953,545)
- --------------------------------------------------------------------------
Total income tax expense $8,329,541 $6,844,994 $841,121
==========================================================================
</TABLE>
<PAGE>
NOTES TO
CONSOLIDATED
FINANCIAL STATEMENTS
The income tax expense (benefit) applicable to continuing and discontinued
operations is as follows:
<TABLE>
<CAPTION>
Years ended December 31,
- ------------------------------------------------------------------------------------------------
1995 1994 1993
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Provision for continuing operations:
Current $7,712,017 $4,535,213 $1,484,005
Deferred 523,991 2,141,058 (979,567)
- ------------------------------------------------------------------------------------------------
Total provision for continuing operations 8,236,008 6,676,271 504,438
Provisions for discontinued operations:
Current (530,023) 88,651 310,661
Deferred 623,556 80,072 26,022
- ------------------------------------------------------------------------------------------------
Total provisions for discontinued operations 93,533 168,723 336,683
- ------------------------------------------------------------------------------------------------
Total income tax expense $8,329,541 $6,844,994 $ 841,121
================================================================================================
</TABLE>
A reconciliation of statutory federal income tax to the income tax expense
on the income from continuing operations is as follows:
<TABLE>
<CAPTION>
Years ended December 31,
- ------------------------------------------------------------------------------------------------
1995 1994 1993
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Statutory federal income tax expense $7,226,859 $6,343,072 $364,282
Increase (decrease) in taxes resulting from:
Tax benefit from sale of a foreign investment -- (525,936) --
State taxes less federal benefit 858,000 521,482 68,090
Other, net 151,149 337,653 72,066
- ------------------------------------------------------------------------------------------------
Income tax expense -- continuing operations $8,236,008 $6,676,271 $504,438
================================================================================================
</TABLE>
Deferred taxes reflected the tax effects of differences between the amounts
recorded as assets and liabilities for financial reporting purposes and the
amounts recorded for income tax purposes. The tax effects of significant
temporary differences giving rise to deferred tax assets and liabilities are as
follows:
<TABLE>
<CAPTION>
December 31,
- ------------------------------------------------------------------
1995 1994
- ------------------------------------------------------------------
<S> <C> <C>
Deferred tax assets:
Casualty and liability insurance $2,595,613 $2,851,135
Contract related amounts 131,980 156,233
Inventory 102,931 369,115
Employee benefits 1,694,187 1,644,065
Accounts receivable allowance 347,200 347,200
- ------------------------------------------------------------------
Total deferred tax assets $4,871,911 $5,367,748
==================================================================
Deferred tax liabilities:
Accelerated depreciation $3,263,232 $3,016,078
Pension 2,333,870 2,210,302
Other 4,117 346,685
- ------------------------------------------------------------------
Total deferred tax liabilities $5,601,219 $5,573,065
==================================================================
</TABLE>
Income taxes paid for the years ended December 31, 1995, 1994 and 1993 were
approximately $7.1 million, $3.7 million and $1.1 million, respectively.
<PAGE>
NOTES TO
CONSOLIDATED
FINANCIAL STATEMENTS
Stock Plan
The Stock Option Plan of 1990 (Plan) provides for grants of incentive stock
options to officers and key employees. The Plan is administered by a committee
consisting of at least three directors of the Company, none of whom are
eligible to participate in the Plan. A total of 200,000 shares of the Company's
Common Stock may be issued pursuant to the Plan. Grant prices are determined by
the committee and are established at the fair market value of the Company's
Common Stock at the date of grant. Options vest over a four-year period in
equal annual amounts, or over such other period as the committee shall
determine, and may be accelerated in the event of certain other circumstances
such as death or disability of the optionee. These options generally expire
within ten years after the date of grant. The following table summarizes option
activity for the two years ended December 31, 1995:
<TABLE>
<CAPTION>
Option price range
Shares per share
- ------------------------------------------------------------------
<S> <C> <C>
Outstanding on December 31, 1993 65,500 $30.75 - $37.25
==================================================================
Outstanding on December 31, 1994 65,500 $30.75 - $37.25
- ------------------------------------------------------------------
Granted 72,500 $34.75
Surrendered (7,000) $37.00 - $37.25
- ------------------------------------------------------------------
Outstanding on December 31, 1995 131,000 $30.75 - $37.25
==================================================================
Exercisable:
December 31, 1994 61,500 $30.75 - $37.25
December 31, 1995 75,625 $30.75 - $37.25
==================================================================
Available for future grant:
December 31, 1994 130,000
December 31, 1995 64,500
==================================================================
</TABLE>
In October 1995, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation" (SFAS No. 123). SFAS No. 123 establishes financial accounting and
reporting standards for stock-based compensation plans and to transactions in
which an entity issues its equity instruments to acquire goods and services
from non-employees. The new accounting standards prescribed by SFAS No. 123 are
optional, and the Company may continue to account for its plans under previous
accounting standards. The Company does not expect to adopt the new accounting
standard, and consequently, SFAS No. 123 will not have an impact on the
Company's consolidated results of operations.
Contingencies
There are various claims and legal proceedings against the Company arising
from the normal course of business. Although counsel is unable to predict with
certainty the ultimate outcome, management and counsel believe the Company has
significant and meritorious defenses to any claims, and intend to pursue them
vigorously.
As previously reported, in May 1984, Washington Public Power Supply System
(WPPSS) filed a complaint against the Company and its surety in the United
States District Court for the Eastern District of Washington. All of WPPSS'
claims against the Company and its surety have been dismissed.
The Company's operations, including idle facilities and other property, are
subject to and affected by federal, state and local laws and regulations
regarding the protection of the environment. The Company accrues for
environmental costs where such obligations are either known or considered
probable and can be reasonably estimated.
The Company is participating as a potentially responsible party (PRP) at
three different sites pursuant to proceedings under the Comprehensive
Environmental Response, Compensation and Liability Act (CERCLA). Other parties
have also been identified as PRP's at the sites. Investigative and/or remedial
activities are ongoing. The Company believes, based upon information presently
available to it, that such future costs will not have a material effect on the
Company's financial position, results of operations or liquidity. However, the
imposition of more stringent requirements under environmental laws or
regulations, new developments or changes regarding site cleanup costs or the
allocation of such costs amount PRP's or a determination that the Company is
potentially responsible for the release of hazardous substances at sites other
than those currently identified, could result in additional costs.
Management believes it is improbable that the ultimate outcome of any matter
currently pending against the Company will materially affect the financial
position of the Company.
Business Segment Information
For business segment information for years ended December 31, 1995, 1994 and
1993, see Business Segment Information in Consolidated Financial Statements
section in the 1995 Annual Report to Stockholders.
<PAGE>
REPORTS OF
INDEPENDENT AUDITORS
AND MANAGEMENT
Report of Independent Auditors
Stockholders and Board of Directors
Pitt-Des Moines, Inc.
We have audited the accompanying consolidated statements of financial
condition of Pitt-Des Moines, Inc. and subsidiaries as of December 31, 1995 and
1994, and the related consolidated statements of income, stockholders' equity,
and cash flows for each of the three years in the period ended December 31,
1995. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position
of Pitt-Des Moines, Inc. and subsidiaries as of December 31, 1995 and 1994, and
the consolidated results of their operations and their cash flows for each of
the three years in the period ended December 31, 1995, in conformity with
generally accepted accounting principles.
/s/ Ernst & Young LLP
Ernst & Young LLP
Pittsburgh, Pennsylvania
March 1, 1996
Report of Management
The management of Pitt-Des Moines, Inc. and its subsidiaries is responsible
for preparing the financial statements and for ensuring that other information
included in this annual report is consistent therewith. Estimates and judgments
are necessary ingredients in the preparation of the financial statements.
Management is considerate of these estimates and judgments and believes that
the financial statements and other financial information included herein have
been prepared, in all material respects, in conformity with accounting
principles that are generally accepted, appropriate in the circumstances and
consistently applied. The financial statements have been audited by Ernst &
Young LLP, independent auditors.
In order to prepare the financial statements, Pitt-Des Moines, Inc.
maintains and relies upon a system of internal accounting control. This system
is designed to provide reasonable assurance that assets are safeguarded,
transactions are executed in accordance with management's authorization and
transactions are recorded properly. This system is tested and evaluated by
Pitt-Des Moines, Inc.'s internal auditors. Ernst & Young LLP evaluates the
system of internal accounting control to determine the extent and timing of the
procedures they deem necessary to express an opinion on the financial
statements, taken as a whole.
Oversight of the audit process is provided by the Audit Committee of the
Board of Directors. The Audit Committee meets with the internal auditors and
the independent auditors to discuss and review audit scope and audit findings.
The internal and independent auditors have free access to the Audit Committee;
management is not present during these discussions unless requested by the
Audit Committee. The Audit Committee also recommends to the Board of Directors
the appointment of the independent auditors.
Management recognizes its responsibility for fostering a strong ethical
climate so that the business of Pitt-Des Moines, Inc. is conducted according to
the highest standard of corporate conduct.
/s/ Wm. W. McKee
Wm. W. McKee
President and Chief Executive Officer
/s/ R. A. Byers
R. A. Byers
Vice President Finance and Treasurer
<PAGE>
TWO YEAR
QUARTERLY RESULTS
OF OPERATIONS
(UNAUDITED)
The following is a summary of the quarterly results of operations:
<TABLE>
<CAPTION>
Quarters ended
----------------------------------------------------------
(Dollars in thousands, except per share amounts) March 31, June 30, September 30, December 31,
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1995
Earned revenue $119,242 $113,468 $123,186 $105,378
Gross profit from operations 13,295 14,798 17,151 17,298
Income before income taxes 3,699 4,330 6,857 6,369
Income from continuing operations 2,279 2,627 4,158 3,955
Income (loss) from discontinued operations -- -- -- --
- --------------------------------------------------------------------------------------------------------------
Net income $ 2,279 $ 2,627 $ 4,158 $ 3,955
==============================================================================================================
Net income (loss) per share:
Continuing operations $ 0.98 $ 1.13 $ 1.78 $ 1.69
Discontinued operations -- -- -- --
- --------------------------------------------------------------------------------------------------------------
Net income per share $ 0.98 $ 1.13 $ 1.78 $ 1.69
==============================================================================================================
1994
Earned revenue $ 95,222 $100,658 $107,504 $104,676
Gross profit from operations 9,240 11,179 12,795 17,207
Income before income taxes 1,232 3,808 6,884 6,732
Income from continuing operations 758 2,300 4,805 4,117
Income (loss) from discontinued operations (388) (70) (51) 589
- --------------------------------------------------------------------------------------------------------------
Net income $ 370 $ 2,230 $ 4,754 $ 4,706
==============================================================================================================
Net income (loss) per share:
Continuing operations $ 0.33 $ 0.99 $ 2.06 $ 1.77
Discontinued operations (0.17) (0.03) (0.02) 0.25
- --------------------------------------------------------------------------------------------------------------
Net income per share $ 0.16 $ 0.96 $ 2.04 $ 2.02
==============================================================================================================
</TABLE>
A separate computation of earnings per share is made for each quarter
presented. The dilutive effect on earnings per share resulting from the assumed
exercise of stock options is included in each quarter in which dilution occurs.
The earnings per share computation for the year is a separate annual
calculation. Accordingly, the sum of the quarterly earnings per share amounts
will not necessarily equal the earnings per share for the year.
<PAGE>
STOCKHOLDERS'
REFERENCE
Common Stock Information
The following table sets forth, for the periods indicated, the high and low
stock prices of the Common Stock and the dividends paid per share of Common
Stock.
<TABLE>
<CAPTION>
Price range Quarterly
----------- dividends
High Low per share
<S> <C> <C> <C>
- ---------------------------------------------------
1995
First Quarter $ 37 $31-1/2 $ .25
Second Quarter 36-3/8 32-1/2 .25
Third Quarter 37-3/4 32-1/4 .25
Fourth Quarter 39-1/4 36 .25
- ---------------------------------------------------
$ 1.00
===================================================
1994
First Quarter $ 36 $ 27 $.22-1/2
Second Quarter 32-1/2 27 .22-1/2
Third Quarter 33 26 .22-1/2
Fourth Quarter 35-3/4 28-1/2 .22-1/2
- ---------------------------------------------------
$ .90
===================================================
</TABLE>
On February 29, 1996, there were 2,323,633 shares outstanding and approximately
446 stockholders of record of the Company's Common Stock.
Stock Trading
The Company's Common Stock is traded on the American Stock Exchange (symbol
PDM).
<PAGE>
Exhibit 21
SUBSIDIARIES OF THE COMPANY
Pitt-Des Moines, Inc.
December 31, 1995
<TABLE>
<CAPTION>
Percentage of Jurisdiction of
Name of Subsidiary Ownership Incorporation
<S> <C> <C>
Canadian Des Moines Industries Ltd. 100 Canada
Construcciones Pitt-Des Moines Venezuela,
C.A. 100 Venezuela
Hammond Latino Americana, S.A. 100 Panama
HyCon, Inc. 81 Alabama
Hydrostorage, Inc. 100 Tennessee
Oregon Culvert Co., Inc. 81 Oregon
d/b/a Washington Culvert Co.
PDM Argentina, SA 100 Argentina
PDM Australia Pty. Ltd. 100 Australia
PDM Bonaire, N.V. 100 Bonaire
PDM Bridge Corporation 100 Delaware
PDM Chile Limitada 100 Chile
PDM El Salvador, S.A. de C.V. 100 El Salvador
PDM International Ltd. 100 Delaware
PDM Latin America Ltd. 100 Georgia
PDM Ohio, Inc. 100 Ohio
PDM Services A.G. 100 Liechtenstein
PDM Strocal, Inc. 100 Pennsylvania
PDM Virgin Islands, Ltd. 100 Virgin Islands
Pittsburgh-Des Moines Sdn. Bhd.
(PDM Malaysia) 100 Malaysia
P.T. Perkasa Daya Megah
(PDM Indonesia) (1) 100 Indonesia
</TABLE>
NOTES OF EXPLANATION
(1) Managed by PDM Services A.G.
<PAGE>
Exhibit 23
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Annual Report (Form 10-K)
of Pitt-Des Moines, Inc. of our report dated March 1, 1996, included in the
Pitt-Des Moines, Inc. 1995 Annual Report.
Our audit also included the financial statement schedule of Pitt-Des Moines,
Inc. listed in Item 14(a). This schedule is the responsibility of the Company's
management. Our responsibility is to express an opinion based on our audits. In
our opinion, the financial statement schedule referred to above, when considered
in relation to the basic financial statements taken as a whole, present fairly
in all material respects the information set forth therein.
We also consent to the incorporation by reference in the Registration Statement
(Form S-8 No. 33-34787) pertaining to the Stock Option Plan of 1990 of Pitt-Des
Moines, Inc. of our report dated March 1, 1996, with respect to the consolidated
financial statements incorporated herein by reference, and our report included
in the preceding paragraph with respect to the financial statement schedule
included in this Annual Report (Form 10-K) of Pitt-Des Moines, Inc.
ERNST & YOUNG LLP
Pittsburgh, Pennsylvania
March 22, 1996
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<CASH> 9,507
<SECURITIES> 0
<RECEIVABLES> 78,385
<ALLOWANCES> 868
<INVENTORY> 16,418
<CURRENT-ASSETS> 147,395
<PP&E> 100,096
<DEPRECIATION> 58,351
<TOTAL-ASSETS> 201,136
<CURRENT-LIABILITIES> 72,327
<BONDS> 13,000
0
0
<COMMON> 33,549
<OTHER-SE> 75,393
<TOTAL-LIABILITY-AND-EQUITY> 201,136
<SALES> 461,274
<TOTAL-REVENUES> 461,274
<CGS> 398,732
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,927
<INCOME-PRETAX> 21,255
<INCOME-TAX> 8,236
<INCOME-CONTINUING> 13,019
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 13,019
<EPS-PRIMARY> 5.58
<EPS-DILUTED> 5.58
</TABLE>
