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, 1999
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 1-475
A.O. SMITH CORPORATION
Delaware 39-0619790
(State of Incorporation) (IRS Employer ID Number)
P. O. Box 245008, Milwaukee, Wisconsin 53224-9508
Telephone: (414) 359-4000
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 and (2) has been subject to such filing requirements for
the past 90 days. Yes _X_ No ___
Class A Common Stock Outstanding as of September 30, 2000 8,690,125 shares
Common Stock Outstanding as of September 30, 2000 14,847,142 shares
Exhibit Index Page 15
<PAGE>
Index
A.O. Smith Corporation
Part I. Financial Information
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Statements of Earnings and Retained Earnings
- Three and nine months ended September 30, 2000 and 1999 3
Condensed Consolidated Balance Sheet
- September 30, 2000 and December 31, 1999 4
Condensed Consolidated Statement of Cash Flows
- Nine months ended September 30, 2000 and 1999 5
Notes to Condensed Consolidated Financial Statements
- September 30, 2000 6-8
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 9-11
Item 3. Quantitative and Qualitative Disclosure of Market Risk 12
Part II. Other Information
Item 1. Legal Proceedings 13
Item 4. Submission of Matters to a Vote of Security Holders 13
Item 5. Other Information 13
Item 6. Exhibits and Reports on Form 8-K 13
Signatures 14
Index to Exhibits 15
2
<PAGE>
PART I--FINANCIAL INFORMATION
-----------------------------
ITEM 1--FINANCIAL STATEMENTS
----------------------------
<TABLE>
A.O. SMITH CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
AND RETAINED EARNINGS
Three and Nine Months ended September 30, 2000 and 1999
(000 omitted except for per share data)
(unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
September 30 September 30
------------ ------------
2000 1999 2000 1999
---- ---- ---- ----
Continuing Operations
<S> <C> <C> <C> <C>
Electric Motor Technologies $ 206,567 $ 211,609 $ 702,688 $ 516,148
Water Systems Technologies 75,018 75,797 245,221 236,536
-------- -------- -------- --------
Net sales 281,585 287,406 947,909 752,684
Cost of products sold 233,196 232,678 765,167 602,566
-------- -------- -------- --------
Gross profit 48,389 54,728 182,742 150,118
Selling, general and administrative expenses 29,281 31,017 97,715 78,616
Interest expense 5,595 3,866 16,759 7,851
Interest income (88) (498) (492) (1,018)
Other expense - net 2,127 1,854 7,680 5,031
-------- -------- -------- --------
11,474 18,489 61,080 59,638
Provision for income taxes 4,131 6,011 21,989 20,991
-------- -------- -------- --------
Earnings from Continuing Operations 7,343 12,478 39,091 38,647
Discontinued Operations (note 4)
Earnings (loss) from operations less related
income tax provision (benefit) 2000 - $977 & $2,051;
1999 - ($34) & ($522) 1,493 (112) 3,139 (964)
Loss on disposition less related
income tax benefit 2000 - $798 - - (1,222) -
-------- -------- -------- --------
Net Earnings 8,836 12,366 41,008 37,683
======== ======== ======== ========
Retained Earnings
Balance at beginning of period 557,759 519,693 531,204 499,954
Net Earnings 8,836 12,366 41,008 37,683
Cash dividends on common shares (3,044) (2,786) (8,661) (8,364)
-------- -------- -------- --------
Balance at End of Period $ 563,551 $ 529,273 $ 563,551 $ 529,273
======== ======== ======== ========
Basic Earnings (Loss) per Common Share (note 8)
Continuing Operations $0.31 $0.54 $1.68 $1.67
Discontinued Operations 0.07 (0.01) 0.08 (0.04)
-------- -------- -------- --------
Net Earnings $0.38 $0.53 $1.76 $1.63
======== ======== ======== ========
Diluted Earnings (Loss) per Common Share (note 8)
Continuing Operations $0.31 $0.52 $1.65 $1.63
Discontinued Operations 0.06 - 0.08 (0.04)
-------- -------- -------- --------
Net Earnings $0.37 $0.52 $1.73 $1.59
======== ======== ======== ========
Dividends per Common Share $0.13 $0.12 $0.37 $0.36
See accompanying notes to unaudited condensed consolidated financial statements.
</TABLE>
3
<PAGE>
PART I--FINANCIAL INFORMATION
-----------------------------
ITEM 1--FINANCIAL STATEMENTS
----------------------------
<TABLE>
A.O. SMITH CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
September 30, 2000 and December 31, 1999
(000 omitted)
<CAPTION>
(unaudited)
September 30, 2000 December 31, 1999
------------------ -----------------
Assets
Current Assets
<S> <C> <C>
Cash and cash equivalents (note 2) $ 8,496 $ 14,761
Receivables 186,891 183,442
Inventories (note 5) 171,547 163,443
Deferred income taxes 11,464 11,323
Other current assets 11,224 5,253
Net current assets - discontinued operations (note 4) 21,576 10,405
----------- -----------
Total Current Assets 411,198 388,627
Property, plant and equipment 541,323 518,741
Less accumulated depreciation 260,113 235,248
----------- -----------
Net property, plant and equipment 281,210 283,493
Goodwill and other intangibles 246,555 251,085
Other assets 104,346 88,990
Net long-term assets - discontinued operations (note 4) 48,669 51,791
----------- -----------
Total Assets $ 1,091,978 $ 1,063,986
=========== ===========
Liabilities
Current Liabilities
Trade payables $ 97,986 $ 81,221
Accrued payroll and benefits 31,952 32,272
Accrued liabilities 26,448 27,301
Product warranty 11,665 10,847
Income taxes 580 7,170
Long-term debt due within one year 9,629 9,629
----------- -----------
Total Current Liabilities 178,260 168,440
Long-term debt (note 6) 321,662 351,251
Other liabilities 67,609 64,536
Deferred income taxes 62,596 48,675
----------- -----------
Total Liabilities 630,127 632,902
Stockholders' Equity
Class A common stock, $5 par value: authorized
14,000,000 shares; issued 8,722,720 43,614 43,615
Common stock, $1 par value: authorized 60,000,000
shares; issued 23,826,642 23,827 23,826
Capital in excess of par value 53,407 53,026
Retained earnings (note 6) 563,551 531,204
Accumulated other comprehensive loss (note 7) (6,098) (3,238)
Treasury stock at cost (216,450) (217,349)
----------- -----------
Total Stockholders' Equity 461,851 431,084
----------- -----------
Total Liabilities and Stockholders' Equity $ 1,091,978 $ 1,063,986
=========== ===========
See accompanying notes to unaudited condensed consolidated financial statements.
</TABLE>
4
<PAGE>
PART I--FINANCIAL INFORMATION
-----------------------------
ITEM 1--FINANCIAL STATEMENTS
----------------------------
<TABLE>
A.O. SMITH CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Nine Months Ended September 30, 2000 and 1999
(000 omitted)
(unaudited)
<CAPTION>
Nine Months Ended
September 30
------------
2000 1999
---- ----
Operating Activities
Continuing
<S> <C> <C>
Earnings from continuing operations $ 39,091 $ 38,647
Adjustments to reconcile net earnings to net cash provided
by (used in) operating activities:
Depreciation 27,796 21,720
Amortization 6,352 4,444
Net change in current assets and liabilities (82) (7,551)
Net change in other noncurrent assets and liabilities (2,665) (11,987)
Other 1,147 508
----------- -----------
Cash Provided by Operating Activities 71,639 45,781
Investing Activities
Capital expenditures (30,114) (22,198)
Other (762) (1,141)
Acquisition of business - (251,361)
----------- -----------
Cash Used in Investing Activities (30,876) (274,700)
----------- -----------
Cash Flow Before Financing Activities 40,763 (228,919)
Discontinued
Cash Used in Discontinued Operations (9,788) (2,006)
Financing Activities
Debt incurred - 217,780
Debt retired (29,589) (4,629)
Purchase of treasury stock - (2,745)
Net proceeds from common stock and option activity 608 504
Tax benefit from exercise of stock options 402 792
Dividends paid (8,661) (8,364)
----------- -----------
Cash Provided by (Used in) Financing Activities (37,240) 203,338
----------- -----------
Net decrease in cash and cash equivalents (6,265) (27,587)
Cash and cash equivalents-beginning of period (note 2) 14,761 37,666
----------- -----------
Cash and Cash Equivalents - End of Period $ 8,496 $ 10,079
=========== ===========
See accompanying notes to unaudited condensed consolidated financial statements.
</TABLE>
5
<PAGE>
PART I - FINANCIAL INFORMATION
------------------------------
ITEM 1 - FINANCIAL STATEMENTS
-----------------------------
A. O. SMITH CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2000
(unaudited)
1. Basis of Presentation
The condensed consolidated financial statements presented herein are based
on interim figures and are subject to audit. In the opinion of management,
all adjustments consisting of normal accruals considered necessary for a
fair presentation of the results of operations and of financial position
have been made. The results of operations for the three and nine-month
periods ended September 30, 2000 are not necessarily indicative of the
results expected for the full year. The condensed consolidated balance
sheet as of December 31, 1999 is derived from the audited financial
statements but does not include all disclosures required by generally
accepted accounting principles. Certain prior year amounts have been
reclassified to conform to the 2000 presentation.
2. Statement of Cash Flows
For purposes of the Consolidated Statement of Cash Flows, cash and cash
equivalents include short-term investments held primarily for cash
management purposes. These investments normally mature within three months
from the date of acquisition.
3. Acquisition
On August 2, 1999, the company acquired the assets of MagneTek, Inc.'s
(MagneTek) domestic electric motor business and six wholly owned foreign
subsidiaries for $244.6 million. The purchase price was allocated to the
assets acquired and the liabilities assumed based upon current estimates of
their respective fair values at the date of acquisition.
In connection with the MagneTek acquisition, the company recorded
additional purchase liabilities of $17.9 million, which included employee
severance and relocation, as well as certain facility exit costs. Total
costs incurred and charged against the liability to date totaled $2.5
million.
4. Discontinued Operations
In the first quarter, the company decided to divest its fiberglass piping
and liquid and dry bulk storage tank businesses. Net sales of these
businesses were $33.4 and $96.0 million for the three- and nine-month
periods ended September 30, 2000 and $30.9 and $85.7 million for the three-
and nine-month periods ended September 30, 1999.
The operating results of the discontinued businesses have been reported
separately as discontinued operations in the accompanying financial
statements. Certain expenses have been allocated to the discontinued
operations, including interest expense, which was allocated based on the
ratio of net assets of the discontinued businesses to the total
consolidated capital of the company.
6
<PAGE>
5. Inventories (000 omitted)
Sept. 30, 2000 Dec. 31, 1999
-------------- -------------
Finished products $ 111,995 $ 99,335
Work in process 35,660 40,197
Raw materials 40,950 41,997
Supplies 889 1,322
-------- --------
189,494 182,851
Allowance to state inventories
at LIFO cost 17,947 19,408
-------- --------
$ 171,547 $ 163,443
======== ========
6. Long-Term Debt
The company's credit agreement and term notes contain certain conditions
and provisions which restrict the company's payment of dividends. Under the
most restrictive of these provisions, retained earnings of $70.1 million
were unrestricted as of September 30, 2000. The company renewed its $100
million credit facility, which now expires on July 27, 2001. In addition,
the company has available a $250 million credit facility that expires
August 2, 2004.
7. Comprehensive Earnings (Loss)
The company's comprehensive earnings were $7.4 and $38.1 million for the
three- and nine-month periods ended September 30, 2000 and $12.6 and $36.9
million for the three- and nine-month periods ended September 30, 1999.
Comprehensive earnings, for all periods presented, were comprised of net
earnings and foreign currency translation adjustments. No provisions or
benefits for U.S. income taxes have been made on these foreign currency
translation adjustments.
7
<PAGE>
8. Earnings per Share of Common Stock
The numerator for the calculation of basic and diluted earnings per share
is net earnings. The following table sets forth the computation of basic
and diluted weighted-average shares used in the earnings per share
calculations:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
Sept. 30 Sept. 30
---------------------------- ---------------------------
2000 1999 2000 1999
---------------------------- ---------------------------
<S> <C> <C> <C> <C>
Denominator for basic earnings
per share
- weighted-average shares 23,371,624 23,189,535 23,365,685 23,188,520
Effect of dilutive stock options 254,276 655,900 320,586 582,825
---------- ---------- ---------- ----------
Denominator for diluted earnings
per share 23,625,900 23,845,435 23,686,271 23,771,345
========== ========== ========== ==========
</TABLE>
9. Operations by Segment
(000 omitted)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
Sept. 30 Sept. 30
---------------------------- ---------------------------
2000 1999 2000 1999
---------------------------- ---------------------------
<S> <C> <C> <C> <C>
Net Sales
Electric Motor Technologies $ 206,567 $ 211,609 $ 702,688 $ 516,148
Water Systems Technologies 75,018 75,797 245,221 236,536
---------- ---------- ---------- ----------
Net Sales $ 281,585 $ 287,406 $ 947,909 $ 752,684
========== ========== =========== ==========
Earnings before Interest and Taxes
Electric Motor Technologies $ 15,643 $ 20,331 $ 70,202 $ 59,845
Water Systems Technologies 7,086 7,313 25,536 24,496
---------- ---------- ---------- ----------
Total Segments 22,729 27,644 95,738 84,341
General Corporate and Research
and Development Expenses (5,748) (5,787) (18,391) (17,870)
Interest Expense - Net (5,507) (3,368) (16,267) (6,833)
---------- ---------- ---------- ----------
Earnings before Income Taxes 11,474 18,489 61,080 59,638
Provision for Income Taxes (4,131) (6,011) (21,989) (20,991)
---------- ---------- ---------- ----------
Earnings from Continuing Operations $ 7,343 $ 12,478 $ 39,091 $ 38,647
========== ========== =========== ==========
Intersegment sales, which are immaterial, have been excluded from segment revenues.
</TABLE>
8
<PAGE>
PART I - FINANCIAL INFORMATION
------------------------------
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
----------------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS
-----------------------------------
RESULTS OF OPERATIONS
---------------------
FIRST NINE MONTHS OF 2000 COMPARED TO 1999
------------------------------------------
Sales in the third quarter of 2000 were $281.6 million or 2% less than last
year's third quarter sales of $287.4 million. When compared with the same
quarter in the prior year, the third quarter 2000 sales included the beneficial
impact of an additional month of sales from the MagneTek motor acquisition.
Excluding the acquisition, sales were 9% lower than the third quarter of 1999 as
a result of softer HVAC market conditions. Sales for the first nine months of
2000 were $947.9 million or almost 26% higher than the $752.7 million of sales
in the same period last year. The year to date increase in sales reflects an
additional seven months of sales associated with the MagneTek acquisition when
compared with 1999.
Third quarter earnings from continuing operations were $7.3 million or $5.2
million lower than last year's third quarter earnings of $12.5 million.
Continuing earnings for the first nine months of 2000 were $39.1 million or $.5
million higher than earnings of $38.6 million in the same period last year. On a
diluted per share basis, third quarter continuing earnings declined from $.52 in
1999 to $.31 in 2000. Continuing earnings per share for the first nine months of
2000 were $1.65 compared with $1.63 in the same period last year. Earnings for
the third quarter reflect the adverse impact of declining sales volume on cost
absorption. The first nine months of 2000 reflect the additional seven months
earnings associated with the MagneTek acquisition offset by increased interest
expense.
The gross profit margin for the third quarter declined from 19% in 1999 to 17.2%
in 2000. The year to date gross profit margin in 2000 was 19.3% compared with
19.9% in the same period in 1999. The lower margins in both the third quarter
and first nine months of 2000 resulted from the inclusion of the MagneTek motors
business, as well as less favorable cost absorption associated with declining
volume.
Third quarter sales of Electric Motor Technologies were $206.6 million or $5
million lower than the third quarter of 1999 sales of $211.6 million. Year to
date sales for this segment were $702.7 million, an increase of $186.6 million
over sales of $516.1 million in the same period last year. Excluding sales
associated with the August 2, 1999 motor business acquisition, total motor sales
declined approximately 13% compared with the third quarter of 1999. Sales in
both the third quarter and first nine months have been adversely impacted by a
reduction in demand from heating and air conditioning industry customers
confronted with record levels of finished product inventory.
Third quarter operating profits of Electric Motor Technologies declined from
$20.3 million in 1999 to $15.6 million in 2000. On a year to date basis,
earnings increased $10.4 million from $59.8 million in 1999 to $70.2 million in
2000. The lower third quarter earnings resulted from lower sales and production
volumes and associated cost absorption. Year to date earnings reflect margin
earned on the additional sales volume from the motor business acquisition and a
$2.3
9
<PAGE>
million favorable adjustment to the vacation accrual recorded in the second
quarter as a result of a change in the company's vacation policy for certain
employees.
As part of the overall plan to integrate MagneTek and improve operating margin,
Electric Motor Technologies continues to move production to its lower cost
facilities. Consistent with this strategy, this segment recently announced that
it would be closing three motor manufacturing facilities within the next nine
months.
Third quarter sales for Water Systems Technologies were $75 million in 2000,
slightly lower than 1999 third quarter sales of $75.8 million. A softening in
the housing market contributed to an 8% decline in sales of residential product
and offset higher sales in the company's Chinese water heater operation. Sales
for the first nine months of 2000 were $245.2 million or $8.7 million higher
than the same period in 1999 reflecting higher volume for the China operation.
Water Systems Technologies 2000 third quarter earnings were $.2 million lower
than the third quarter of 1999 due to the decline in residential volume. Year to
date earnings exceeded those of the same period last year primarily as a result
of lower losses in China.
Selling, general, and administrative (SG&A) expense in the third quarter was
$1.7 million less than the same period last year due to lower selling expenses
and lower accruals for incentive plans. On a year to date basis, SG&A increased
$19.1 million over last year due to the motors acquisition. Relative to sales,
year to date SG&A was consistent in 1999 and 2000.
Net interest expense for the third quarter and first nine months of 2000
exceeded that of the comparable periods in 1999 by $2.1 million and $9.4
million, respectively. The increased financing cost was due to the debt incurred
with the MagneTek acquisition and higher interest rates.
Other expense in the third quarter of 2000 was $.3 million higher than the same
period in 1999 due to the recognition of an additional month of goodwill
amortization associated with the August 2, 1999 motors business acquisition.
Other expense for the first nine months of 2000 was $2.6 million higher than the
same period last year due primarily to increased goodwill amortization.
The effective tax rate for the third quarter of 2000 was 36% compared with 32.5%
in the third quarter of 1999. 1999 benefited from recognition of tax credits
associated with the resolution of the company's research and development tax
credit claim. The company's effective tax rate for the first nine months of 2000
was 36% and compared with 35.2% in 1999 which reflected the aforementioned tax
credit.
In the first quarter, the company announced its intent to exit the fiberglass
pipe and storage tank markets and accordingly, Smith Fiberglass Company and A.
O. Smith Engineered Storage Products Company have been classified as
discontinued operations in the accompanying financial statements. Sales for
these discontinued operations were $33.4 million in the third quarter of 2000
and compared with 30.9 million in the same quarter last year. Year to date sales
for 2000 and 1999 were $96 million and 85.7 million, respectively. The after-tax
profits in 2000 for Engineered Storage Products Company were $1.5 million in the
third quarter and $3.1 million in the first nine months of 2000, compared with
$1.1 million and $2.3 million in the same periods in
10
<PAGE>
1999. Fiscal 1999 discontinued after-tax operating losses of $.1 million and $1
million for the three and nine month periods included both discontinued
businesses. The after-tax results for Smith Fiberglass Products Company for the
three and nine months ended September 30, 2000 were breakeven and $1 million
loss, respectively. Fiscal 2000 Smith Fiberglass losses have been charged to the
disposition reserves established at December 31, 1999. At September 30, 2000,
the company believes such reserves are adequate and expects its divestitures to
be completed in the fourth quarter of 2000.
Outlook
The company recently disclosed that it expects the fourth quarter to be
extremely difficult as its customers significantly reduce production levels to
lower their inventories. As a result, the company expects to experience weak
sales and excess manufacturing costs. Fourth quarter earnings are expected to
range between $.05 and $.15 per share.
Given current market conditions, the company expects sales and earnings during
the first and second quarters of 2001 to fall short of the record results
generated during the first two quarters of the current year. Once customers'
surplus inventories have been eliminated, sales and earnings comparisons are
expected to improve as the year progresses. For the full year, the company
expects 2001 earnings to exceed 2000 results.
Liquidity & Capital Resources
The company's working capital to support continuing operations was $211.4
million at September 30, 2000 compared with the $209.8 million at December 31,
1999. Increases to inventories as a result of weaker HVAC markets and a
reduction in the income tax liability were offset by increases to accounts
payable.
Cash provided by continuing operations for the year-to-date period ended
September 30, 2000 was $40.8 million compared with $22.4 million during the same
period one year ago. Improved working capital was the most significant factor in
the increase in cash flow. The company expects cash flow from continuing
operations for the year to be $45 to $50 million.
Capital expenditures during the first nine months of 2000 were $30.1 million
compared with $22.2 million through September 30, 1999. All of the capital
spending increase was related to higher spending in the motor business due to
the MagneTek motor acquisition. The company projects total capital spending in
2000 to be higher than in 1999, but expects such capital expenditures to be
covered by cash flow from operations.
The company's long-term debt decreased $29.6 million in the first nine months of
2000. The company's leverage as measured by the ratio of total debt to total
capitalization was 42% at the end of the third quarter compared with 46% at the
end of last year.
In connection with the MagneTek acquisition in August 1999, additional purchase
liabilities of $17.9 million were recorded, which included employee severance
and relocation, as well as certain facility exit costs. Costs incurred and
charged against the purchase liabilities totaled $2.5 million to date.
11
<PAGE>
At its October 10, 2000 meeting, A. O. Smith's Board of Directors declared a
regular cash dividend of $.13 per share on its common stock (Class A Common and
Common). The dividend is payable on November 15, 2000 to shareholders of record
October 31, 2000.
ITEM 3. - QUANTITATIVE AND QUALITATIVE DISCLOSURE OF MARKET RISK
----------------------------------------------------------------
As is more fully described in the company's annual report on Form 10-K for the
year ended December 31, 1999, the company is exposed to various types of market
risks, primarily currency and certain commodities. The company monitors its
risks in such areas on a continuous basis and, generally enters into futures
contracts to minimize such exposures for periods of less than one year. The
company does not engage in speculation in its derivatives strategies. It is
important to note that gains and losses from the company's futures contract
activities are offset by changes in the underlying costs of the transactions
being hedged.
Forward Looking Statements
Certain statements in this report are "forward-looking statements." These
forward-looking statements can generally be identified as such because the
context of the statement will include words such as the company "believes,"
"anticipates," "estimates," "expects," "projects," or words of similar import.
Although the company believes that its expectations are based upon reasonable
assumptions within the bounds of its knowledge of its business, there can be no
assurance that the results expressed in forward-looking statements will be
realized. Although a significant portion of the company's sales are derived from
the replacement of previously installed product, and such sales are therefore
less volatile, numerous factors may affect actual results and cause results to
differ materially from those expressed in forward-looking statements made by, or
on behalf of, the company. The company considers most important among such
factors, the stability in its electric motor and water products markets, the
timely and proper integration of the MagneTek motors acquisition, and the
implementation of associated cost reduction programs.
All subsequent written and oral forward-looking statements attributable to the
company, or persons acting on its behalf, are expressly qualified in their
entirety by these cautionary statements.
12
<PAGE>
PART II - OTHER INFORMATION
---------------------------
ITEM 1 - LEGAL PROCEEDINGS
--------------------------
There have been no material changes in the legal and environmental matters
previously reported in Part 1, Item 3 and Note 12 of the Notes to Consolidated
Financial Statements in the company's Form 10-K Report for the year ended
December, 1999 and in Part 2, Item 1 in the quarterly reports on Form 10-Q for
the quarter ended June 30, 2000, all of which are incorporated herein by
reference.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------------------------------------------------------------
None.
ITEM 5 - OTHER INFORMATION
--------------------------
The Board of Directors elected, effective August 6, 2000, Kenneth W. Krueger
senior vice president and chief financial officer of the Corporation. Mr. Glen
R. Bomberger, who resigned as chief financial officer, continues as executive
vice president of the Corporation.
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
-----------------------------------------
None.
13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has authorized this report to be signed on its behalf by the
undersigned.
A. O. SMITH CORPORATION
October 20, 2000 /s/ John J. Kita
----------------
John J. Kita
Vice President,
Treasurer and Controller
October 20, 2000 /s/ Kenneth W. Krueger
----------------------
Kenneth W. Krueger
Senior Vice President
and Chief Financial Officer
14
<PAGE>
INDEX TO EXHIBITS
-----------------
Exhibit
Number Description
------ -----------
(27) Financial Data Schedule
(27-1) Restated Financial Data Schedule
15
