<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE PERIOD ENDED NOVEMBER 30, 1995
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE
NO. 1-9944
CHAPARRAL STEEL COMPANY
Incorporated in
STATE OF DELAWARE
IRS Employer Identification
NO. 75-1424624
300 WARD ROAD
MIDLOTHIAN, TEXAS 76065
Telephone: (214) 775-8241
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter periods that the
Registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. Yes X No .
----- -----
29,092,100 Shares of Common Stock, Par Value $.10 Outstanding at January 8,
1996.
1 of 13
<PAGE> 2
INDEX
CHAPARRAL STEEL COMPANY
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION Page
- ----------------------------- ----
<S> <C>
Item 1. Financial Statements (Unaudited)
Condensed consolidated balance sheets--November 30,
1995 and May 31, 1995 3
Condensed consolidated statements of income--three and six
months ended November 30, 1995 and 1994 4
Condensed consolidated statements of cash flows
--six months ended November 30, 1995 and 1994 5
Notes to condensed consolidated financial statements
--November 30, 1995 6
Independent accountants' review report 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
PART II. OTHER INFORMATION
- ---------------------------
Item 4. Submission of Matters to a Vote of Security Holders 11
Item 6. Exhibits and Reports on Form 8-K 11
SIGNATURES 11
- ----------
</TABLE>
2
<PAGE> 3
CONDENSED CONSOLIDATED BALANCE SHEETS
CHAPARRAL STEEL COMPANY AND SUBSIDIARIES
<TABLE>
<CAPTION>
(Unaudited)
November 30, May 31,
1995 1995
----------- ----------
(In thousands)
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 21,863 $ 19,140
Trade accounts receivable, net of allowance
of $2.7 million and $2.5 million, respectively 51,142 51,679
Inventories 106,865 101,377
Prepaid expenses 12,779 8,110
---------- ----------
TOTAL CURRENT ASSETS 192,649 180,306
PROPERTY, PLANT AND EQUIPMENT
Buildings and improvements 49,274 48,689
Machinery and equipment 457,116 447,982
Land 1,288 1,288
---------- ----------
507,678 497,959
Less allowance for depreciation (289,143) (275,476)
---------- ----------
218,535 222,483
OTHER ASSETS
Goodwill, commissioning costs and other assets,
net of accumulated amortization of $24.8 million
and $22.3 million, respectively 64,697 67,038
---------- ----------
$ 475,881 $ 469,827
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Trade accounts payable $ 30,396 $ 37,818
Accrued interest payable 1,823 1,862
Other accrued expenses 20,758 13,236
Current portion of long-term debt 12,396 13,645
---------- ----------
TOTAL CURRENT LIABILITIES 65,373 66,561
LONG-TERM DEBT 80,963 81,065
DEFERRED INCOME TAXES
AND OTHER CREDITS 52,090 52,333
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value, 500,000
authorized, none outstanding - -
Common stock, $.10 par value, 29,033,100 and
29,679,900 shares outstanding, respectively 2,994 2,994
Paid-in capital 178,595 178,611
Retained earnings 104,712 90,767
Cost of common stock in treasury (8,846) (2,504)
---------- ----------
277,455 269,868
---------- ----------
$ 475,881 $ 469,827
========== ==========
</TABLE>
See notes to condensed consolidated financial statements.
3
<PAGE> 4
(Unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
CHAPARRAL STEEL COMPANY AND SUBSIDIARIES
<TABLE>
<CAPTION>
Three months ended Six months ended
November 30, November 30,
1995 1994 1995 1994
---- ---- ---- ----
(In thousands except per share)
<S> <C> <C> <C> <C>
Net sales $ 154,990 $ 126,273 $ 293,131 $ 250,655
Costs and expenses:
Cost of sales (exclusive of items stated
separately below) 121,367 103,073 233,448 208,992
Depreciation and amortization 8,090 8,410 16,178 16,818
Selling, general and administrative 6,778 4,673 12,510 8,608
Interest 2,618 3,134 5,238 6,414
Other income (1,137) (888) (2,243) (1,017)
---------- --------- --------- ---------
INCOME BEFORE INCOME TAXES 17,274 7,871 28,000 10,840
Provision for income taxes 6,789 2,902 11,087 4,118
---------- --------- --------- ---------
NET INCOME $ 10,485 $ 4,969 $ 16,913 $ 6,722
========== ========= ========= =========
Per common share:
NET INCOME $ .35 $ .17 $ .57 $ .23
========== ========= ========= =========
CASH DIVIDENDS $ .05 $ .05 $ .10 $ .10
========== ========= ========= =========
Average shares outstanding - Note B 29,749 29,711 29,777 29,712
========== ========= ========= =========
</TABLE>
See notes to condensed consolidated financial statements.
4
<PAGE> 5
(Unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
CHAPARRAL STEEL COMPANY AND SUBSIDIARIES
<TABLE>
<CAPTION>
Six months ended
November 30,
1995 1994
---- ----
(In thousands)
<S> <C> <C>
OPERATING ACTIVITIES
Net income $ 16,913 $ 6,722
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 16,178 16,818
Deferred income taxes (905) 937
Other deferred credits 662 (153)
Changes in operating assets and liabilities:
Trade accounts receivable, net 537 (1,458)
Inventories (5,488) 14,952
Prepaid expenses (4,669) (2,623)
Trade accounts payable (7,422) 353
Accrued interest payable (39) (41)
Other accrued expenses 7,522 318
--------- ---------
Net cash provided by operating activities 23,289 35,825
INVESTING ACTIVITIES
Capital expenditures (10,262) (6,327)
Other 417 12
--------- ---------
Net cash used in investing activities (9,845) (6,315)
FINANCING ACTIVITIES
Repayments on short-term debt - (15,000)
Long-term borrowings 52 63
Repayments on long-term debt (1,403) (2,915)
Purchase of treasury stock (6,402) -
Dividends paid (2,968) (2,968)
--------- ---------
Net cash used in financing activities (10,721) (20,820)
--------- ---------
Increase in cash and cash equivalents 2,723 8,690
Cash and cash equivalents at beginning of period 19,140 3,203
--------- ---------
Cash and cash equivalents at end of period $ 21,863 $ 11,893
========= =========
</TABLE>
See notes to condensed consolidated financial statements.
5
<PAGE> 6
(Unaudited)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
CHAPARRAL STEEL COMPANY AND SUBSIDIARIES
November 30, 1995
NOTE A - Basis of Presentation
The accompanying unaudited condensed consolidated financial statements of
Chaparral Steel Company and Subsidiaries (the "Company") have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q. Accordingly, they do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the six month period ended November 30, 1995 are not necessarily
indicative of the results that may be expected for the year ending May 31,
1996. For further information, refer to the consolidated financial statements
and footnotes thereto included in the Company's annual report on Form 10-K for
the year ended May 31, 1995.
NOTE B - Earnings Per Share
Texas Industries, Inc. ("TXI") owned 100% of the Company from November 1985,
when it acquired the remaining 50% of the outstanding securities of the Company
from Co-Steel Inc. ("Co-Steel"), until July 1988, when approximately 19.8% of
the outstanding securities were sold in an initial public offering of common
stock by the Company. Under terms of the purchase agreement between TXI and
Co-Steel, TXI made a $42 million initial cash payment and a $73 million final
payment in August 1990.
The acquisition by TXI has been accounted for using the purchase method of
accounting. The $115 million total purchase price exceeded the value of
acquired assets by $83 million and the excess has been recorded as goodwill and
additional paid-in-capital. During May 1995, the Company recorded a $9.4
million adjustment to the original amount of goodwill. The amount of goodwill,
net of accumulated amortization, included in other assets was $60.2 million,
$61.2 million and $73 million at November 30, 1995, May 31, 1995 and May 31,
1994, respectively. This goodwill is being amortized over 40 years using the
straight-line method and reduced earnings by $1 million and $1.2 million in the
six months ended November 30, 1995 and 1994, respectively. Management reviews
the remaining goodwill with consideration toward recovery through future
operating results (undiscounted) at the current rate of amortization.
Net income per common share is calculated based upon a weighted average of
shares outstanding.
NOTE C - Income Tax Provision
The provision for income taxes has been included in the accompanying financial
statements on the basis of an estimated annual rate. Goodwill amortization
also contributed to the difference between provision amounts and amounts
computed by applying the statutory income tax rates.
6
<PAGE> 7
NOTE D - Inventories
Inventories consist of the following:
<TABLE>
<CAPTION>
November 30, May 31,
1995 1995
---- ----
(In thousands)
<S> <C> <C>
Finished goods $ 52,409 $ 54,323
Work in process 13,352 9,856
Raw materials 18,798 14,052
Rolls 18,356 18,148
Supplies 15,170 15,487
LIFO adjustment (11,220) (10,489)
-------- --------
$106,865 $101,377
======== ========
</TABLE>
Inventories are stated at the lower of cost (last-in, first-out) or market,
except rolls which are stated at cost (specific identification) and supplies
which are stated at average cost.
NOTE E - Commissioning Costs
The Company's policy for new facilities is to capitalize certain costs until
the facility is substantially complete and ready for its intended use. The
large beam mill was substantially complete and ready for its intended use in
the third quarter of fiscal 1992 with a total of $15.1 million of costs
deferred, including $4.4 million of interest and $3.4 million of depreciation.
The amounts of commissioning costs (net of amortization) were $3.5 million and
$5 million at November 30, 1995 and May 31, 1995, respectively. Amortization
of $1.5 million was recorded in the first six months of fiscal 1996 and 1995,
respectively, based on a five year period.
NOTE F - Contingencies
The Company and subsidiaries are defendants in lawsuits which arose in the
normal course of business. In management's judgment (based on the opinion of
counsel) the ultimate liability, if any, from such legal proceedings will not
have a material effect on the Company's financial position.
The Company is subject to federal, state and local environmental laws and
regulations concerning, among other matters, air emission, furnace dust
disposal and wastewater discharge. The Company believes it is in substantial
compliance with applicable environmental laws and regulations. Notwithstanding
such compliance, if damage to persons or property or contamination of the
environment has been or is caused by the conduct of the Company's business or
by hazardous substances or wastes used in, generated or disposed of by the
Company, the Company could be held liable for such damages and be required to
pay the cost of investigation and remediation of such contamination. The
amount of such liability could be material. Changes in federal or state laws,
regulations or requirements or discovery of unknown conditions could require
additional expenditures by the Company.
7
<PAGE> 8
[ERNST & YOUNG LLP LETTERHEAD]
EXHIBIT A
Independent Accountants' Review Report
Board of Directors
Chaparral Steel Company
We have reviewed the accompanying condensed consolidated balance sheet of
Chaparral Steel Company and subsidiaries as of November 30, 1995, and the
related condensed consolidated statements of income for the three month and six
month periods ended November 30, 1995 and 1994, and the condensed consolidated
statements of cash flows for the six month periods ended November 30, 1995 and
1994. These financial statements are the responsibility of the Company's
management.
We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards, which will be
performed for the full year with the objective of expressing an opinion
regarding the financial statements taken as a whole. Accordingly, we do not
express such an opinion.
Based on our reviews, we are not aware of any material modifications that
should be made to the accompanying condensed consolidated financial statements
referred to above for them to be in conformity with generally accepted
accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of Chaparral Steel Company and
subsidiaries as of May 31, 1995, and the related consolidated statements of
income, stockholders' equity and cash flows for the year then ended (not
presented herein), and in our report dated July 14, 1995, we expressed an
unqualified opinion on those consolidated financial statements. In our
opinion, the information set forth in the accompanying condensed consolidated
balance sheet as of May 31, 1995, is fairly stated, in all material respects,
in relation to the consolidated balance sheet from which it has been derived.
/s/ ERNST AND YOUNG LLP
Ernst and Young LLP
Dallas, Texas
December 15, 1995
8
<PAGE> 9
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
(Unaudited)
Comparison of operations and financial condition for the quarter and six
months ended November 30, 1995 to the quarter and six months ended November 30,
1994.
RESULTS OF OPERATIONS
An increase in average selling price and shipments of approximately 10%
resulted in a $28.7 million increase in net sales in the three month period
ended November 30, 1995 compared to the same quarter in the prior year. Net
sales increased $42.5 million in the six month period ended November 30, 1995
due to a 17% increase in average selling price and an increase in shipments of
36,000 tons. The improved demand exhibited in the August 1995 quarter
continued in the current quarter as the Company announced price increases in
December on most structural products effective in the third quarter of fiscal
1996. Demand from service centers, fabricators and the mobile home industry
for structural mill products has increased substantially from the prior year.
However, continued growth in construction volume is generally dependent on the
health of the economy and changes in interest rates. Demand for bar products
continued to decrease in the November 1995 quarter as U.S. manufacturing
weakened. The Company continues to monitor and change its product mix in order
to maximize profit margins.
Cost of sales (exclusive of depreciation and amortization) increased $18.3
million to $121.4 million for the three month period ended November 30, 1995
compared to the same period in the prior year. The increase was predominately
caused by an increase in shipments of 38,000 tons and higher melt shop
conversion costs. Cost of sales increased $24.5 million to $233.4 million for
the six month period ended November 30, 1995 compared to the same period in the
prior year due primarily to the increase in shipments. Scrap prices are
expected to follow their seasonal pattern of moving slightly upward this winter
before moderating in the spring. Combined rolling conversion costs increased
slightly from the prior year periods.
Selling, general and administrative expense increased $2.1 million and $3.9
million in the three and six month periods ended November 30, 1995 compared to
the prior year periods primarily due to increases in employee incentive
programs which are based on profitability.
Interest expense decreased $.5 million and $1.2 million in the three and six
month periods ended November 30, 1995 compared to the same periods in the prior
year. Interest expense in the current periods was reduced by repayments of
long-term debt which is principally at fixed rates.
The provision for income taxes has been calculated on the basis of an estimated
annual rate. Goodwill amortization also contributed to the difference between
provision amounts and income tax amounts computed by applying the statutory
federal income tax rates.
The increase in net income in the current periods was due to higher average
selling prices and increased shipments. Over the near term, shipment levels
are expected to continue to exceed those of last year at prices that continue
to move upward. Slightly higher scrap prices will somewhat offset increasing
selling prices, but positive earnings comparisons to the prior year should
occur in upcoming quarters.
9
<PAGE> 10
CAPITAL RESOURCES AND LIQUIDITY
Working capital increased $13.5 million to an all-time high of $127.3 million
at November 30, 1995. The increase in net income of $10.2 million provided
additional working capital in the first six months of fiscal 1996. Inventories
increased $5.5 million as the Company increased its raw material inventories in
anticipation of increased prices during the winter quarter. Prepaid expenses
increased $4.7 million from May 31, 1995 as a result of summer shutdown
spending that will be amortized over the remainder of the fiscal year.
Accounts payable decreased $7.4 million to a more normal level of $30.4 million
at November 30, 1995. Other accrued expenses increased $7.5 million to $20.8
million due to increases in accruals for income taxes, property taxes and
employee incentives. The other components of working capital were virtually
unchanged from the previous fiscal year-end. Net cash provided by operations
in the six months ended November 1995 decreased by $12.5 million due primarily
to the change in net cash provided by inventory. At May 31, 1994, inventory had
increased as management anticipated higher demand in the summer of 1994. As
that higher demand materialized, the amount of inventory returned to a more
normal historical level at November 30, 1994. As filed on Form 8-K, during
October 1995, the Board of Directors approved the repurchase of shares of the
Company's stock from time to time to satisfy obligations under its stock option
program and for other corporate purposes. As a result, cash and cash
equivalents increased $2.7 million after the Company bought $10.3 million of
capital additions, repaid $1.4 million of long-term debt, purchased $6.4
million of treasury stock and paid cash dividends of $3 million.
Capital expenditures for the six months ended November 30, 1995 totaled $10.3
million and are estimated to be approximately $25-$30 million in fiscal 1996;
which represents normal replacement and upgrades of existing equipment. The
Company currently does not plan any major capital expenditures requiring
significant capital resources within the next two years.
The Company's capitalization of $370.8 million at November 30, 1995, consisted
of $93.3 million of long-term debt and $277.5 million of stockholders' equity.
The current portion of long-term debt totaled $12.4 million at November 30,
1995. The Company's average interest rate on long-term debt is 11%. The
Company's payments of principal and interest are expected to be approximately
$22 million during the next twelve months.
The Company is subject to federal, state and local environmental laws and
regulations concerning, among other matters, waste water effluent, air
emissions and electric arc furnace ("EAF") dust disposal. From time to time,
the Company is involved in litigation relating to claims arising in the
ordinary course of business operations. No litigation (based on the opinion of
counsel) is pending against or currently affects the Company, the ultimate
liability of which, if any, would have a material effect on the Company's
financial position or results of operations. The Company maintains a hazardous
waste liability policy against certain third party claims, which insurance the
Company believes to be adequate in relation to the Company's business.
The Company has short-term credit facilities with two banks totaling $20
million which will expire January 31, 1996 if not renewed by the banks or the
Company. No borrowings existed under these arrangements during the six months
ended November 30, 1995. The Company believes that it will be able to renew
these credit facilities or negotiate similar arrangements with other financial
institutions if they are deemed necessary. The Company expects that current
financial resources and anticipated cash provided from operations in fiscal
1996 will be sufficient to provide funds for capital expenditures, meet
scheduled debt payments and satisfy other known working capital needs for
fiscal 1996. If additional funds are required to accomplish long-term
expansion of its productive capabilities, the Company believes that funding can
be obtained to meet such requirements.
10
<PAGE> 11
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
At the Annual Meeting of the Stockholders held October 18, 1995,
stockholders elected as Directors of the Company, Robert Alpert, John M. Belk,
Gordon E. Forward, Gerald R. Heffernan, Gerhard Liener, Eugenio Clariond Reyes
and Robert D. Rogers, to terms expiring in 1996. Votes cast to elect the
Directors were as follows:
<TABLE>
<CAPTION>
Shares withheld
Shares for and against
---------- -----------
<S> <C> <C>
Robert Alpert 29,282,836 10,778
John M. Belk 29,241,536 52,078
Gordon E. Forward 29,272,036 21,578
Gerald R. Heffernan 29,238,536 55,078
Gerhard Liener 29,049,532 244,082
Eugenio Clariond Reyes 29,280,296 13,318
Robert D. Rogers 29,272,336 21,278
</TABLE>
Item 6. Exhibits and Reports on Form 8-K.
The following exhibits are included herein:
(11) Statement re: Computation of earnings per share
(15) Letter re: Unaudited interim financial information
(27) Financial Data Schedule
The Company filed the following reports on Form 8-K during the three
months ended November 30, 1995.
On October 24, 1995, Chaparral Steel Company filed a report on Form 8-K
relative to the status of the repurchase of stock for the Company's stock
option program and other corporate purposes.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
CHAPARRAL STEEL COMPANY
January 9, 1996 /s/ RICHARD M. FOWLER
- --------------- -----------------------------------
Richard M. Fowler
Senior Vice-President & Treasurer,
Chief Financial Officer
January 9, 1996 /s/ LARRY L. CLARK
- --------------- -----------------------------------
Larry L. Clark
Vice President - Controller and
Assistant Treasurer
11
<PAGE> 1
EXHIBIT 11
COMPUTATION OF EARNINGS PER SHARE
CHAPARRAL STEEL COMPANY AND SUBSIDIARIES
<TABLE>
<CAPTION>
Three months ended Six months ended
November 30, November 30,
1995 1994 1995 1994
---- ---- ---- ----
(In thousands except per share)
<S> <C> <C> <C> <C>
AVERAGE SHARES OUTSTANDING
Primary:
Average shares outstanding 29,587 29,680 29,634 29,680
Stock options - treasury stock method
using average market prices 162 31 143 32
-------- --------- -------- ---------
TOTALS 29,749 29,711 29,777 29,712
======== ========= ======== =========
Fully diluted:
Average shares outstanding 29,587 29,680 29,634 29,680
Stock options - treasury stock method
using end of quarter market
price if higher than average 214 32 188 32
-------- --------- -------- ---------
TOTALS 29,801 29,712 29,822 29,712
======== ========= ======== =========
INCOME APPLICABLE
TO COMMON STOCK
Primary and fully diluted:
Net income $ 10,486 $ 4,969 $ 16,913 $ 6,722
Add:
Pre-September 1990 contingent
price amortization 58 58 116 116
-------- --------- -------- ---------
$ 10,544 $ 5,027 $ 17,029 $ 6,838
======== ========= ======== =========
PER SHARE
Net income per common share:
Primary $ .35 $ .17 $ .57 $ .23
======== ======== ======== =========
Fully diluted $ .35 $ .17 $ .57 $ .23
======== ======== ======== =========
</TABLE>
12
<PAGE> 1
EXHIBIT 15
Board of Directors
Chaparral Steel Company
We are aware of the incorporation by reference in the Registration Statement
(Form S-8 No. 33-39626) pertaining to the Chaparral Steel Company Stock Option
Plan of our report dated December 15, 1995, relating to the unaudited condensed
consolidated interim financial statements of Chaparral Steel Company and
subsidiaries which are included in its Form 10-Q for the quarter ended
November 30, 1995.
Pursuant to Rule 436(c) of the Securities Act of 1933 our report is not a part
of the Registration Statement prepared or certified by accountants within the
meaning of Section 7 or 11 of the Securities Act of 1933.
/s/ ERNST AND YOUNG LLP
Ernst and Young LLP
Dallas, Texas
January 9, 1996
13
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAY-31-1996
<PERIOD-END> NOV-30-1995
<CASH> 21,863
<SECURITIES> 0
<RECEIVABLES> 53,845
<ALLOWANCES> 2,703
<INVENTORY> 106,865
<CURRENT-ASSETS> 192,649
<PP&E> 507,678
<DEPRECIATION> 289,143
<TOTAL-ASSETS> 475,881
<CURRENT-LIABILITIES> 65,373
<BONDS> 80,963
<COMMON> 2,994
0
0
<OTHER-SE> 274,461
<TOTAL-LIABILITY-AND-EQUITY> 475,881
<SALES> 293,131
<TOTAL-REVENUES> 293,131
<CGS> 233,448
<TOTAL-COSTS> 233,448
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 240
<INTEREST-EXPENSE> 5,238
<INCOME-PRETAX> 28,000
<INCOME-TAX> 11,087
<INCOME-CONTINUING> 16,913
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 16,913
<EPS-PRIMARY> .35
<EPS-DILUTED> .35
</TABLE>
