UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1997
Commission File Number 0-22572
OM GROUP, INC.
(exact name of registrant as specified in its charter)
Delaware 52-1736882
(state or other jurisdiction of (I.R.S., Employer
incorporation or organization) Identification Number)
Tower City
3800 Terminal Tower
Cleveland, Ohio 44113-2204
(Address of principal executive offices)
(zip code)
(216) 781-0083
(Registrant's telephone number, including area code)
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 and 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 September 30, 1997: Common Stock, $.01 Par Value -
22,086,903 shares.
<PAGE>
INDEX
OM GROUP, INC.
Part I. Financial Information
Item 1. Financial Statements
Condensed consolidated balance sheets -- September 30, 1997 and
December 31, 1996
Condensed consolidated statements of income - Three months ended
September 30, 1997 and 1996; Nine months ended September 30, 1997
and 1996
Condensed consolidated statements of cash flows - Nine months ended
September 30, 1997 and 1996
Notes to condensed consolidated financial statements - September
30, 1997
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
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
Item 5. Other information - Not applicable
Item 6. Exhibits and Reports on Form 8-K
(11) Statement regarding computation of earnings per share
(15) Independent Accountants' Review Report
(15) Letter re: Unaudited Interim Financial Information
(27) Financial Data Schedule
-1-
<PAGE>
Part I Financial Information
Item 1 Financial Statements
OM GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Thousands of dollars)
(Unaudited)
September 30, December 31,
1997 1996
--------- ---------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 6,766 $ 7,818
Accounts receivable 82,825 60,054
Inventories 228,864 195,050
Other current assets 7,499 8,245
-------- --------
Total Current Assets 325,954 271,167
PROPERTY, PLANT AND EQUIPMENT
Land 2,872 467
Buildings and improvements 47,619 40,569
Machinery and equipment 156,352 122,695
Furniture and fixtures 6,649 4,074
-------- --------
213,492 167,805
Less accumulated depreciation 69,752 57,184
-------- --------
143,740 110,621
OTHER ASSETS
Unprocessed inventory 27,499
Goodwill and other intangible assets 116,803 23,036
Other assets 9,135 6,310
-------- --------
TOTAL ASSETS $595,632 $438,633
======== ========
-2-
<PAGE>
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current portion of long-term debt $ 148 $ 3,586
Accounts payable 65,193 77,330
Other accrued expenses 19,155 16,390
-------- --------
Total Current Liabilities 84,496 97,306
LONG-TERM LIABILITIES
Long-term debt 184,215 109,295
Contract payable 27,499
Deferred income taxes 25,777 17,773
Other long-term liabilities 7,163 1,438
STOCKHOLDERS' EQUITY
Preferred stock, $0.01 par value:
Authorized 2,000,000 shares; no shares issued
or outstanding
Common stock, $0.01 par value:
Authorized 30,000,000 shares;
issued 22,209,375 shares at September 30, 1997
and 18,759,346 shares at December 31, 1996 222 188
Capital in excess of par value 189,322 102,125
Retained earnings 109,331 86,345
Treasury stock (122,472 shares at September 30,
1997 and 141,432 shares at December 31,
1996, at cost) (4,341) (3,095)
Foreign currency translation adjustments (553) (241)
-------- --------
Total Stockholders' Equity 293,981 185,322
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $595,632 $438,633
======== ========
See notes to condensed Consolidated Financial Statements
-3-
<PAGE>
Part I Financial Information
Item 1 Financial Statements
OM GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Thousands of dollars, except per share data)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------- ---------------------
1997 1996 1997 1996
-------- -------- -------- ---------
OPERATIONS
Net sales $126,317 $ 89,071 $360,706 $293,409
Cost of products sold 96,368 68,166 274,696 231,263
------- ------- ------- -------
29,949 20,905 86,010 62,146
Selling, general and
administrative expenses 11,629 7,869 34,125 23,768
------- ------- ------- -------
INCOME FROM OPERATIONS 18,320 13,036 51,885 38,378
OTHER INCOME (EXPENSE)
Interest expense (3,132) (1,776) (10,286) (5,530)
Interest income 21 86 83 217
Foreign exchange gain (loss) 210 (45) 560 167
------- ------- ------- -------
(2,901) (1,735) (9,643) (5,146)
------- ------- ------- -------
INCOME BEFORE INCOME TAXES 15,419 11,301 42,242 33,232
Income taxes 5,204 3,631 14,232 10,828
------- ------- ------- -------
NET INCOME $10,215 $ 7,670 $28,010 $22,404
======= ======= ======= =======
Net income per share $0.45 $0.40 $1.32 $1.16
Dividends paid per common share $0.08 $0.07 $0.24 $0.21
Weighted average shares (000) 22,844 19,252 21,272 19,258
See notes to condensed Consolidated Financial Statements
-4-
<PAGE>
Part I Financial Information
Item 1 Financial Statements
OM GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Thousands of dollars)
(Unaudited)
Nine Months Ended
September 30,
-------------------
1997 1996
-------- --------
OPERATING ACTIVITIES
Net income $28,010 $22,404
Items not affecting cash:
Depreciation and amortization 14,855 12,537
Foreign exchange gain (560) (167)
Deferred income taxes 1,561 3,263
Changes in operating assets and liabilities (48,895) (24,120)
------- -------
NET CASH (USED IN) PROVIDED BY OPERATING
ACTIVITIES (5,029) 13,917
INVESTING ACTIVITIES
Expenditures for property, plant and equipment, net (24,036) (17,662)
Acquisition of business (124,547) (150)
------- -------
NET CASH USED IN INVESTING ACTIVITIES (148,583) (17,812)
FINANCING ACTIVITIES
Dividend payments (5,024) (4,100)
Long-term borrowings 172,250 19,318
Payments of long-term debt (100,462) (14,427)
Purchase of treasury stock (1,246) (608)
Issuance of common stock 87,231
------- -------
NET CASH PROVIDED BY FINANCING ACTIVITIES 152,749 183
Effect of exchange rate changes on cash and cash
equivalents (189) (123)
------- -------
Decrease in cash and cash equivalents (1,052) (3,835)
Cash and cash equivalents at beginning of period 7,818 9,098
------- -------
Cash and cash equivalents at end of period $ 6,766 $ 5,263
======= =======
See notes to condensed Consolidated Financial Statements
-5-
<PAGE>
Part I Financial Information
Item 1 Financial Statements
OM GROUP, INC.
Notes to Condensed Consolidated Financial Statements (Unaudited)
September 30, 1997
Note A 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. 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 financial
presentation have been included. Past operating results are not
necessarily indicative of the results which may occur in future
periods. For further information refer to the consolidated
financial statements and notes thereto included in the Company's
Annual Report on Form 10-K for the year ended December 31, 1996.
In February, 1997, Statement of Financial Accounting Standards
(SFAS) No. 128, "Earnings Per Share" was issued. SFAS No. 128
establishes standards for computing and presenting earnings per
share. The Company must adopt SFAS No. 128 for the year ending
December 31, 1997 and believes the effect of adoption will not be
material.
Note B Inventories
Inventories consist of the following (in thousands):
September 30, December 31,
1997 1996
------------- ------------
Raw materials and supplies $129,034 $116,389
Finished goods 101,841 87,980
--------- ---------
230,875 204,369
LIFO reserve (2,011) (9,319)
--------- ---------
Total inventories $228,864 $195,050
========= =========
-6-
<PAGE>
Part I Financial Information
Item 1 Financial Statements
Note C Contingent Matters
The Company is a party to various legal proceedings incidental to
its business and is subject to a variety of environmental and
pollution control laws and regulations in the jurisdictions in which
it operates. As is the case with other companies in similar
industries, the Company faces exposure from actual or potential
claims and legal proceedings involving environmental matters.
Although it is very difficult to quantify the potential impact of
compliance with or liability under environmental protection laws,
management believes that the ultimate aggregate cost to the Company
of environmental remediation, as well as other legal proceedings
arising out of operations in the normal course of business, will not
result in a material adverse effect upon its financial condition or
results of operations.
Note D Acquisition, Sale of Common Stock, and Supplemental Earnings Per
Share
On January 21, 1997, the Company acquired SCM Metal Products, Inc.
(SCM) for a purchase price of $122 million. The acquisition of SCM,
which had fiscal 1996 sales of approximately $94 million, has been
recorded using the purchase method of accounting. Accordingly, the
Company's results of operations reflect the impact of SCM from the
date of acquisition.
The acquisition was financed through bank borrowings. In April,
1997, the Company sold 3,450,000 shares of common stock in a public
offering; the net proceeds of $87.2 million were used to pay down a
portion of the debt incurred in acquiring SCM. Had these shares
been issued at the date of acquisition, net income per share for the
nine months ended September 30, 1997 would have been $1.29 per
share.
Pro forma net sales, net income and net income per share as if the
acquisition had occurred as of January 1, 1997, would not be
materially different from that reported in the Condensed
Consolidated Statements of Income for the three and nine months
ended September 30, 1997. Had the acquisition occurred as of
January 1, 1996, pro forma net sales, net income and net income per
share for the three and nine months ended September 30, 1996 would
have been as follows (in thousands, except per share data).
-7-
<PAGE>
Part I Financial Information
Item 1 Financial Statements
Three Months Ended Nine Months Ended
September 30, 1996 September 30, 1996
------------------ ------------------
Net Sales $110,959 $364,131
Net Income $7,055 $21,790
Net Income Per Share $.37 $1.13
The aforementioned pro forma information includes the amortization
of goodwill associated with the acquisition over 40 years by the
straight-line method and an interest cost on the funds borrowed to
finance the acquisition.
Item 2 Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations
Three Months Ended September 30, 1997 Compared to Three Months Ended
September 30, 1996
Net sales for the three months ended September 30, 1997 were $126.3
million, an increase of 41.8% compared to the same period for 1996.
The increase in sales resulted principally from an increase in
physical volume of products sold and the January, 1997 acquisition
of SCM.
Cobalt market prices ranged from $22 to $23 per pound during the
three month period ended September 30, 1997 compared to a range of
$20 to $24 per pound during the same period in 1996. The market
price of nickel ranged from $2.89 to $3.09 per pound during the
three months ended September 30, 1997 compared to $3.13 to $3.45 per
pound during the same period in 1996.
Pounds of product sold by the Company were approximately 39.6
million pounds in the three month period ended September 30, 1997
compared to 24.2 million pounds in the same period in 1996. The
following table sets forth the pounds of carboxylates, salts and
powders sold during each period:
Three Months Ended September 30, Percentage
(in millions of pounds) 1997 1996 Change
---- ---- ------
Carboxylates 13.4 11.3 18.6%
Salts 15.9 12.3 29.3%
Powders 10.3 0.6 1616.7%
---- ---- -------
39.6 24.2 63.6%
==== ==== =======
-8-
<PAGE>
Part I Financial Information
Item 2 Management's Discussion and Analysis of Financial Condition and
Results of Operations
The increase in carboxylate products sold resulted principally from
higher sales in all market regions. The increase in physical volume
of salt and powder products sold primarily reflects the addition of
copper salt and powder products sold, as a result of the SCM
acquisition, as well as increases in fine cobalt powders and cobalt
salt products.
Gross profit increased to $29.9 million for the three month period
ended September 30, 1997, a 43.3% increase over the same period in
1996. The improvement in gross profit was primarily the result of
the acquisition of SCM and higher physical volume of products sold.
Cost of products sold remained approximately the same at 76.3% of
net sales for the three months ended September 30, 1997 compared to
76.5% of net sales during the same period of 1996.
Selling, general and administrative expenses increased to 9.2% of
net sales for the third quarter of 1997, from 8.8% of net sales for
the same period in 1996, primarily as a result of the acquisition of
SCM.
Other expense in 1997 was $2.9 million compared to $1.7 million in
1996, due primarily to increased interest expense on higher
outstanding borrowings.
Income taxes as a percentage of income before tax increased to 33.8%
for the third quarter of 1997, from 32.1% in the same period in
1996, due primarily to the non-tax deductible goodwill incurred in
the acquisition of SCM.
Net income for the three month period ended September 30, 1997 was
$10.2 million, an increase of $2.5 million from the same period in
1996, due to the aforementioned factors.
Nine Months Ended September 30, 1997 Compared to Nine Months Ended
September 30, 1996
Net sales for the nine months ended September 30, 1997 were $360.7
million, an increase of 22.9% compared to the same period for 1996.
The increase in sales resulted principally from an increase in
physical volume of products sold and the January, 1997 acquisition
of SCM, which offset a decline in the Company's product prices
resulting from lower cobalt market prices.
Cobalt market prices ranged from $19 to $25 per pound during the
nine month period ended September 30, 1997 compared to a range of
$20 to $32 per pound during the same period in 1996. The market
-9-
<PAGE>
Part I Financial Information
Item 2 Management's Discussion and Analysis of Financial Condition and
Results of Operations
price of nickel ranged from $2.88 to $3.66 per pound during the nine
months ended September 30, 1997 compared to $3.13 to $3.78 per pound
during the same period in 1996.
Pounds of product sold by the Company were approximately 112.2
million pounds in the nine month period ended September 30, 1997
compared to 72.0 million pounds in the same period in 1996. The
following table sets forth the pounds of carboxylates, salts and
powders sold during each period:
Nine Months Ended September 30, Percentage
(in millions of pounds) 1997 1996 Change
---- ---- -------
Carboxylates 38.1 32.3 18.0%
Salts 46.0 37.6 22.3%
Powders 28.1 2.1 1,238.1%
----- ---- --------
112.2 72.0 55.8%
===== ==== ========
The increase in physical volume of carboxylate products sold
resulted principally from increased sales in all market regions.
The increase in physical volume of salt and powder products sold
primarily reflects the addition of copper salt and powder products
sold, as a result of the SCM acquisition.
Gross profit increased to $86.0 million for the nine month period
ended September 30, 1997, a 38.4% increase over the same period in
1996. The improvement in gross profit was primarily the result of
the acquisition of SCM, higher physical volume of products sold, and
changes in product mix. Cost of products sold decreased to 76.2% of
net sales for the nine months ended September 30, 1997 compared to
78.8% the same period of 1996, primarily because of lower cobalt
prices.
Selling, general and administrative expenses increased to 9.5% of
net sales for the first nine months of 1997 from 8.1% of net sales
for the same period in 1996, due to a decline in net sales resulting
from lower cobalt prices and the acquisition of SCM.
Other expense in 1997 was $9.6 million compared to $5.1 million in
1996, due primarily to increased interest expense on higher
outstanding borrowings.
-10-
<PAGE>
Part I Financial Information
Item 2 Management's Discussion and Analysis of Financial Condition and
Results of Operations
Income taxes as a percentage of income before tax increased to 33.7%
as compared to 32.6% during the same period in 1996, due primarily
to the non-tax deductible goodwill incurred in the acquisition of
SCM.
Net income for the nine month period ended September 30, 1997 was
$28.0 million, an increase of $5.6 million from the same period in
1996, due to the aforementioned factors.
Liquidity and Capital Resources
During the nine months ended September 30, 1997, the Company's net
working capital increased approximately $67 million. This increase
was primarily the result of a decrease in accounts payable from
payments on certain raw materials and the additional working capital
acquired in the acquisition of SCM. Capital expenditures increased
over the prior year expenditures primarily due to the additional
capital expenditures associated with SCM. These increased cash
needs were funded through cash generated from operations as well as
additional borrowing under the Company's revolving credit facility.
The Company increased its revolving credit facility by $120 million
in January, 1997 to finance the acquisition of SCM Metal Products.
In April, 1997, the Company sold 3,450,000 shares of Common stock at
$26.75 per share in a public offering. The net proceeds of the
offering, in the amount of $87.2 million, were used to pay down debt
incurred in acquiring SCM. After giving effect to the acquisition
and the offering, the Company's current maximum credit, under its
credit facility, is $180 million.
In order to convert to a fixed rate and extend the term on a portion
of its borrowings, the Company borrowed $30 million in a private
placement with a group of insurance companies during October, 1997
and used the proceeds to reduce borrowings under its revolving
credit facility with its banks.
In June, 1997, the Company signed contracts as a partner to build a
smelter in Lubumbashi, Democratic Republic of Congo. The Company's
approximately $40 million share of the $80 million project will be
funded over the two year construction period, commencing in 1997,
through cash generated by operations and the Company's credit
facilities.
-11-
<PAGE>
Part I Financial Information
Item 2 Management's Discussion and Analysis of Financial Condition and
Results of Operations
The Company believes that it will have sufficient cash generated by
operations and through its credit facilities to provide for its
future working capital and capital expenditure requirements and to
pay quarterly dividends on its common stock, subject to the Board's
discretion. Subject to several limitations in its credit
facilities, the Company may incur additional borrowings under this
line to finance working capital and certain capital expenditures,
including, without limitation, the purchase of additional raw
materials.
Forward Looking Statements
The Company is making this statement in order to satisfy the "safe
harbor" provisions contained in the Private Securities Litigation
Reform Act of 1995. The foregoing discussion includes forward-
looking statements relating to the business of the Company.
Forward-looking statements contained herein or in other statements
made by the Company are subject to uncertainties and factors
relating to the Company's operations and business environment, all
of which are difficult to predict and many of which are beyond the
control of the Company, that could cause actual results of the
Company to differ materially from those matters expressed in or
implied by forward-looking statements. The Company believes that
the following factors, among others, could affect its future
performance and cause actual results of the Company to differ
materially from those expressed in or implied by forward-looking
statements made by or on behalf of the Company: (a) the price and
supply of raw materials, particularly cobalt, nickel and copper;
(b) continued growth in demand for the Company's products;
(c) risks associated with environmental liability inherent in the
nature of a chemical business; (d) uncertainty relating to the
Company's ability to identify suitable acquisition candidates and to
finance, consummate and assimilate such future acquisitions;
(e) the effect of fluctuations in currency exchange rates upon the
Company's international operations; and (f) the effect of non-
currency risks of investing in and conducting operations in foreign
countries, including those relating to political, social, economic
and regulatory factors.
-12-
<PAGE>
Part II Other Information
Item 6 Exhibits and Reports on Form 8-K
The following exhibits are included herein:
Exhibit (11) Statement Regarding Computation of Earnings Per Share
Exhibit (15) Independent Accountants' Review Report
Exhibit (15) Letter re: Unaudited Interim Financial Information
Exhibit (27) Financial Data Schedule
There were no reports on Form 8-K filed during the three months
ended September 30, 1997.
-13-
<PAGE>
SIGNATURE
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.
October 31, 1997 OM GROUP, INC.
____________________________________
James M. Materna
Chief Financial Officer
(Duly authorized signatory of OM Group, Inc.)
-14-
<PAGE>
Exhibit 11
OM GROUP, INC.
STATEMENT REGARDING COMPUTATION OF EARNINGS PER SHARE
Three Months Ended Nine Months Ended
September 30, September 30,
---------------------- ---------------------
1997 1996 1997 1996
---------- ---------- ---------- ----------
Average shares outstanding 22,086,874 18,759,375 20,550,603 18,759,375
Net effect of dilutive
stock options based
on the treasury stock
method 756,642 492,243 721,512 498,362
---------- ---------- ---------- ----------
Totals 22,843,516 19,251,618 21,272,115 19,257,737
========== ========== ========== ==========
Net income (000) $10,215 $7,670 $28,010 $22,404
====== ====== ======= =======
Per share amount $0.45 $0.40 $1.32 $1.16
====== ====== ======= =======
-15-
<PAGE>
Exhibit 15
Independent Accountants' Review Report
Stockholders and Board of Directors
OM Group, Inc.
We have reviewed the accompanying condensed consolidated balance sheet of
OM Group, Inc. as of September 30, 1997, and the related condensed
consolidated statements of income for the three-month and nine-month periods
ended September 30, 1997 and 1996, and the condensed consolidated statements
of cash flows for the nine-month periods ended September 30, 1997 and 1996.
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 OM Group, Inc. as of December 31,
1996, 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 January 30, 1997, 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 December 31,
1996, is fairly stated, in all material respects, in relation to the
consolidated balance sheet from which it has been derived.
/s/ Ernst & Young LLP
---------------------
Ernst & Young LLP
Cleveland, Ohio
October 31, 1997
<PAGE>
Exhibit 15
Acknowledgment of Independent Accountants
Stockholders and Board of Directors
OM Group, Inc.
We are aware of the incorporation by reference in the following Registration
Statements of OM Group, Inc. of our reports dated May 5, 1997, August 1, 1997
and October 31, 1997, relating to the unaudited condensed consolidated interim
financial statements of OM Group, Inc. which are included in its Form
10-Q for the quarters ended March 31, 1997, June 30, 1997 and September 30,
1997:
Registration
Number Description Filing Date
- ------------ ----------------------------------------- ---------------
33-74674 OM Group, Inc. Long-Term Incentive
Compensation Plan - Form S-8 Registration
Statement - 1,015,625 Shares January 27, 1994
333-07529 OMG Americas, Inc. Employees' Profit Sharing
Plan -- Form S-8 Registration Statement
- 250,000 Shares July 3, 1996
333-07531 OM Group, Inc. Non-Employees Directors'
Equity Plan -- Form S-8 Registration
Statement - 250,000 Shares July 3, 1996
Pursuant to Rule 436(c) of the Securities Act of 1933 our reports are not a
part of the registration statements prepared or certified by accountants
within the meaning of Section 7 or 11 of the Securities Act of 1933.
/s/ Ernst & Young LLP
---------------------
Ernst & Young LLP
Cleveland, Ohio
October 31, 1997
<TABLE> <S> <C>
<ARTICLE>5
<LEGEND>
This schedule contains summary financial information extracted from the OM
Group, Inc. Condensed Consolidated Balance Sheets at September 30, 1997
(Unaudited) and the OM Group, Inc. Condensed Consolidated Statements of Income
for the three and nine months ended September 30, 1997 (Unaudited) and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER>1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 9-MOS
<FISCAL-YEAR-END> Dec-31-1997 Dec-31-1997
<PERIOD-END> Sep-30-1997 Sep-30-1997
<CASH> 6,766 6,766
<SECURITIES> 0 0
<RECEIVABLES> 82,825 82,825
<ALLOWANCES> 0 0
<INVENTORY> 228,864 228,864
<CURRENT-ASSETS> 325,954 325,954
<PP&E> 213,492 213,492
<DEPRECIATION> 69,752 69,752
<TOTAL-ASSETS> 595,632 595,632
<CURRENT-LIABILITIES> 84,496 84,496
<BONDS> 0 0
0 0
0 0
<COMMON> 222 222
<OTHER-SE> 293,759 293,759
<TOTAL-LIABILITY-AND-EQUITY> 595,632 595,632
<SALES> 126,317 360,706
<TOTAL-REVENUES> 126,317 360,706
<CGS> 96,368 274,696
<TOTAL-COSTS> 96,368 274,696
<OTHER-EXPENSES> 11,629 34,125
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 3,132 10,286
<INCOME-PRETAX> 15,419 42,242
<INCOME-TAX> 5,204 14,232
<INCOME-CONTINUING> 10,215 28,010
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 10,215 28,010
<EPS-PRIMARY> .45 1.32
<EPS-DILUTED> .45 1.32
