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 Quarterly Period Ended October 2, 1994
or
( ) Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from _________________________
to _________________________
Commission File Number 0-17873
GIDDINGS & LEWIS, INC.
(Exact name of registrant as specified in its charter)
Wisconsin 39-1643189
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
142 Doty Street, Fond du Lac, Wisconsin 54935
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (414) 921-9400
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.
Common Stock Outstanding as of October 2, 1994: 34,300,925 shares
<PAGE>
GIDDINGS & LEWIS, INC.
Form 10-Q Index
For Quarter Ended October 2, 1994
Page
PART I. Financial Information
Item 1. Condensed Consolidated Statements of Income 3
Condensed Consolidated Statements of Cash Flows 4
Condensed Consolidated Balance Sheets 5
Condensed Consolidated Statement of Changes
in Shareholders' Equity 6
Notes to Condensed Consolidated Financial
Statements 7 - 9
Item 2. Management's Discussion and Analysis of
Results of Operations and Financial
Condition 10 - 12
PART II. Other Information
Item 6. Exhibits and Reports on Form 8-K 13
Signatures 14
<PAGE>
GIDDINGS & LEWIS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In Thousands Except Share and Per Share Data)
(Unaudited)
Three months ended Nine months ended
Oct. 2, Oct. 3, Oct. 2, Oct. 3,
1994 1993 1994 1993
[S] [C] [C] [C] [C]
Net sales $ 166,100 $ 122,003 $ 433,935 $ 398,085
Costs and expenses:
Cost of sales 131,476 87,212 340,185 279,875
Selling, general and
administrative
expenses 15,526 14,489 43,522 50,897
Depreciation and
amortization 3,870 3,494 12,054 11,136
--------- --------- --------- ---------
Total operating expenses 150,872 105,195 395,761 341,908
--------- --------- --------- ---------
Operating income 15,228 16,808 38,174 56,177
Interest (income)/expense (138) 148 (757) 2,820
Other (income)/expense (468) 644 (404) 1,566
--------- --------- -------- --------
Income before provision
for income taxes 15,834 16,016 39,335 51,791
Provision for income taxes 6,025 4,928 15,426 18,987
--------- --------- --------- ---------
Net income $ 9,809 $ 11,088 $ 23,909 $ 32,804
========= ========= ========= =========
Per common share amounts:
Net income available to
common shareholders $ .29 $ .33 $ .70 $ .99
========= ========= ========= =========
Dividends declared $ .03 $ .03 $ .09 $ .09
========= ========= ========= =========
Average number of common
shares outstanding 34,290,599 34,098,741 34,280,033 33,152,185
See accompanying notes.
<PAGE>
<TABLE>
GIDDINGS & LEWIS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)
<CAPTION>
Three months ended Nine months ended
Oct. 2, Oct. 3, Oct. 2, Oct. 3,
1994 1993 1994 1993
<S> <C> <C> <C> <C>
Operating activities:
Net income $ 9,809 $ 11,088 $ 23,909 $ 32,804
Adjustments to reconcile net income to
net cash provided (used) by operating
activities:
Depreciation and amortization 3,870 3,494 12,054 11,136
Deferred income taxes - 1,997 - 12,261
Net changes in working capital items (48,894) (25,726) (44,472) 5,939
Other 514 892 (2,035) 450
------- ------- ------- --------
Net cash provided (used) by operating
activities (34,701) (8,255) (10,544) 62,590
------- ------- ------- --------
Investing activities:
Additions to property, plant,
and equipment (3,871) (3,029) (12,445) (14,796)
Other 97 4,288 3,587 7,627
-------- ------- ------- --------
Net cash provided (used) by
investing activities (3,774) 1,259 (8,858) (7,169)
-------- ------- ------- --------
Financing activities:
Net decrease in notes payable - - - (18,351)
Payment of long-term borrowings - - - (11,000)
Payments on debenture redemptions
and conversions - - - (224)
Proceeds from restricted stock
transactions - 2 - 11
Proceeds from stock option
transactions 32 1,735 488 1,849
Cash dividends (1,030) (1,022) (3,087) (3,044)
-------- ------- -------- -------
Net cash provided (used) by
financing activities (998) 715 (2,599) (30,759)
-------- ------- -------- -------
Effect of exchange rate changes on cash 1,316 (105) 3,546 (512)
-------- ------- -------- -------
Net increase (decrease) in cash and
cash equivalents (38,157) (6,386) (18,455) 24,150
Cash and cash equivalents - beginning
of period 73,579 39,037 53,877 8,501
-------- -------- --------- --------
Cash and cash equivalents - end of period $ 35,422 $ 32,651 $ 35,422 $ 32,651
======== ========= ========= ========
</TABLE>
See accompanying notes.
<PAGE>
GIDDINGS & LEWIS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
October 2, December 31,
1994 1993
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 35,422 $ 53,877
Accounts receivable 298,508 246,130
Inventories (Note 2) 65,901 57,393
Deferred income taxes 23,770 23,770
Other current assets 7,349 6,304
------- -------
Total current assets 430,950 387,474
Fixed assets - net 106,498 101,269
Costs in excess of net acquired assets 89,575 91,386
Other assets 8,727 12,897
Deferred income taxes 20,990 20,990
------- -------
TOTAL ASSETS $656,740 $614,016
======= =======
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 62,204 $ 31,059
Accrued expenses and other
liabilities 85,117 98,337
------- -------
Total current liabilities 147,321 129,396
Long-term employee benefits and
other long-term liabilities 46,153 48,610
------- -------
Total liabilities 193,474 178,006
Contingencies (Note 3)
Shareholders' equity:
Class A preferred stock - -
Common stock 3,431 3,425
Capital in excess of par 325,421 323,679
Retained earnings 135,351 114,692
Cumulative translation adjustment 1,140 (3,444)
Unamortized compensation expense (2,077) (2,342)
-------- --------
Total shareholders' equity 463,266 436,010
-------- --------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $656,740 $614,016
======== ========
See accompanying notes.
<PAGE>
<TABLE>
GIDDINGS & LEWIS, INC.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
NINE MONTHS ENDED OCTOBER 2, 1994
(In Thousands, Except Share Amounts)
(Unaudited)
<CAPTION>
Capital in Cumulative Unamortized Total
Common Stock Excess of Retained Translation Compensation Shareholders'
Shares Amount Par Earnings Adjustment Expense Equity
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1993 34,254,068 $ 3,425 $ 323,679 $114,692 $ (3,444) $ (2,342) $ 436,010
Issuance of shares under
restricted stock awards 58,840 6 1,180 (1,186) 0
Cancellation of shares under
restricted stock awards (29,332) (3) (349) 159 (193)
Issuance of shares for options
exercised under stock
option plan 48,788 6 482 488
Tax benefit related to
options exercised 772 772
Net income 23,909 23,909
Amortization of compensation
expense 1,292 1,292
Cash dividends (3,087) (3,087)
Translation adjustment 4,584 4,584
Retirement of Treasury Shares (31,439) (3) (343) (163) (509)
--------- ------ -------- ------- ------- ------- ---------
Balance, October 2, 1994 34,300,925 $ 3,431 $ 325,421 $135,351 $ 1,140 $(2,077) $ 463,266
========== ======= ========= ======== ======= ======= =========
</TABLE>
See accompanying notes.
<PAGE>
GIDDINGS & LEWIS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
OCTOBER 2, 1994
(Unaudited)
1. Basis of Presentation
The accompanying unaudited condensed consolidated financial statements
have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions
to Form 10-Q and Article 10 of Regulation S-X. 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 three and nine month periods
ended October 2, 1994 are not necessarily indicative of the results
that may be expected for the year ending December 31, 1994. 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 December 31, 1993.
The Company is organized into four major operating groups: Automation
Technology, Integrated Automation, Automation Measurement and Control,
and European Operations. The Automation Technology Group is
responsible for the manufacture of cellular and smart manufacturing
systems, automated standalone machine tools, tooling and fixtures,
gray iron castings and remanufacturing. The Integrated Automation
Group produces assembly automation products and systems and flexible
transfer lines. Programmable industrial computers, servo systems, CNC
controls, and measurement products are offered by the Automation
Measurement and Control Group. The European Operations Group offers
the Company's complete product lines through its sales, engineering,
manufacturing, and service facilities in England and Germany.
2. Inventories
October 2, December 31,
1994 1993
(in thousands)
Raw materials $ 30,094 $ 29,613
Work-in-process 25,735 16,594
Finished goods 10,072 11,186
---------- ----------
$ 65,901 $ 57,393
========== ==========
3. Contingencies
The Company is involved in various environmental matters, including
matters in which the Company and certain of its subsidiaries have
either been named as potentially responsible parties under the
Comprehensive Environmental Response Compensation and Liability Act
("CERCLA") or are involved with state environmental authorities. The
sites involved include facilities acquired by the Company in
connection with the acquisition of Cross & Trecker Corporation in
October 1991, including a soil and water contamination matter at the
Company's former West Allis, Wisconsin facility. In May, 1994, the
Company sold a portion of the West Allis site containing the
manufacturing facility along with the associated environmental
remediation responsibilities for that portion of the site. The
Company has developed and submitted plans to the Wisconsin Department
of Natural Resources which will lead to the remediation of the
remainder of the West Allis site which has been retained by the
Company.
The Company has established accruals for all environmental
contingencies of which management is currently aware in accordance
with generally accepted accounting principles. In establishing these
accruals, management considered (a) reports of environmental
consultants retained by the Company, (b) the costs incurred to date by
the Company at sites where clean-up is presently ongoing and the
estimated costs to complete the necessary remediation work remaining
at such sites, (c) the financial solvency, where appropriate, of other
parties that have been identified as responsible for effecting
remediation at specified sites, and (d) the experience of other
parties who have been involved in the remediation of comparable sites.
The accruals recorded by the Company with respect to environmental
matters have not been reduced by potential insurance recoveries or
other recoveries and are not discounted. Although the Company has and
will continue to pursue such claims against insurance carriers and
other responsible parties, future potential recoveries remain
uncertain and, therefore, were not recorded as a reduction to the
estimated gross environmental liabilities. Based on the foregoing and
given current information, management believes that future costs in
excess of the amounts accrued on all presently known and quantifiable
environmental contingencies will not be material to the Company's
financial position or results of operations.
In addition, the Michigan Department of Natural Resources is
investigating alleged environmental violations at the Company's
Menominee, Michigan facility. The investigation focuses on air
emissions, and their potential impact on surrounding soil and waste
disposal practices. Two related civil lawsuits have also been filed
regarding this matter. Information presently available to the Company
does not enable it to reasonably estimate potential civil or criminal
penalties, or remediation costs, if any, related to the Menominee
matter.
The Company is also involved in other litigation and proceedings,
including product liability claims. In the case of product liability,
the Company is partially self-insured and has accrued for all claim
exposure for which a loss is probable and reasonably estimable. The
Company does not believe that the outcome of such litigation will have
a material adverse effect upon the Company.
As part of the acquisition of Cross & Trecker Corporation, the Company
acquired two contracts with customers located in the former Soviet
Union (Russian contracts). These contracts, totalling approximately
$48.2 million, were entered into by Cross & Trecker Corporation prior
to the acquisition. In light of the political and economic
instability in the former Soviet Union, the Company was unable to
predict when or if effective guarantees (see below) would be obtained
or additional payments would be received under these contracts.
Accordingly, at the time of the acquisition, the Company wrote off the
uncollected receivables and reserved for the costs committed to be
incurred with respect to these contracts.
In August, 1992, Export-Import Bank of the United States issued a
conditional guarantee for one of the Russian contracts. At October
2, 1994, all of the specified procedures needed to activate this
guarantee had not yet been satisfied. However, in November, 1993, the
Company received the remaining contractual downpayment relating to
this contract. Because the related receivable had previously been
written off, the downpayment was recorded as income in 1993. For the
other Russian contract, no payments have been received and no credit
guarantee has been issued. The Company continues to pursue collection
of the remaining amounts outstanding under these contracts.
<PAGE>
GIDDINGS & LEWIS, INC.
Management's Discussion and Analysis of Results of Operations
and Financial Condition
Results of Operations for the First Nine Months
of 1994 Compared to 1993
The following table sets forth the Company's bookings by operating group
in the period and consolidated backlog at period-end on a quarterly basis
for the period January 1, 1993 through October 2, 1994.
<TABLE>
<CAPTION>
April 4, July 4, Oct. 3, Dec. 31, April 3, July 3, Oct. 2,
1993 1993 1993 1993 1994 1994 1994
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
Operating group:
Automation
Technology $ 36,987 $ 31,716 $ 36,561 $ 39,857 $ 32,034 $ 31,724 $ 28,973
Integrated
Automation 26,612 59,723 39,837 79,270 117,610 113,870 94,705
European
Operations 52,367 28,543 55,404 8,433 6,138 5,771 12,141
Automation
Measurement
and Control 13,328 11,954 13,818 14,511 13,647 17,831 16,964
------- ------- -------- ------- -------- -------- --------
Consolidated
Bookings $129,294 $131,936 $145,620 $142,071 $169,429 $169,196 $152,783
======= ======= ======= ======= ====== ======= ========
Consolidated
Backlog $349,070 $342,605 $367,857 $382,694 $431,448 $460,370 $449,969
======= ======= ======== ========= ======== ======== ========
</TABLE>
Bookings in the first nine months of 1994 were $491.4 million compared to
bookings in the first nine months of 1993 of $406.9 million, an increase
of 20.8%. Automation Technology bookings of $92.7 million in the first
nine months of 1994 decreased 11.9% from the comparable 1993 period. The
decrease reflects continued weakness in the demand for large machine tools
and flexible manufacturing systems. Integrated Automation bookings in the
first nine months totalled $326.2 million, a 158.5% increase from the year
earlier period total of $126.2 million. The increase in bookings is
attributable to significant order placement by the domestic automotive
industry during the first nine months of 1994. The Company believes that
order placement by the domestic automotive sector will remain above
historic average levels throughout 1994. European Operations bookings
decreased from $136.3 million in the first nine months of 1993 to $24.1
million in the first nine months of 1994. Bookings in the first nine
months of 1993 were favorably impacted by significant orders received from
European automotive companies and a Korean automotive company. The
decrease in 1994 was due to unfavorable economic conditions and increased
competitive pressures in the Company's European markets. There appears to
be no indication of near term improvement in the outlook for bookings in
Europe. If no such improvement is experienced, sales and earnings from
the European Operations Group will be adversely affected. Automation
Measurement and Control bookings of $48.4 million for the first nine
months of 1994 increased 23.9% over the comparable 1993 period bookings of
$39.1 million due mainly to large orders received from the automotive and
mining industries.
Bookings in the third quarter of 1994 were $152.8 million compared to
bookings in the third quarter of 1993 of $145.6 million, an increase of
4.9%. Automation Technology bookings were $29.0 million in the third
quarter of 1994 compared to $36.6 million in the third quarter of 1993, a
decrease of 20.8%. Integrated Automation bookings of $94.7 million in the
third quarter of 1994 increased 137.7% from $39.8 million in the third
quarter of 1993. European Operations bookings decreased 78.1% from $55.4
million in the third quarter of 1993 to $12.1 million in the third quarter
of 1994. Automation Measurement and Control bookings of $17.0 million for
the third quarter of 1994 increased 22.8% from $13.8 million in the third
quarter of 1993. The reasons for the fluctuations in third quarter
bookings (1994 vs. 1993) are essentially the same as those noted in the
previous paragraph which discussed nine-month results.
Consolidated net sales in the first nine months of 1994 totalled $433.9
million compared to $398.1 million in the year earlier period. Net sales
for Automation Technology in the first nine months of 1994 were $125.8
million, a decrease of 4.6% from the year earlier period total of $131.9
million. Integrated Automation net sales increased 18.7% from $149.0
million in the first nine months of 1993 to $176.9 million in the
comparable 1994 period. The increase in Integrated Automation sales is
the result of improvements in bookings starting in the fourth quarter of
1993 and continuing into 1994. European Operations sales in the first
nine months of 1994 were $85.8 million, an increase of 15.5% from $74.3
million in the year earlier period. The increase in net sales relates
mainly to significant orders received by the European Operations group in
the third quarter of 1993. As discussed above, European Operations sales
are expected to decline absent near term improvement in bookings.
Automation Measurement and Control net sales increased 5.9% to $45.5
million in the 1994 period compared to $43.0 million in the 1993 period.
Consolidated net sales increased from $122.0 million in the third quarter
of 1993 to $166.1 million in the third quarter of 1994. In the third
quarter of 1994, Automation Technology net sales totalled $41.0 million
compared to $40.8 million in the year earlier period. Integrated
Automation net sales of $75.0 million in the third quarter of 1994
increased from $40.8 million in the comparable 1993 period. European
Operations net sales in the third quarter of 1994 were $34.4 million, a
33.8% increase from 1993 third quarter net sales of $25.7 million. Net
sales for the Automation Measurement and Control group were $15.8 million
in the third quarter of 1994 compared to $14.7 million in the year earlier
period. The reasons for the fluctuations in third quarter sales (1994 vs.
1993) are essentially the same as those noted in the previous paragraph
which covered nine-months results.
The consolidated gross margin percentage (before depreciation and
amortization) for the first nine months and the third quarter of 1994 was
21.6% and 20.8%, respectively, as compared to 29.7% and 28.5% for the
comparable 1993 periods. Gross margins for the first nine months and
third quarter of 1994 were adversely impacted by competitive pricing
pressures, cost overruns on contracts booked in prior periods, and
increased product development spending. The Company currently does not
expect the gross margin percentage for the fourth quarter of 1994 to
differ significantly from the actual gross margin percentage for the nine
months ended October 2, 1994.
Selling, general, and administrative expenses (before depreciation and
amortization) decreased as a percentage of sales to 10.0% in the first
nine months of 1994 from 12.8% in the year earlier period, and to 9.3% for
the third quarter of 1994 from 11.9% in the third quarter of 1993. The
percentage decrease is primarily attributable to cost reduction measures,
improved engineering efficiencies and a change in the mix of sales towards
lower commission sales.
Net interest (income)/expense for the first nine months and third quarter
of 1994 of ($.8) million and ($.1) million, respectively, decreased from
$2.8 million and $.1 million, respectively, in the comparable 1993
periods. The decrease in net interest expense is attributable to (1) the
redemption or conversion into common stock in March, 1993 of all of the
Company's 10% convertible subordinated debentures, (2) the repayment of
all remaining outstanding debt in the third quarter of 1993, and (3) the
increase in cash and cash equivalents (cash and cash equivalents increased
from $8.5 million at December 31, 1992 to $35.4 million at October 2,
1994).
The provision for income taxes of $15.4 million and $6.0 million,
respectively, for the first nine months and third quarter of 1994 is based
on the estimated annual effective tax rate for 1994. The Company's
effective tax rate for the first nine months and third quarter of 1994
amounted to 39.2% and 38.1% respectively, as compared to 36.7% and 30.8%
for the year earlier periods.
Liquidity and Capital Resources at October 2, 1994
On October 2, 1994, the Company had $35.4 million of cash and cash
equivalents on hand, which is a decrease of $18.5 million from the balance
on hand at the beginning of the year. For the first nine months of 1994,
operating activities used $10.5 million of cash. Net working capital
items increased by $44.5 million due primarily to higher accounts
receivable and inventory balances and a decrease in accrued expenses and
other liabilities. The higher receivable balance resulted from progress
on significant contracts. The decrease in accrued expenses and other
liabilities resulted mainly from the payment of year-end accruals.
Offsetting the changes in the above working capital items was an increase
in accounts payables which reflects elevated purchasing activity required
to support significant contracts in progress. In the third quarter of
1994, net working capital items increased by $48.9 million due mainly to
higher accounts receivable. In the third quarter, significant progress
was made by the Integrated Automation and European Operations groups on
contracts accounted for under the percentage of completion method of
accounting. Investing activities used $8.9 million during the first nine
months of 1994, which included capital expenditures totalling $12.4
million and proceeds from the sale of assets held for sale of $4.0
million. During the same period, financing activities used cash of $2.6
million including dividend payments of $3.1 million.
The Company believes its cash flows from operations and funds available
under domestic and foreign credit agreements will be adequate to finance
capital expenditures and working capital requirements for the foreseeable
future.
<PAGE>
Part II - OTHER INFORMATION
Giddings & Lewis, Inc.
Form 10-Q
October 2, 1994
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27 Financial Data Schedule
(b) Reports on Form 8-K
The Company filed no reports on Form 8-K during the
quarter ended October 2, 1994.
<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.
Giddings & Lewis, Inc.
Date: November 15, 1994 /s/Joseph R. Coppola
Joseph R. Coppola
Chairman and Chief Executive
Officer
Date: November 15, 1994 /s/Richard C. Kleinfeldt
Richard C. Kleinfeldt
Vice-President - Finance and
Secretary (Chief Financial and
Accounting Officer)
<PAGE>
EXHIBIT INDEX
GIDDINGS & LEWIS, INC.
Exhibit No. Exhibit Description
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS CONTAINED IN THE FORM 10-Q FILED BY GIDDINGS & LEWIS,
INC. FOR THE QUARTER ENDED OCTOBER 2, 1994 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-31-1994
<PERIOD-START> JAN-01-1994
<PERIOD-END> OCT-02-1994
<CASH> 35,422
<SECURITIES> 0
<RECEIVABLES> 300,684
<ALLOWANCES> 2,176
<INVENTORY> 65,901
<CURRENT-ASSETS> 430,950
<PP&E> 210,970
<DEPRECIATION> 104,472
<TOTAL-ASSETS> 656,740
<CURRENT-LIABILITIES> 147,321
<BONDS> 0
<COMMON> 3,431
0
0
<OTHER-SE> 459,835
<TOTAL-LIABILITY-AND-EQUITY> 656,740
<SALES> 433,935
<TOTAL-REVENUES> 433,935
<CGS> 340,185
<TOTAL-COSTS> 340,185<F1>
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (757)
<INCOME-PRETAX> 39,335
<INCOME-TAX> 15,426
<INCOME-CONTINUING> 23,909
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 23,909
<EPS-PRIMARY> .70
<EPS-DILUTED> .70
<FN>
<F1> Consists of cost of sales only. Does not reflect either selling, general
and administrative expenses or depreciation and amortization.
</FN>
</TABLE>
