<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1996
COMMISSION FILE NUMBER 1-10863
YORK INTERNATIONAL CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 13-3473472
(STATE OF INCORPORATION) (I.R.S. EMPLOYER IDENTIFICATION NO.)
631 SOUTH RICHLAND AVENUE, YORK, PA 17403
(717) 771-7890
(ADDRESS AND TELEPHONE NUMBER OF PRINCIPAL EXECUTIVE OFFICES)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
----- -----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at November 1, 1996
----- -------------------------------
Common Stock, par value $.005 43,347,758 shares
<PAGE>
-2-
YORK INTERNATIONAL CORPORATION AND SUBSIDIARIES
Form 10-Q
For the quarterly period ended September 30, 1996
INDEX
-----
Page No.
Part I. Financial Information
Item 1. Financial Statements
Consolidated Condensed Statements of Operations
(Unaudited) - Nine Months and Three Months 3
Ended September 30, 1996 and 1995
Consolidated Condensed Balance Sheets -
September 30, 1996 (Unaudited) and December 31, 1995 4
Consolidated Condensed Statements of Cash Flows
(Unaudited) - Nine Months Ended September 30, 1996
and 1995 5
Supplemental Notes to Consolidated Condensed
Financial Statements (Unaudited) 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
Part II. Other Information
Item 1. Legal Proceedings 11
Item 2. Changes in Securities 11
Item 3. Defaults Upon Senior Securities 11
Item 4. Submission of Matters to a Vote of Security Holders 11
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 12
<PAGE>
-3-
PART I - FINANCIAL INFORMATION
------------------------------
YORK INTERNATIONAL CORPORATION AND SUBSIDIARIES
Item 1
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)
Consolidated Condensed Statements of Operations (Unaudited)
- -----------------------------------------------------------
(thousands except per share data)
<TABLE>
<CAPTION>
Nine Months Ended Sept. 30, Three Months Ended Sept. 30,
--------------------------- ----------------------------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales $ 2,377,130 $ 2,098,293 $ 787,303 $ 718,956
Cost of goods sold 1,860,694 1,640,195 618,486 565,203
--------- --------- ------- -------
Gross profit 516,436 458,098 168,817 153,753
Selling, general and
administrative expenses 324,408 279,785 105,775 92,439
------- ------- ------- ------
Income from operations before
purchase accounting amortization 192,028 178,313 63,042 61,314
Purchase accounting amortization 7,398 9,857 2,542 3,285
----- ----- ----- -----
Income from operations 184,630 168,456 60,500 58,029
Interest expense, net 25,201 32,179 7,665 9,543
Equity in (earnings) losses of affiliates 208 3,217 (602) 2,409
--- ----- ----- -----
Income before income taxes 159,221 133,060 53,437 46,077
Provision for income taxes 50,564 48,776 14,598 16,127
------ ------ ------ ------
Net income $ 108,657 $ 84,284 $ 38,839 $ 29,950
========= ========= ======= =======
Earnings per share of common stock $ 2.48 $ 2.11 $ 0.88 $ 0.70
====== ====== ====== ======
Cash dividends per share $ 0.27 $ 0.18 $ 0.09 $ 0.06
====== ====== ====== ======
Weighted average common shares
and common equivalents outstanding
(in thousands) 43,832 40,027 44,035 42,974
</TABLE>
See accompanying supplemental notes to consolidated condensed financial
statements.
<PAGE>
-4-
PART I - FINANCIAL INFORMATION
------------------------------
YORK INTERNATIONAL CORPORATION AND SUBSIDIARIES
Consolidated Condensed Balance Sheets
- -------------------------------------
(thousands of dollars)
<TABLE>
<CAPTION>
ASSETS
Sept. 30, 1996 December 31,
Current Assets: (Unaudited) 1995
------------- ------------
<S> <C> <C>
Cash and cash equivalents $ 5,017 $ 8,838
Receivables 554,350 554,557
Inventories:
Raw materials 180,588 157,514
Work in process 142,364 117,308
Finished goods 287,240 243,161
------- -------
Total inventories 610,192 517,983
------- -------
Prepayments and other current assets 92,996 98,133
------- -------
Total current assets 1,262,555 1,179,511
Deferred income taxes 21,057 22,425
Unallocated excess of cost
over net assets acquired 345,813 350,268
Investments in affiliates 20,881 16,694
Property, plant and equipment, net 351,641 332,088
Deferred charges and other assets 24,302 26,016
------ ------
Total assets $ 2,026,249 $ 1,927,002
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable and current portion
of long-term debt $ 64,729 $ 86,108
Accounts payable and accrued expenses 639,765 664,490
Income taxes 41,699 35,850
------- ----------
Total current liabilities 746,193 786,448
Warranties 32,775 27,943
Long-term debt 329,252 314,246
Postretirement benefit liabilities 127,961 124,634
Other long-term liabilities 52,018 48,917
--------- ----------
Total liabilities 1,288,199 1,302,188
Stockholders' equity 738,050 624,814
--------- ----------
Total liabilities and stockholders' equity $ 2,026,249 $ 1,927,002
========== ==========
</TABLE>
See accompanying supplemental notes to consolidated condensed financial
statements.
<PAGE>
-5-
PART I - FINANCIAL INFORMATION
------------------------------
YORK INTERNATIONAL CORPORATION AND SUBSIDIARIES
Consolidated Condensed Statements of Cash Flows (Unaudited)
- -----------------------------------------------------------
(thousands of dollars)
<TABLE>
<CAPTION>
Nine Months Ended Sept. 30,
---------------------------
1996 1995
---- ----
Cash flows from operating activities:
<S> <C> <C>
Net income $ 108,657 $ 84,284
Adjustments to reconcile net income to net cash
provided (used) by operating activities:
Depreciation and amortization 36,050 30,180
Amortization of deferred charges 11,853 15,262
Provision for doubtful accounts receivable 5,252 3,805
Other 8,372 6,600
Change in assets and liabilities net of
effects from purchase of other companies:
Receivables (4,541) (21,731)
Inventories (92,036) (84,743)
Prepayments and other current assets 15,814 (901)
Deferred income taxes 1,437 (7,218)
Other assets (3,311) 64,795
Accounts payable and accrued expenses (26,603) 2,597
Income taxes (4,647) 10,994
Warranties 4,856 3,362
Post-retirement benefit liabilities 3,327 4,441
Other long-term liabilities (2,169) (7,609)
------- -------
Net cash provided by operating activities 62,311 104,118
------- -------
Cash flows from investing activities:
Payment for purchases of and investments in
other companies (net of cash acquired) (2,903) (260,321)
Capital expenditures (53,555) (47,727)
Other 941 220
------- --------
Net cash used by investing activities (55,517) (307,828)
------- --------
Cash flows from financing activities:
Common stock issued 9,185 200,151
Treasury stock purchased (1,739) (3)
Proceeds from issuance of long term debt - 177,060
Long-term debt payments (11,953) (150,000)
(Payments) on short term debt (21,379) (14,254)
Net proceeds from issuance of commercial paper 26,959 -
Dividends paid (11,692) (7,387)
------- --------
Net cash provided (used) by financing activities (10,619) 205,567
------- -------
Effect of exchange rate changes on cash 4 (17)
------- -------
Net increase (decrease) in cash and cash equivalents (3,821) 1,840
Cash and cash equivalents at beginning of period 8,838 5,915
------- -------
Cash and cash equivalents at end of period $ 5,017 $ 7,755
======= =======
</TABLE>
See accompanying supplemental notes to consolidated condensed financial
statements.
<PAGE>
-6-
YORK INTERNATIONAL CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited)
(1) The consolidated condensed financial statements included herein have been
prepared by the Registrant pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
condensed or omitted pursuant to applicable rules and regulations, although
the registrant believes that the disclosures herein are adequate to make
the information presented not misleading. In the opinion of the Company,
the accompanying consolidated condensed financial statements contain all
adjustments (consisting of only normally recurring accruals) necessary to
present fairly the financial position as of September 30, 1996 and December
31, 1995, the results of operations for the three and nine month periods
ended September 30, 1996 and 1995, and the cash flows for the nine months
ended September 30, 1996 and 1995.
(2) The results of operations for interim periods are not necessarily
indicative of the results expected for the full year.
(3) The following tables summarize the capitalization of the Company at
September 30, 1996 and at December 31, 1995 (in thousands of dollars):
<TABLE>
<CAPTION>
Sept. 30, 1996 December 31, 1995
-------------- -----------------
Current Long Term Current Long Term
------- --------- ------- ---------
<S> <C> <C> <C> <C>
Indebtedness:
Bank loans $ 58,591 $ - $ 78,999 $ -
Other 6,138 42,674 7,109 53,775
Senior notes - 100,000 - 100,000
Term loans - 114,829 - 115,681
Commercial paper - 71,749 - 44,790
------- -------- ------- --------
Total notes payable and
long-term debt $ 64,729 $ 329,252 $ 86,108 $ 314,246
======= ======== ======= =======
<CAPTION>
Sept. 30, December 31,
1996 1995
------ ------
<S> <C> <C>
Stockholders' equity:
Common Stock $.005 par value; 200,000,000 shares
authorized; issued 43,435,000 shares at September 30,1996
and 43,126,000 shares at December 31, 1995 $ 217 $ 216
Additional paid in capital 658,564 644,377
Retained earnings 110,989 14,024
Currency translation adjustment (20,794) (22,426)
Treasury stock, 93,269 shares at September 30, 1996
and 52,506 shares at December 31, 1995, at cost (3,648) (1,909)
Unearned compensation (7,278) (9,468)
------ ------
Total stockholders' equity $ 738,050 $ 624,814
======= =======
</TABLE>
(continued)
<PAGE>
-7-
YORK INTERNATIONAL CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited)
At September 30, 1996 and December 31, 1995, the Company maintained a $350
million revolving credit facility pursuant to an Amended and Restated Credit
Agreement (the Agreement) expiring on July 31, 2000. The facility was amended
and restated on July 21, 1995. At September 30, 1996 and December 31, 1995,
no amounts were outstanding under the facility. The Agreement provides for
borrowings under the facility at LIBOR plus .20% or at bid rates as specified
in the Agreement. At September 30, 1996 and December 31, 1995 the LIBOR rate
was 5.62% and 5.78%, respectively. A fee of .10% is paid on the unused
facility. The Agreement, as amended, contains financial and operating
covenants requiring the Company to maintain certain financial ratios and
restricting its ability to incur indebtedness, make investments and create or
permit to exist certain liens.
The Company's non-U.S. subsidiaries maintain bank credit facilities in
various currencies that provided for borrowings of $252.4 million and $266.8
million at September 30, 1996 and December 31, 1995, respectively, of which
$161.7 million and $163.6 million, respectively, were unused. In some
instances, borrowings against these credit facilities have been guaranteed by
the Company to assure availability of funds at favorable rates.
The Company established a commercial paper facility in November, 1995.
Commercial paper borrowings are expected to be reborrowed in the ordinary
course of business. The average interest rate on the commercial paper was
5.47% and 5.88% as of September 30, 1996 and December 31, 1995, respectively.
During 1995, the Company arranged two term loans denominated in foreign
currencies. The Company borrowed $26.2 million with a final maturity on
November 15, 1998 and an interest rate of 3.98%. The loan is repayable in
four annual installments. On December 21, 1995, the Company borrowed $100
million with an interest rate of 4.87%, which matures on December 14, 2000.
All principal and interest payments for the five year term were swapped to
U.S. dollars at inception. The term loan agreements contain financial and
operating covenants that are equivalent to the covenants of the Company's
Amended and Restated Credit Agreement.
In July 1995, the Company registered $200 million in debt securities with the
Securities and Exchange Commission. Under terms of the registration
statement, the Company may offer and sell up to that amount of such
securities at prices and terms to be determined at or prior to sale. No
amounts of such debt securities are outstanding at September 30, 1996 or
December 31, 1995.
Under a receivables sales agreement, the Company sold a fractional ownership
interest in a defined pool of trade accounts receivable for $100 million in
1996 and 1995. The sold accounts receivable are reflected as a reduction of
receivables in the accompanying consolidated balance sheets. Under this
agreement, the maximum amount of the purchasers' investment is currently $100
million and is subject to decrease based on the level of eligible accounts
receivable and restrictions on concentrations of receivables. The discount
rate on the receivables sold at September 30, 1996 and December 31, 1995 was
approximately 5.40% and 5.76%, respectively.
During May 1995, the Stockholders approved the Amended and Restated 1992
Omnibus Stock Plan authorizing the issuance of up to 3,000,000 shares of the
Company's common stock as stock options or restricted share awards. The
exercise price of the stock options granted under this plan is not less than
the fair market value of the shares on the date the option is granted. The
restricted shares are granted at a price determined by the Board of
Directors. In March, 1996, key employees were awarded 787,280 stock options
at an exercise price of $46.75 per share.
(continued)
<PAGE>
-8-
YORK INTERNATIONAL CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited)
(4) Purchase accounting amortization primarily represents the amortization of
the unallocated excess of cost over net assets acquired, incurred in
connection with the acquisition of the Company in 1988.
(5) The Company's earnings per share are based on the weighted average
outstanding common shares and common share equivalents.
(6) Acquisitions
On July 31, 1996, the Company acquired the outstanding shares of Northfield
Equipment and Manufacturing Company (NEMCO), located in Northfield,
Minnesota. NEMCO designs and manufactures food processing freezing
equipment.
On July 29, 1995, the Company acquired the outstanding shares of Northfield
Freezing Systems, Inc. (NFS), located in Northfield, Minnesota. NFS
develops, designs, sells and services food processing freezing equipment.
On July 5, 1995, the Company and a Thai partner formed a manufacturing
joint venture in Thailand. The Company has a 67% interest in this joint
venture which acquired the operating assets of the partner's existing
facility. The venture will produce residential air conditioning products
for distribution primarily in markets outside of North America.
On May 31, 1995, the Company acquired two divisions of Gram A/S, Gram
Refrigeration and Gram Contractors, headquartered in Vojens, Denmark (Gram
Divisions). The Gram Divisions develop, manufacture, sell and service
components for industrial refrigeration worldwide.
On May 25, 1995, the Company purchased an additional 20% interest in
Taiwan-YORK Company, Inc. raising the Company's ownership from 40% to 60%.
On May 3, 1995, Bristol Compressors, Inc., a subsidiary of the Company,
formed a partnership to operate a new joint venture for the development and
production of scroll compressors. The joint venture, called Scroll
Technologies, is a partnership which owns and operates a scroll compressor
plant.
On April 19, 1995, the Company formed a joint venture with a partner in the
People's Republic of China ("P.R.C.") for the manufacture of certain
commercial air conditioning products in the P.R.C.
On March 1, 1995, the Company acquired all of the capital stock of Evcon
Holdings, Inc., which was the sole shareholder of Evcon Industries, Inc.,
("Evcon") that designs, manufactures and supplies air conditioning, heating
and air handling equipment for the residential, manufactured housing and
light commercial markets. Evcon is based in Wichita, Kansas where it
maintains manufacturing facilities.
In January 1995, the Company acquired the assets of Mining and Industrial
Air Conditioning (Pty) Ltd. ("MIAC"), based in Johannesburg, South Africa.
MIAC is a design engineering, supplier and service company to the mining
and process refrigeration industries, as well as a supplier to air
conditioning contractors. The Company also acquired a 50% interest in a
joint venture with Compania Roca Radiadores S.A., located in Sabadell,
Spain and known as Clima Roca York ("Roca"). Roca manufactures residential
and commercial air conditioning products in Spain and distributes air
conditioning products throughout Western Europe.
(7) Reference is made to the Registrant's 1995 Annual Report on Form 10-K for
more detailed financial statements and footnotes.
<PAGE>
-9-
YORK INTERNATIONAL CORPORATION AND SUBSIDIARIES
Item 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
Results of Operations
- ---------------------
Net sales for the three months ended September 30, 1996 increased 9.5% to
$787.3 million as compared to $719.0 million for the three months ended
September 30, 1995. Income from operations for the third quarter of 1996 was
$60.5 million compared to $58.0 million for the third quarter of 1995. Net
sales for the nine months ended September 30, 1996 increased 13.3% to
$2,377.1 million as compared to $2,098.3 million for the nine months ended
September 30, 1995. Income from operations for the first nine months of 1996 was
$184.6 million as compared to $168.5 million for the first nine months of 1995.
For the first nine months of 1996 as compared with the same period in 1995,
revenues for the Company's commercial, residential and refrigeration products
showed an increase. The increase in commercial revenue was due primarily to
increased volume of service and repair business and favorable market conditions
in the international marketplace. Residential product revenue increased slightly
as a result of increased sales volume due to favorable market conditions and new
product introductions partially offset by a weak market in Europe due to a cool
summer. Refrigeration product revenue was up mainly due to a strong U.S. market
partially offset by weak markets in Germany and France.
For the third quarter, aggregate non-U.S. sales increased 13.1% from the third
quarter of 1995 to $348.2 million primarily as a result of increased commercial
markets and favorable conditions in the Asia-Pacific and Latin American markets,
partially offset by weakening economic conditions in the European markets.
Domestic revenue increased 6.9% to $439.1 million primarily as a result of
strong commercial sales, increased volume in the service and repair business and
increased refrigeration revenue.
Equipment order backlog at September 30, 1996 was $911 million which is 3.0%
less than one year ago and 1.4% above the $899 million backlog at December 31,
1995. Domestic backlog is down 13.0% and international backlog is up 0.9% from
the third quarter of 1995. The decrease in the domestic backlog resulted from
changes in timing of order placement and a less robust growth in U.S. markets.
Other factors are the replacement chiller market and flat international
refrigeration orders. Internationally, the Company's backlog outperformed the
marketplace as a result of continued improvement in the Company's worldwide
distribution system.
The following table sets forth third quarter revenue by product and geographic
market (in thousands):
<TABLE>
<CAPTION>
Three months ended Sept. 30,
----------------------------
1996 1995
------ ------
<S> <C> <C>
Commercial products $ 342,071 $ 318,511
Residential products 252,172 247,196
Refrigeration products 193,060 153,249
-------- --------
Total revenue $ 787,303 $ 718,956
======== =======
U.S. 56% 57%
International 44% 43%
---- ----
Total 100% 100%
==== ====
</TABLE>
(continued)
<PAGE>
-10-
YORK INTERNATIONAL CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Gross profit in the third quarter of 1996 increased 9.8% to $168.8 million or
21.4% of net sales as compared to $153.8 million or 21.4% of net sales for the
1995 period. Gross profit for the nine month period increased 12.7% to $516.4
million or 21.7% of net sales as compared to $458.1 million or 21.8% of net
sales for the same period in 1995. Gross profit for the third quarter was
impacted primarily by realized price increases and new product introductions,
partially offset by inflationary cost increases and production cost increases.
Selling, general and administrative expenses in the third quarter of 1996 were
$105.8 million, 13.4 % of net sales, versus $92.4 million, 12.9% of net sales,
in 1995. Selling, general, and administrative expenses for the nine months
ended September 30, 1996 of $324.4 million were 13.6% of net sales as compared
to 13.3% of net sales for the same nine month period in 1995. The increase as a
percent of net sales is due to increased expenditures on infrastructure in the
international locations, costs associated with new product introductions, cost
associated with bringing acquired companies up to York's reporting and operating
standards, and increased research and development costs.
Interest expense during the third quarter decreased to $7.7 million in 1996
from $9.5 million in 1995. This was a result of decreased domestic interest
rates in 1996 and slightly lower average borrowings.
The provision for income taxes of $14.6 million in the third quarter of 1996
relates both to U.S. and non-U.S. operations. This decrease in the effective tax
rate is primarily the result of the benefit of increased export incentives and
utilization of foreign tax credits. These benefits were partially offset by the
tax impact of nondeductible items, including the amortization of goodwill.
As a result of the above factors, the Company had a net income of $38.8 million
in the third quarter of 1996 as compared to net income of $30.0 million in the
third quarter of 1995, an increase of 29.7%.
Liquidity and Capital Resources
- -------------------------------
Working capital requirements are generally met through a combination of
internally generated funds, bank lines of credit, commercial paper issuances,
financing of trade receivables and credit terms from suppliers which approximate
receivable terms from the Company's customers. The Company believes that its
bank lines of credit under its 1995 Amended and Restated Credit Agreement will
be sufficient to meet working capital needs through 1996. Additional sources of
working capital include customer deposits and progress payments.
The Company had working capital of $516.4 million and $393.1 million as of
September 30, 1996 and December 31, 1995, respectively. The current ratio was
1.69 at September 30, 1996 as compared to 1.50 at December 31, 1995.
At September 30, 1996, the Company maintained a $350 million Amended and
Restated Credit Agreement (the Agreement) expiring on July 31, 2000. The
Agreement was amended and restated on July 21, 1995. At September 30, 1996 and
December 31, 1995 the Company could borrow $350 million. The Agreement provides
for borrowings under the facility at LIBOR plus .20% or at bid rates as
specified in the Agreement. At September 30, 1996 the LIBOR rate was 5.62%. A
fee of .10% is paid on the unused facility. The Agreement, as amended, contains
financial and operating covenants requiring the Company to maintain certain
financial ratios and restricting its ability to incur indebtedness, make
investments and create or permit to exist certain liens.
Commercial paper borrowings are expected to be reborrowed in the ordinary
course of business. The average interest rate on the commercial paper was 5.47%
as of September 30, 1996.
The term loans mature at various dates to December 31, 2000 and bear interest
at rates from 3.98% to 4.87%. The term loan agreements contain financial and
operating covenants that are equivalent to the covenants of the Company's
Amended and Restated Credit Agreement.
The $100 million of Senior Notes bear interest at 6.75% fixed rate and have a
maturity of ten years from the date of issue.
(continued)
<PAGE>
-11-
YORK INTERNATIONAL CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The Company sold a fractional ownership interest in a defined pool of trade
accounts receivable for $100 million. At September 30, 1996, the discount rate
on the accounts receivable sold was approximately 5.40%.
In July 1995, the Company registered $200 million in debt securities with the
Securities and Exchange Commission. Under terms of the registration statement,
the Company may offer and sell up to that amount of such securities from time to
time at prices and terms to be determined at or prior to sale. No amounts of
such debt securities are outstanding at September 30, 1996.
Because the Company's obligations under the Amended and Restated Credit
Agreement and Receivables Sales Agreement bear interest at floating rates, the
Company's interest costs are sensitive to changes in prevailing interest rates.
Based on historical cash flows, the Company believes that it will be able to
satisfy its interest payment obligations under the Amended and Restated Credit
Agreement and its working capital and capital expenditure requirements from
operating cash flows together with funds available under the revolving credit
facility.
In the ordinary course of business the Company enters into various types of
transactions that involve contracts and financial instruments with off-balance-
sheet risk. The Company enters into these financial instruments to manage
financial market risk, including foreign exchange, commodity price and interest
rate risk. The Company enters into these financial instruments utilizing over-
the-counter as opposed to exchange traded instruments. The Company mitigates
the risk that counterparties to these over-the-counter agreements will fail to
perform by only entering into agreements with major international financial
institutions.
Capital expenditures currently anticipated for expanded capacity, cost
reductions and the introduction of new products during the next twelve months
will be in excess of depreciation and amortization. These expenditures will be
funded from a combination of operating cash flows and funds available under the
revolving credit facility or commercial paper.
Cash dividends of $0.09 per share were paid on common stock in the third
quarter of 1996. The declaration and payment of future dividends will be at the
sole discretion of the Board of Directors and will depend upon such factors as
the Company's profitability, financial condition, cash requirements and future
prospects.
PART II-Other Information
Item 1 Legal Proceedings
Not Applicable
Item 2 Changes in Securities
Not Applicable
Item 3 Defaults Upon Senior Securities
Not Applicable
Item 4 Submission of Matters to a Vote of Security Holders
Not Applicable
<PAGE>
-12-
YORK INTERNATIONAL CORPORATION AND SUBSIDIARIES
PART II-Other Information
Item 5 Other Information
Not Applicable
Item 6 Exhibits and Reports on Form 8-K
(a) Exhibit 27 Financial Data Schedule (EDGAR only)
(b) None
<PAGE>
-13-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned unto duly authorized.
YORK INTERNATIONAL CORPORATION
------------------------------
Registrant
Date November 1, 1996 /S/ Dean T. DuCray
------------------- ------------------------------------------
Vice President and Chief Financial Officer
<PAGE>
-14-
EXHIBIT INDEX
- -------------
Exhibit No. Description
- ----------- ----------------------------------------------------------
27 Financial Data Schedule (EDGAR only)
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1996 (UNAUDITED), THE CONSOLIDATED CONDENSED BALANCE SHEETS
AT SEPTEMBER 30, 1996 (UNAUDITED), AND THE CONSOLIDATED CONDENSED
STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996
(UNAUDITED) AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 5,017
<SECURITIES> 0
<RECEIVABLES> 524,498
<ALLOWANCES> 19,158
<INVENTORY> 610,192
<CURRENT-ASSETS> 1,262,555
<PP&E> 615,345
<DEPRECIATION> 263,704
<TOTAL-ASSETS> 2,026,249
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0
0
<COMMON> 217
<OTHER-SE> 737,833
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<TOTAL-REVENUES> 2,377,130
<CGS> 1,860,694
<TOTAL-COSTS> 1,860,694
<OTHER-EXPENSES> 0
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<INTEREST-EXPENSE> 25,201
<INCOME-PRETAX> 159,221
<INCOME-TAX> 50,564
<INCOME-CONTINUING> 108,657
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<EXTRAORDINARY> 0
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<NET-INCOME> 108,657
<EPS-PRIMARY> 2.48
<EPS-DILUTED> 2.48
</TABLE>
