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
or
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended September 28, 1996
PLAYTEX PRODUCTS, INC.
(Exact name of registrant as specified in its charter)
Delaware 33-25485-01 51-0312772
(State or other jurisdiction of (Commission File No.) (I.R.S. Employer
incorporation or organization) Identification No.)
300 Nyala Farms Road
Westport, Connecticut 06880
(203) 341 - 4000
----------------------------------------
(Address, including zip code, and
telephone number, including area
code, 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
registrants were required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
At November 12, 1996, 50,887,200 shares of Playtex Products, Inc. common
stock, par value of $.01 per share, were outstanding.
<PAGE>
PLAYTEX PRODUCTS, INC.
INDEX
PAGE
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements 3 - 10
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 11 - 13
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 14
Item 6. Exhibits and Reports on Form 8-K:
(a) Exhibits 14
(b) Reports on Form 8-K 14
Signatures 15
-2-
<PAGE>
PLAYTEX PRODUCTS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
<TABLE>
<CAPTION>
September 28, December 30,
ASSETS 1996 1995
------------- ------------
(Unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 7,059 $ 5,940
Receivables, less allowance for doubtful accounts 63,625 58,019
Inventories 33,541 49,190
Current deferred taxes 12,681 13,154
Other current assets 1,894 4,545
--------- ---------
Total current assets 118,800 130,848
Net property, plant and equipment 52,833 52,462
Intangible assets, net:
Goodwill 351,153 359,629
Patents, trademarks and other 36,787 38,076
Deferred financing costs 15,912 17,426
Due from related party 80,017 80,017
Other noncurrent assets 4,182 4,403
--------- ---------
Total assets $ 659,684 $ 682,861
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 15,446 $ 20,057
Accrued expenses 72,164 60,257
Income taxes payable 6,050 1,897
Current maturities of long-term debt 25,000 20,000
--------- ---------
Total current liabilities 118,660 102,211
Long-term debt 710,750 770,050
Due to related party 78,386 78,386
Other noncurrent liabilities 14,587 16,784
Deferred income taxes 21,364 16,406
--------- ---------
Total liabilities 943,747 983,837
Stockholders' equity:
Common stock, $.01 par value, authorized 100,000,000 shares,
issued 50,885,367 shares at September 28,1996 and 50,879,701
shares at December 30, 1995 509 509
Additional paid-in capital 424,262 424,217
Retained earnings (deficit) (707,039) (723,917)
Foreign currency translation adjustment (1,795) (1,785)
--------- ---------
Total stockholders' equity (deficit) (284,063) (300,976)
--------- ---------
Total liabilities and stockholders' equity $ 659,684 $ 682,861
========= =========
</TABLE>
See condensed notes to consolidated financial statements.
-3-
<PAGE>
PLAYTEX PRODUCTS, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited, in thousands, except per share data)
<TABLE>
<CAPTION>
Three Months Three Months
Ended Ended
September 28, September 30,
1996 1995 (a)
------------ ------------
<S> <C> <C>
Net sales $117,500 $111,744
Cost of sales 44,135 40,570
-------- --------
Gross profit 73,365 71,174
Operating expenses:
Advertising and sales promotion 25,430 25,794
Selling, distribution and research 14,005 12,879
Administrative 4,373 4,306
Amortization of intangibles 3,223 2,762
-------- --------
Total operating expenses 47,031 45,741
-------- --------
Operating earnings 26,334 25,433
Interest expense, net -- including related party interest
expense of $3,037 for both periods presented,
net of related party interest income of $3,001
for both periods presented 16,148 15,431
-------- --------
Earnings before income taxes 10,186 10,002
Income taxes 4,778 4,514
-------- --------
Net earnings $ 5,408 $ 5,488
======== ========
Weighted average common shares outstanding 50,885 50,880
======== ========
Earnings per share - primary and fully diluted $ .11 $ .11
======== ========
</TABLE>
(a) Certain prior year accounts have been reclassified for consistency with
the 1996 presentation.
See condensed notes to consolidated financial statements.
-4-
<PAGE>
PLAYTEX PRODUCTS, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited, in thousands, except per share data)
<TABLE>
<CAPTION>
Nine Months Nine Months
Ended Ended
September 28, September 30,
1996 1995 (a)
------------- ------------
<S> <C> <C>
Net sales $392,439 $ 380,138
Cost of sales 149,745 147,304
-------- ---------
Gross profit 242,694 232,834
Operating expenses:
Advertising and sales promotion 97,032 89,898
Selling, distribution and research 42,250 39,417
Administrative 12,877 12,448
Amortization of intangibles 9,625 8,180
-------- ---------
Total operating expenses 161,784 149,943
-------- ---------
Operating earnings 80,910 82,891
Interest expense, net -- including related party interest
expense of $9,113 for both periods presented,
net of related party interest income of $9,002
for both periods presented 49,110 55,067
-------- ---------
Earnings before income taxes and extraordinary loss 31,800 27,824
Income taxes 14,922 12,062
-------- ---------
Earnings before extraordinary loss 16,878 15,762
Extraordinary loss on early extinguishment of debt,
net of $5,180 tax benefit -- (7,935)
-------- ---------
Net earnings $ 16,878 $ 7,827
======== =========
Weighted average shares outstanding 50,883 39,451
======== =========
Earnings per share - primary and fully diluted
Before extraordinary loss $ .33 $ .40
======== =========
Net earnings $ .33 $ .20
======== =========
</TABLE>
(a) Certain prior year accounts have been reclassified for consistency with the
1996 presentation.
See condensed notes to consolidated financial statements.
-5-
<PAGE>
PLAYTEX PRODUCTS, INC.
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(Unaudited, in thousands)
<TABLE>
<CAPTION>
Foreign
Additional Retained Currency
Common Paid-In Earnings Translation
Stock Capital (Deficit) Adjustment
------ ---------- --------- -----------
<S> <C> <C> <C> <C>
Balance, December 30, 1995 $509 $424,217 $(723,917) $(1,785)
Net earnings -- -- 16,878 --
Shares issued for exercise of
stock options -- 45 -- --
Foreign currency translation adjustment -- -- -- (10)
---- -------- --------- -------
Balance, September 28, 1996 $509 $424,262 $(707,039) $(1,795)
==== ======== ========= =======
</TABLE>
See condensed notes to consolidated financial statements.
-6-
<PAGE>
PLAYTEX PRODUCTS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands)
<TABLE>
<CAPTION>
Nine Months Nine Months
Ended Ended
September 28, September 30,
1996 1995
------------- -------------
<S> <C> <C>
Cash flows from operations:
Net earnings $ 16,878 $ 7,827
Non-cash items included in earnings:
Extraordinary loss -- 7,935
Amortization of intangibles 9,625 8,180
Amortization of deferred financing costs 1,514 1,756
Depreciation 6,600 6,316
Deferred taxes 5,431 6,445
Other, net 269 110
Net decrease in working capital accounts 21,946 6,930
-------- ---------
Net cash flows from operations 62,263 45,499
-------- ---------
Cash flows used for investing activities:
Purchases of property, plant and equipment (6,880) (10,862)
Business acquired -- (21,660)
-------- ---------
Net cash flows used for investing activities (6,880) (32,522)
-------- ---------
Cash flows (used for) from financing activities:
Repayments under working capital facilities, net -- (47,700)
Long-term debt borrowings -- 387,500
Long-term debt payments (54,300) (468,000)
Payment of financing costs -- (8,800)
Issuance of common shares, net 45 169,300
Other, net (9) 194
-------- ---------
Net cash flows (used for) from financing activities (54,264) 32,494
-------- ---------
Increase in cash and cash equivalents 1,119 45,471
Cash and cash equivalents at beginning of period 5,940 10,373
-------- ---------
Cash and cash equivalents at end of period $ 7,059 $ 55,844
======== =========
Supplemental disclosures of cash flow information
Net cash paid during the periods for:
Interest $ 40,031 $ 43,103
======== =========
Income taxes, net of refunds $ 5,339 $ 10,188
======== =========
</TABLE>
See condensed notes to consolidated financial statements.
-7-
<PAGE>
PLAYTEX PRODUCTS, INC.
PART I - FINANCIAL INFORMATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Consolidated Financial Statements
The accompanying quarterly consolidated financial statements of Playtex
Products, Inc. ("Playtex" or the "Company") are unaudited; however, such
statements include all adjustments (consisting of normal recurring adjustments)
considered necessary in the opinion of management for fair presentation of the
financial position, results of operations and cash flows of the Company. The
results of the interim period ended September 28, 1996 are not necessarily
indicative of the results that may be expected for the full year.
The Company presumes the users of this Quarterly Report on Form 10 - Q have
read or have access to the audited financial statements contained in the
Company's Annual Report on Form 10 - K for the year ended December 30, 1995.
Accordingly, all footnote disclosures which would substantially duplicate the
disclosures contained therein have been omitted.
2. Balance Sheet Components
The components of certain balance sheet accounts are as follows (in
thousands):
September 28, December 30,
1996 1995
----------- ------------
(Unaudited)
Receivables $ 65,194 $ 60,061
Less allowance for doubtful accounts (1,569) (2,042)
--------- ---------
Net $ 63,625 $ 58,019
========= =========
Inventories:
Raw materials $ 13,333 $ 18,187
Work in process 1,083 1,267
Finished goods 19,125 29,736
--------- ---------
Total $ 33,541 $ 49,190
========= =========
Net property, plant and equipment:
Land $ 1,190 $ 1,190
Buildings 24,518 24,055
Machinery and equipment 93,626 86,955
--------- ---------
119,334 112,200
Less accumulated depreciation (66,501) (59,738)
--------- ---------
Net $ 52,833 $ 52,462
========= =========
-8-
<PAGE>
PLAYTEX PRODUCTS, INC.
PART I - FINANCIAL INFORMATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
2. Balance Sheet Components (continued) September 28, December 30,
1996 1995
----------- ------------
(Unaudited)
Goodwill $ 446,482 $ 446,482
Less accumulated amortization (95,329) (86,853)
--------- ---------
Net $ 351,153 $ 359,629
========= =========
Patents, trademarks and other $ 49,629 $ 49,769
Less accumulated amortization (12,842) (11,693)
--------- ---------
Net $ 36,787 $ 38,076
========= =========
Deferred financing costs $ 19,463 $ 19,463
Less accumulated amortization (3,551) (2,037)
--------- ---------
Net $ 15,912 $ 17,426
========= =========
Accrued expenses:
Advertising and sales promotion $ 24,833 $ 29,401
Interest 13,885 6,320
Employee compensation and benefits 11,352 10,162
Insurance 5,841 4,858
Accrued returns reserve 8,447 500
Other 7,806 9,016
--------- ---------
Total $ 72,164 $ 60,257
========= =========
3. Long-Term Debt
Long-term debt consists of the following (in thousands):
September 28, December 30,
1996 1995
------------ ------------
(Unaudited)
1995 Credit Agreement:
1995 Term Loan Facility $ 367,500 $ 387,500
1995 Acquisition Credit Facility 7,500 37,500
1995 Working Capital Facility 750 5,050
9% Senior Subordinated Notes due 2003 360,000 360,000
--------- ---------
735,750 790,050
Less current maturities (25,000) (20,000)
--------- ---------
Total long-term debt $ 710,750 $ 770,050
========= =========
-9-
<PAGE>
PLAYTEX PRODUCTS, INC.
PART I - FINANCIAL INFORMATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
3. Long-Term Debt (continued)
The 1995 Term Loan Facility provides for semi-annual repayment of
principal, including payments of $12.5 million due on March 15, 1997 and $12.5
million on September 15, 1997. The rate of interest on borrowings under the 1995
Credit Agreement is, at the Company's option, a function of various alternative
short-term borrowing rates, as defined in the 1995 Credit Agreement. At
September 28, 1996 and September 30, 1995, the weighted average variable
interest rate was 7.39% and 7.34%, respectively. In addition, the weighted
average variable interest rate for borrowing under the Credit Agreements was
7.35% and 8.25%, and 7.34% and 7.41% for the nine month and three month periods
ended September 28, 1996 and September 30, 1995, respectively. Quarterly
commitment fees of three-eighths of 1% on the unutilized portion of the 1995
Credit Agreement and an agency fee of $100,000 per annum are also required. At
September 28, 1996, aggregate unused lines of credit (giving effect to
outstanding letters of credit) under the 1995 Credit Agreement amounted to
$102.8 million.
The provisions of the 1995 Credit Agreement require the Company to meet
certain financial covenants and ratios and also include limitations or
restrictions on: new indebtedness and liens; major acquisitions or mergers;
capital expenditures; disposition of assets; certain dividends and other
distributions; and prepayment and modification of all indebtedness or equity
capitalization. The 9% Senior Subordinated Notes (the "9% Notes") contain
certain similar restrictions and requirements. Under the terms of the 1995
Credit Agreement and the 9% Notes, payment of cash dividends on the common stock
of the Company is restricted.
4. Earnings Per Share
Earnings per share is calculated using net earnings divided by the weighted
average number of common shares issued and outstanding and common stock
equivalents for the periods presented. At September 28, 1996 and at December 30,
1995, no shares of common stock were held in treasury.
5. Contingent Liabilities
In the opinion of management, there are no claims, commitments, guarantees
or litigation pending to which the Company or any of its subsidiaries is a party
which would have a materially adverse effect on the consolidated financial
position, results of operations or cash flows of the Company.
-10-
<PAGE>
PLAYTEX PRODUCTS, INC.
PART I - FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
The following discussion and analysis of the Company's financial condition
and results of operations should be read in conjunction with the financial data
and condensed notes thereto included elsewhere in this quarterly report and with
the Annual Report on Form 10-K for the year ended December 30, 1995 filed with
the Securities and Exchange Commission (No. 33-25485).
Certain statements in this Quarterly Report or others made hereafter
(including orally) may constitute "forward looking statements" within the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors
which may cause actual results, performance or achievements of the Company to be
materially different from any future results, performance or achievements
expressed or implied by such forward looking statements. Such factors include
but are not limited to: intensified competition, higher spending for advertising
and promotion, new product initiatives and continued activity in the private
label sector, the loss of significant customers, product liability litigation
and changes in governmental regulations.
Results of Operations
Three Months Ended September 28, 1996 Versus
Three Months Ended September 30, 1995:
Net Sales - Net sales of $117.5 million for the quarter ended September 28,
1996 were $5.8 million, or 5.2%, higher than for the same quarter in fiscal
1995. This increase in net sales was related primarily to higher sales in Infant
Care of $29.1 million, up 26.3%, led by the continued strength of the Playtex
Spill-Proof cup. Sun Care net sales increased 147.9% to $7.2 million.
Additionally, Household Product net sales of $16.5 million increased 3.4% versus
the same period in 1995. Feminine Care net sales of $57.1 million were $0.1
million higher than the same period of 1995. Hair Care net sales of $6.3 million
decreased 46.0% versus the third quarter of 1995.
Gross Profit - Gross profit as a percent of sales for the quarter was
62.4%, down 1.3% of sales versus the same period in 1995. This decrease is
primarily attributable to product sales mix favorably offset by lower product
costs.
Operating Earnings - Operating earnings of $26.3 million for the third
quarter of 1996 were $0.9 million, or 3.5%, higher than for the comparable
period in fiscal 1995. The most significant factor contributing to the increase
in operating earnings was the increase in net sales versus the same period in
1995. Also contributing to the increase in operating earnings was a decrease of
$0.4 million, or 1.4%, in advertising and promotional spending.
Interest Expense - Interest expense increased $0.7 million, or 4.6%. The
average debt balance and average interest rates for both periods were
comparable.
Net Earnings - Net earnings of $5.4 million for the third quarter of fiscal
1996 were $0.1 million, or 1.5%, lower than for the same quarter in fiscal 1995.
The difference resulted from the combined effect of all factors described
above.
-11-
<PAGE>
PLAYTEX PRODUCTS, INC.
PART I - FINANCIAL INFORMATION
Nine Months Ended September 28, 1996 Versus
Nine Months Ended September 30, 1995:
Net Sales - Net sales of $392.4 million for the nine months ended September
28, 1996 were $12.3 million, or 3.2%, higher than for the same period in fiscal
1995. Net sales of the Company's Feminine Care products of $169.6 million were
down $8.2 million, or 4.6%, versus the first nine months of 1995. Sun Care net
sales increased $14.9 million, or 27.0% to $69.8 million. Excluding the impact
of the BBH Acquisition, which occurred in the fourth quarter of 1995, Sun Care
net sales increased 9.9%. Infant Care net sales of $82.9 million continued to
show growth, with a $15.0 million, or 22.2% increase over the nine months ended
September 30, 1995. Additionally, versus the same period in 1995, Household
Product net sales increased 8.9% to $46.4 million, due in part to the impact of
a full nine months of net sales in 1996 of the Woolite rug and upholstery
cleaning business ("Woolite"). Hair Care net sales of $20.0 million decreased
39.1% versus the first nine months of fiscal 1995.
Gross Profit - Gross profit as a percent of sales was 61.8%, an increase of
0.6% of sales versus the same period in 1995. This increase was primarily
attributable to favorable product sales mix and increased margin on sun care
products as a result of the BBH Acquisition. This increase in Sun Care margin
was partially tempered due to the impact of a $1.8 million non-cash acquisition
accounting adjustment as required by Accounting Principles Board Opinion No. 16
- - "Business Combinations".
Operating Earnings - Operating earnings of $80.9 million for the nine
months of 1996 were $2.0 million, or 2.4%, lower than for the comparable period
in fiscal 1995. Operating earnings were favorably impacted by the increase in
net sales and gross profit. However, these gains were more than offset by a 7.9%
increase in advertising and promotional spending. Also contributing to the
decrease in operating margin were increases in certain other operating expenses,
attributable primarily to the Woolite and BBH acquisitions.
Interest Expense - Interest expense decreased $6.0 million or 10.8%. This
decrease resulted from lower interest rates in the first nine months of fiscal
1996 versus fiscal 1995 and the reduction in average long-term debt (including
current portion) versus the comparable period in 1995. The decrease in the
long-term debt was primarily the result of an equity infusion from the
Investment and the new credit agreement with Chase Manhattan Bank (formerly
Chemical Bank) in June 1995, partly offset by the financing of the BBH
Acquisition.
Net Earnings Before Extraordinary Loss - Net earnings before extraordinary
loss of $16.9 million for the first nine months of fiscal 1996 were $1.1
million, or 7.1%, higher than for the same period in fiscal 1995. The favorable
variance resulted from the combined effect of all factors described above. In
the second quarter of 1995, the Company recorded a $7.9 million extraordinary
loss on early extinguishment of debt, net of $5.2 million of related tax
benefits.
Financial Condition
At September 28, 1996, the Company's working capital decreased by $28.5
million to $0.1 million from $28.6 million at December 30, 1995. The major
factors that contributed to this change were as follows: a) inventory decreased
$15.6 million, due primarily to the sell off of the seasonal Sun Care inventory
and promotional tampon inventory built in the fourth quarter of 1995, b) an
$11.9 million increase in accrued expenses resulting almost entirely from the
increased accrued returns for seasonal Sun Care products versus the balance at
year end 1995 and accrued interest on debt, c) a $4.2 million increase in income
taxes payable, primarily the result of the difference in earnings for the third
quarter of 1996 and the fourth quarter of 1995, and d) a $5.0 million increase
in the current portion of long term debt. These working capital decreases were
partly offset by a) $1.1 million increase in cash and b)a $5.6 million increase
in receivables, principally due to an
-12-
<PAGE>
PLAYTEX PRODUCTS, INC.
PART I - FINANCIAL INFORMATION
increase in sales in the third quarter of 1996 versus the fourth quarter of
1995. All other working capital components increased by a net $1.5 million.
Long-term debt (including current portion) of $735.8 million at September
28, 1996 was $54.3 million lower than at December 30, 1995. The net decrease in
long-term borrowings reflected the impact of the scheduled $20.0 million
principal payment on the 1995 Term Loan Facility, a $30.0 million reduction in
the 1995 Acquisition Credit Facility and a $4.3 million reduction in the 1995
Working Capital Facility.
The Company believes that it will generate sufficient cash flow from
operations to be able to make the scheduled interest and principal payments
under the 1995 Credit Agreement and interest payments on the 9% Notes; however
the Company does not expect to generate sufficient cash flow from operations to
make the principal payment due in 2003 on the 9% Notes. Accordingly, the Company
will have to either refinance its obligations with respect to the 9% Notes prior
to maturity, sell assets or raise equity capital to repay the principal amount
of the 9% Notes. The Company's ability to make scheduled principal payments, to
refinance its obligations with respect to its indebtedness, sell assets or raise
equity capital depends on its financial and operating performance, which, in
turn, is in part subject to prevailing economic conditions and to financial,
business and other factors beyond its control. Although the Company's cash flow
from its operations and borrowings have been sufficient to meet its historical
debt service obligations, there can be no assurance that the Company's operating
results will continue to be sufficient or that future borrowing facilities will
be available for the payment or refinancing of the Company's indebtedness.
Capital Expenditures for equipment and facility improvements were $6.9
million and $10.9 million for the nine month periods ended September 28, 1996
and September 30, 1995, respectively.
Inflation in the United States and Canada has not been a significant
concern of the Company during recent periods.
The Company's businesses, with the exception of Banana Boat, have generally
-----------
not been seasonal. Banana Boat sales are highly seasonal with 85 to 90 percent
-----------
of sales occurring in the first six months of the year. In addition, the
seasonality requires increased working capital needs to support inventory builds
prior to the selling season and higher receivable levels resulting from extended
credit terms which are typical in the sun care industry.
-13-
<PAGE>
PLAYTEX PRODUCTS, INC.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
The following should be read in conjunction with Part 1, Item 3., "Legal
Proceedings" in the Registrant's Annual Report on Form 10-K for the year ended
December 30, 1995.
As of the end of September 1996, there were approximately 7 pending Toxic
Shock Syndrome ("TSS") claims relating to Playtex tampons, although additional
claims may be made in the future.
In the previously reported action, "Harding, Hayes et. al. v. Tambrands,
Inc. and Playtex Family Products Corp.", in which plaintiffs purported to
represent and sought to certify a nationwide class of tampon users who allegedly
contracted TSS from the use of rayon fiber tampons manufactured by Playtex, the
Court denied class certification in March, 1996. The plaintiff's time to appeal
this ruling has not expired.
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits
(27) Financial Data Schedule
b. Reports on Form 8-K - None
-14-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PLAYTEX PRODUCTS, INC.
Date: November 12, 1996 By: /s/Michael R. Gallagher
--------------------------- ---------------------------------
Michael R. Gallagher
Chief Executive Officer
Date: November 12, 1996 By: /s/Michael F. Goss
--------------------------- ---------------------------------
Michael F. Goss
Executive Vice President
and
Chief Financial Officer
-15-
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-28-1996
<PERIOD-END> SEP-28-1996
<CASH> 7,059
<SECURITIES> 0
<RECEIVABLES> 65,194
<ALLOWANCES> 1,569
<INVENTORY> 33,541
<CURRENT-ASSETS> 118,800
<PP&E> 119,334
<DEPRECIATION> 66,501
<TOTAL-ASSETS> 659,684
<CURRENT-LIABILITIES> 118,660
<BONDS> 710,750
0
0
<COMMON> 509
<OTHER-SE> (284,572)
<TOTAL-LIABILITY-AND-EQUITY> 659,684
<SALES> 392,439
<TOTAL-REVENUES> 392,439
<CGS> 149,745
<TOTAL-COSTS> 149,745
<OTHER-EXPENSES> 161,784
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 49,110
<INCOME-PRETAX> 31,800
<INCOME-TAX> 14,922
<INCOME-CONTINUING> 16,878
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 16,878
<EPS-PRIMARY> .33
<EPS-DILUTED> .33
</TABLE>
