FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1997
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: 1-12754
O'SULLIVAN INDUSTRIES HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Delaware 43-1659062
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1900 Gulf Street, Lamar, Missouri 64759-1899
(Address of principal executive offices) (ZIP Code)
(417) 682-3322
(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 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 [ ]
As of February 4, 1998, 16,151,075 shares of Common Stock of
O'Sullivan Industries Holdings, Inc., par value $1.00 per share,
and associated preferred stock purchase rights were outstanding.
<PAGE>
PART I
========
ITEM 1. FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
O'SULLIVAN INDUSTRIES HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(in thousands, except for share data)
December 31, June 30,
Assets: 1997 1997
------ ------------ -----------
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 1,557 $ 6,975
Trade receivables, net of allowance for
doubtful accounts of $1,437 and $3,158,
respectively 71,209 58,661
Inventories:
Finished merchandise 27,531 29,840
Work in process 5,225 4,224
Raw materials 9,527 10,094
--------- ---------
42,283 44,158
Prepaid expenses and other current assets 3,895 3,134
--------- ---------
Total current assets 118,944 112,928
--------- ---------
Property, plant and equipment, at cost 135,387 119,566
Less accumulated depreciation and
amortization (48,266) (44,643)
--------- ---------
87,121 74,923
Goodwill, net of accumulated amortization 43,922 44,756
--------- ---------
$ 249,987 $ 232,607
========= =========
Liabilities and Stockholders' Equity:
------------------------------------
Current liabilities:
Accounts payable $ 12,491 $ 7,234
Accrued liabilities 22,752 19,481
Income taxes payable 3,454 4,168
--------- ---------
Total current liabilities 38,697 30,883
--------- ---------
Long-term debt, less current maturities 38,000 30,000
Deferred income taxes 14,934 14,934
Stockholders' equity:
Preferred stock; $1.00 par value,
20,000,000 shares authorized,
none issued - -
Common stock; $1.00 par value,
100,000,000 shares authorized,
16,819,950 issued 16,820 16,820
Additional paid-in capital 87,727 87,968
Retained earnings 60,445 53,418
--------- ---------
164,992 158,206
Less common stock in treasury at cost,
587,545 and 94,000 shares, respectively 6,636 1,416
-------- --------
Total stockholders' equity 158,356 156,790
-------- --------
Commitments and contingencies
-------- --------
$249,987 $232,607
======== ========
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
<TABLE>
<CAPTION>
O'SULLIVAN INDUSTRIES HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(in thousands, except for per share data)
Three months ended Six months ended
December 31, December 31,
----------------- ------------------
1997 1996 1997 1996
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net sales $ 85,524 $ 80,593 $162,665 $163,719
Costs and expenses:
Cost of sales 62,138 56,967 116,541 117,541
Selling, marketing and
administrative 17,321 15,616 33,862 31,816
Interest, net 639 597 1,112 1,315
-------- -------- -------- --------
80,098 73,180 151,515 150,672
-------- -------- -------- --------
Income before income tax provision 5,426 7,413 11,150 13,047
Income tax provision 2,002 2,839 4,123 4,997
-------- -------- -------- --------
Net Income $ 3,424 $ 4,574 $ 7,027 $ 8,050
======== ======== ======== ========
Earnings per common share
Basic $ 0.21 $ 0.27 $ 0.42 $ 0.48
Diluted $ 0.20 $ 0.27 $ 0.41 $ 0.47
Weighted average common shares outstanding
Basic 16,496 16,787 16,575 16,797
Diluted 16,849 17,014 16,955 16,970
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
<TABLE>
<CAPTION>
O'SULLIVAN INDUSTRIES HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(in thousands)
Six months ended
December 31,
------------------
1997 1996
-------- -------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 7,027 $ 8,050
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 5,065 4,868
Employee option amortization 374 375
Changes in current assets and liabilities:
Trade receivables (12,548) (3,359)
Inventories 1,875 (2,280)
Other assets (825) 31
Accounts payable, accrued liabilities and
income taxes payable 7,440 7,301
-------- -------
Net cash provided by operating activities 8,408 14,986
-------- -------
Cash flows for investing activities:
Capital expenditures (16,429) (4,660)
Cash flows from financing activities:
Addition to long-term debt 8,000 -
Purchase of common stock for treasury (7,298) (1,493)
Exercise of stock options 101 -
Sale of common stock to employee benefit plans 1,800 1,039
-------- -------
Net cash flows provided (used)
for financing activities 2,603 (454)
-------- -------
Net increase (decrease) in cash and cash equivalents (5,418) 9,872
Cash and cash equivalents, beginning of period 6,975 506
-------- -------
Cash and cash equivalents, end of period $ 1,557 $10,378
======== =======
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
<TABLE>
<CAPTION>
O'SULLIVAN INDUSTRIES HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(UNAUDITED) (in thousands)
Preferred stock Common stock Additional
--------------- ----------------- paid-in
Shares Dollars Shares Dollars capital
------ ------- ------- ------- ----------
<S> <C> <C> <C> <C> <C>
Balance, June 30, 1997 - $ - 16,820 $16,820 $ 87,968
Net income - - - - -
Translation adjustment - - - - (64)
Purchase of common stock
Exercise of stock options (127)
Sale of common stock (50)
------ ------- -------- ------- --------
Balance, December 31, 1997 - $ - 16,820 $16,820 $ 87,727
====== ======= ======== ======= ========
</TABLE>
<TABLE>
<CAPTION>
Treasury stock Total
Retained ----------------- stockholders'
earnings Shares Dollars equity
-------- ------ ------- -------------
<S> <C> <C> <C> <C>
Balance, June 30, 1997 $ 53,418 (94) $(1,416) $ 156,790
Net income 7,027 7,027
Translation adjustment - (64)
Purchase of common stock (645) (7,298) (7,298)
Exercise of stock options 15 228 101
Sale of common stock 136 1,850 1,800
-------- ------ ------- --------
Balance, December 31, 1997 $ 60,445 (588) $(6,636) $ 158,356
======== ====== ======= ==========
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
O'SULLIVAN INDUSTRIES HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(UNAUDITED)
December 31, 1997
Note 1 - Basis of Presentation
The unaudited consolidated financial statements included
herein have been prepared by O'Sullivan Industries Holdings, Inc.
and subsidiaries (the "Company") in accordance with generally
accepted accounting principles for interim financial information
and with instructions in Form 10-Q and Article 10 of Regulation
S-X. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with
generally accepted accounting principles have been condensed or
omitted pursuant to such rules and regulations. The financial
statements should be read in conjunction with the audited
financial statements and notes thereto included in the Company's
Annual Report on Form 10-K for the year ended June 30, 1997. The
interim results are not necessarily indicative of the results
which may be expected for a full year.
Note 2 - Summary of Significant Accounting Policies
Earnings per Share: During the three months ended
December 31, 1997, the Company adopted Statement of Financial
Accounting Standards No. 128, Earnings per Share. The statement
requires dual presentation of basic and diluted earnings per
share ("EPS") on the face of the income statement for entities
with complex capital structures and requires a reconciliation of
the numerator and denominator of the basic EPS computation to the
numerator and denominator of the diluted EPS computation. Basic
EPS excludes dilution, while diluted EPS reflects the potential
dilution that could occur if securities or other contracts to
issue common stock were exercised or converted into common stock
or resulted in the issuance of common stock that then shared in
the earnings of the entity. EPS data for the period ended
December 31, 1997 and all prior periods has been restated to
conform with the provisions of this statement. The following is
a reconciliation of the numerator and denominator used in the
basic and diluted EPS calculation:
<PAGE>
<TABLE>
<CAPTION>
Three months ended Six months ended
December 31, December 31,
---------------------- -----------------------
1997 1996 1997 1996
---------- ---------- --------- ----------
<S> <C> <C> <C> <C>
Income available to
common stockholders
(numerator) 3,424,000 4,574,000 7,027,000 8,050,000
========== ========== ========== ==========
Weighted average shares
outstanding
(basic EPS denominator) 16,496,087 16,787,077 16,574,619 16,796,580
Effect of dilutive securities
--options 352,989 226,788 380,202 173,643
---------- ---------- ---------- ----------
Weighted average shares,
plus assumed conversions
(diluted EPS denominator) 16,849,076 17,013,865 16,954,821 16,970,223
========== ========== ========== ==========
</TABLE>
Options to purchase 373,000 additional shares of common stock at
prices ranging from $12.81 to $16.09 per share were outstanding
but were not included in the computation of diluted EPS because
the options' exercise prices were greater than the average market
price of the common shares, and thus the effect would have been
antidilutive.
Note 3 - Derivative Financial Instruments
Derivative financial instruments are utilized by the Company
to reduce interest rate risk. The Company does not hold or issue
derivative financial instruments for trading purposes. During
fiscal 1997, the Company entered into a forward starting interest
rate swap agreement with a notional principal amount of
$10 million. The effective date of the agreement is October 1,
1998 and the termination date is October 1, 2008. The Company
has contracted to pay a fixed rate of 7.13% and receive a
floating interest rate during the duration of the swap agreement.
The Company has the ability and intent to call its existing
$10.0 million of 8.25% industrial development revenue bonds
commencing October 1, 1998 at a redemption premium of 103%. The
bonds would be refinanced at the then existing interest rate.
Accordingly, the swap will have the effect of hedging the Company
against an increase in interest rates prior to the first
opportunity to refinance these bonds. Management has designated
this swap as a hedge of the future interest rate exposure of
refinancing these bonds.
Amounts to be paid or received under the swap agreement will
be accrued as interest rates change and will be recognized over
the life of the swap agreement as adjustments to interest
expense. Gains or losses on terminated swaps will be recognized
over the remaining life of the underlying obligation as an
adjustment to interest expense. The fair value of the forward
starting swap agreement approximated $722,000 at December 31,
1997 (representing the amount the Company would have to pay to
terminate the swap) and has not been recognized in the
Consolidated Financial Statements, since it is accounted for as a
hedge.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Results of Operations
- ---------------------
Net sales for the quarter ended December 31, 1997 increased
6.1% to $85.5 million from $80.6 million for the quarter ended
December 31, 1996. Sales for the six month period ended
December 31, 1997 decreased 0.6% to $162.7 million from
$163.7 million for the six months ended December 31, 1996.
During the quarter, sales increases in the regional mass
merchant, consumer electronics and export distribution channels
were offset, to some degree, by sales decreases in the home
improvement retail channel. The sales increases mentioned above
may be attributed primarily to sales efforts targeted toward
regional retail chains, the addition of new customers in the
consumer electronics area and sales growth in the Americas.
Sales of products introduced by a major home improvement retailer
in 1996 were not re-ordered in 1997, causing sales declines in
that channel of distribution. Despite the sales decrease, the
Company continues to believe that the home improvement channel
offers future sales growth opportunities.
For the six month period ended December 31, 1997, sales
decreased in the mass merchant distribution channel due to the
bankruptcy of a major customer, Best Products Co., Inc., in
September 1996. Sales to Best Products approximated $6.7 million
in the six months ended December 31, 1996; Best Products ceased
operations in early calendar 1997. Sales also decreased in the
discount mass merchant channel as a major discount retailer
placed unusually large orders for shipment during the fourth
quarter of fiscal 1997 and reduced purchases during the quarter
ended September 30, 1997. The customer returned to a more normal
purchasing pattern in the second quarter of this fiscal year.
These sales decreases were partially offset by increases in the
regional mass merchant, consumer electronics and export
distribution channels as discussed above. Sales to the office
superstore channel increased slightly during the quarter and six
months when compared to the same period of the prior year.
In July 1997, a large customer of the Company, Montgomery
Ward & Co., filed for bankruptcy protection under Chapter 11.
Montgomery Ward subsequently announced that it intended to close
33 Lechmere stores, 11 Electric Avenue outlets and 54 Montgomery
Ward stores. Montgomery Ward expects that it will be able to
reorganize its operations under Chapter 11 protection and will
continue to purchase products from the Company. Although sales
to Montgomery Ward for the quarter and six month period have
increased when compared to the prior year, the level of purchases
could decline as a result of reorganization or otherwise.
In the event that Montgomery Ward or another major customer
ceases or substantially reduces its purchases of products from
the Company, there can be no certainty that the Company will be
able to replace these sales.
Gross profit decreased slightly to $23.4 million, or 27.3%
of sales, for the three month period ended December 31, 1997,
from $23.6 million, or 29.3% of sales, for the comparable prior
year quarter. Gross profit was virtually unchanged at
$46.1 million, or 28.4% of sales, for the six month period ended
December 31, 1997, compared to $46.2 million, or 28.2% of sales
for the comparable prior year period. The Company's lower gross
margin during the quarter was primarily due to higher labor and
overhead costs associated with the implementation of new
manufacturing software systems, the installation of new equipment
and the related adaptation of manufacturing processes. The
Company believes that these additions and improvements will
better enable the Company to meet demand, enhance efficiency and
support long-term growth of the Company. These changes are
expected to affect sales and gross profits during the remainder
of the fiscal year, although the Company continues to take steps
to minimize the impact.
Selling, marketing and administrative expenses increased to
$17.3 million, or 20.3% of sales, for the three month period
ended December 31, 1997, from $15.6 million, or 19.4% of sales,
for the three months ended December 31, 1996. Selling, marketing
and administrative expenses for the six month period ended
December 31, 1997, increased to $33.9 million, or 20.8% of sales,
from $31.8 million, or 19.4% of sales, for the comparable prior
year period. The increase in selling, marketing and
administrative expenses for the quarter is due primarily to
increased advertising and promotional costs and, to a lesser
extent, increased salaries and wages due to additional
management, marketing and MIS staff. For the six months ended
December 31, 1997, increased advertising, store display expenses
and salaries are offset to some degree by decreased bad debt
expense associated with the Best Products bankruptcy in fiscal
1997.
Interest expense increased slightly during the quarter as
borrowings increased in comparison to the prior year. Interest
expense of $1.1 million for the six months ended December 31,
1997 decreased from $1.3 million in the first half of fiscal 1997
due to greater interest income during the first quarter of fiscal
1998. The Company utilized cash on hand and increased borrowings
primarily for equipment purchases and share repurchases in the
current fiscal year. Interest expense is expected to be higher
during the remainder of the fiscal year when compared to the
prior year periods primarily due to less interest income and
increased borrowings expected during the remainder of this fiscal
year.
Liquidity and Capital Resources
- -------------------------------
Cash provided by operating activities during the six month
period ended December 31, 1997, amounted to $8.4 million compared
to $15.0 million in the comparable prior year period. The
decrease in cash flows resulted from a larger increase in
receivables during the six months related to higher sales levels
and lower anticipatory cash payments taken in the December 31,
1997 quarter compared to the prior year period, partially offset
by a decreased investment in inventories. Cash used in investing
activities for the first six months of fiscal 1998 included
approximately $16.4 million for capital expenditures compared to
$4.7 million for the comparable prior year period. Current year
additions primarily relate to equipment to improve production
capabilities, to increase capacity in the Company's Virginia
facility and to improve manufacturing efficiencies.
The Company has an unsecured $25.0 million revolving credit
facility with a bank that expires on February 28, 2000. The
Credit Facility also includes a $10.8 million standby letter of
credit established in favor of Tandy Corporation. The letter of
credit indemnifies Tandy Corporation from its obligations as
guarantor of $10.0 million of industrial revenue bonds for which
a subsidiary of the Company is the obligor. Tandy Corporation
can draw against the standby letter of credit only in the event
that it must pay any amounts with respect to the bonds.
The Credit Agreement has several financial ratio covenants
including the maintenance of a minimum working capital ratio and
a minimum net worth. In addition, the Credit Agreement has
provisions specifying certain limitations on dividends,
investments and future indebtedness. The Company is currently in
compliance with all of its debt agreements.
At December 31, 1997, the Company had long-term debt
outstanding of $38.0 million; $10.0 million of industrial revenue
bonds that bear interest at 8.25% and mature on October 1, 2008;
$20.0 million in private placement debt with certain insurance
companies at 8.01% due fiscal 2003; and $8.0 million under the
Company's revolving credit facility.
On May 6, 1997, the Company announced that its Board of
Directors had authorized the purchase of up to five percent of
the outstanding shares of its common stock during the next 24
months. The actual number of shares purchased, the timing of the
purchases and the prices paid for the shares will be dependent
upon future market conditions. Funding for the purchases is
expected to come from available working capital and existing
borrowing facilities. The program includes no specific pricing
nor timing targets and may be suspended at any time or terminated
prior to completion. For the three months ended December 31,
1997, the Company purchased 270,000 shares of its stock for
approximately $2.6 million. For the six months ended
December 31, 1997, the Company purchased 477,000 shares for
approximately $5.2 million.
The Company also purchases Company common stock to fund its
employee benefit programs. During the three months ended
December 31, 1997, the Company purchased 80,000 shares of the
Company's common stock at a cost of approximately $0.9 million;
shares with a cost of approximately $0.8 million were transferred
to the Company's employee benefit plans. For the six months
ended December 31, 1997, the Company purchased 168,000 shares at
a cost of approximately $2.1 million and transferred shares with
a cost of $1.9 million to the Company's employee benefit plans.
Derivative financial instruments are utilized by the Company
to reduce interest rate risk. The Company does not hold or issue
derivative financial instruments for trading purposes. During
fiscal 1997, the Company entered into a forward starting interest
rate swap agreement with a notional principal amount of
$10 million. The effective date of the agreement is October 1,
1998 and the termination date is October 1, 2008. The Company
has contracted to pay a fixed rate of 7.13% and receive a
floating interest rate during the duration of the swap agreement.
The Company has the ability and intent to call its existing
$10.0 million of 8.25% industrial development revenue bonds
commencing October 1, 1998 at a redemption premium of 103%. The
bonds would be refinanced at the then existing interest rate.
Accordingly, the swap will have the effect of hedging the Company
against an increase in interest rates prior to the first
opportunity to refinance these bonds. Management has designated
this swap as a hedge of the future interest rate exposure of
refinancing these bonds.
Amounts to be paid or received under the swap agreement will
be accrued as interest rates change and will be recognized over
the life of the swap agreement as adjustments to interest
expense. Gains or losses on terminated swaps will be recognized
over the remaining life of the underlying obligation as an
adjustment to interest expense. The fair value of the forward
starting swap agreement approximated $722,000 at December 31,
1997 (representing the amount the Company would have to pay to
terminate the swap) and has not been recognized in the
Consolidated Financial Statements, since it is accounted for as a
hedge.
The Company believes that cash flow from operations,
existing cash and current unused balances under existing credit
agreements will be sufficient to fund the Company's operations in
fiscal 1998, as well as capital expenditures and share
repurchases. Fiscal 1998 capital expenditures are currently
estimated in the range of $30.0 to $35.0 million for increased
production capacity, improved productivity, enhanced new product
development and replacement equipment.
Year 2000 Software Compliance
- -----------------------------
Since fiscal 1996, the Company has been implementing a new
integrated software package to support the Company's sales,
manufacturing and accounting functions. The installation of this
software package is expected to be complete by June 30, 1998. In
addition to providing the support necessary for more efficient
operation of the Company, the software package is capable of
handling dates subsequent to December 31, 1999. The Company
expects to substantially complete all year 2000 conversion
projects by the end of fiscal 1998.
Seasonality
- -----------
The Company generally experiences higher sales levels in the
first and second quarters of the fiscal year in anticipation of
the holiday selling season.
<PAGE>
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The annual meeting of stockholders of the Company was held
on November 12, 1997 to elect two Class I directors and to
consider approval of the Company's Stock Plan for Directors. The
nominees for Class I directors and the votes for, and withheld
with respect to, each nominee are as follows:
<TABLE>
<CAPTION>
NOMINEE VOTES FOR VOTES WITHHELD
------- ---------- --------------
<S> <C> <C>
Richard D. Davidson 14,468,010 360,937
Ronald G. Stegall 14,547,465 281,482
</TABLE>
The votes for the Company's Stock Plan for Directors were as
follows:
FOR AGAINST ABSTAIN
--- ------- -------
14,502,255 179,275 147,417
ITEM 5. OTHER INFORMATION.
Forward Looking Statements
- --------------------------
Certain portions of this Report, and particularly the Notes
to the Consolidated Financial Statements and the Management's
Discussion and Analysis of Financial Condition and Results of
Operation in Part I of this report, contain forward-looking
statements. These statements can be identified by the use of
future tense or dates or terms such as "believe," "expect,"
"anticipate" or "plan." Important factors could cause results to
differ materially from those anticipated by some of the
statements made in this report. Some of the factors include,
among other things:
* changes from anticipated levels of sales of the
Company's products, whether due to future national or
regional economic and competitive conditions, customer
acceptance of existing and new products, or otherwise;
* pricing pressures due to excess capacity in the
ready-to-assemble furniture industry, as occurred in
1995, or customer demand in excess of the Company's
ability to supply product;
* raw material cost increases, particularly in particle
board and fiberboard, such as the increases that
reduced the Company's earnings in fiscal 1994 and 1995;
* transportation cost increases due to a shortage of
supply of trucks or railcars;
* the bankruptcy of a major customer, such as Best
Products Co., Inc. in 1996 and Montgomery Ward & Co. in
1997;
* loss of significant customers in connection with a
merger or acquisition or bankruptcy;
* actions of current or new competitors, such as
reduction of prices on competitive products or
introduction of new products competitive with the
Company's products;
* increased advertising costs associated with promotional
efforts;
* pending or new litigation;
and other uncertainties, all of which are difficult to predict
and many of which are beyond the control of the Company.
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits:
<TABLE>
<CAPTION>
Exhibit
No. Description
- -------- -----------
<S> <C>
3.1 & 4.1 Certificate of Incorporation of the Company
(incorporated by reference from Exhibit 3.1 to
Registration Statement on Form S-1 (File No. 33-72120))
3.2 & 4.2 Bylaws of the Company (incorporated by reference from
Exhibit 3.2 to Registration Statement on Form S-1 (File
No. 33-72120))
4.3 Specimen Stock Certificate of the Company (incorporated
by reference from Exhibit 4.1 to Amendment No. 3 to
Registration Statement on Form S-1 (File No. 33-72120))
4.4 Rights Agreement dated as of February 1, 1994 between
the Company and the First National Bank of Boston, as
Rights Agent (incorporated by reference from
Exhibit 4.4 to Quarterly Report on Form 10-Q for the
quarter ended March 31, 1994 (File No. 1-12754))
27 Financial Data Schedule
</TABLE>
(b) Reports on Form 8-K:
None
<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.
O'SULLIVAN INDUSTRIES HOLDINGS, INC.
Date: February 5, 1998 By: /s/ Daniel F. O'Sullivan
Chairman and
Chief Executive Officer
Date: February 5, 1998 By: /s/ Terry L. Crump
Executive Vice President
and Chief Financial Officer
(Principal Financial and
Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF O'SULLIVAN INDUSTRIES HOLDINGS, INC. FOR THE PERIOD
ENDED DECEMBER 31, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-01-1997
<PERIOD-END> DEC-31-1997
<CASH> 1,557
<SECURITIES> 0
<RECEIVABLES> 72,646
<ALLOWANCES> 1,437
<INVENTORY> 42,283
<CURRENT-ASSETS> 118,944
<PP&E> 135,387
<DEPRECIATION> 48,266
<TOTAL-ASSETS> 249,987
<CURRENT-LIABILITIES> 38,697
<BONDS> 38,000
0
0
<COMMON> 16,820
<OTHER-SE> 141,536
<TOTAL-LIABILITY-AND-EQUITY> 249,987
<SALES> 162,665
<TOTAL-REVENUES> 162,665
<CGS> 116,541
<TOTAL-COSTS> 116,541
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,112
<INCOME-PRETAX> 11,150
<INCOME-TAX> 4,123
<INCOME-CONTINUING> 7,027
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 7,027
<EPS-PRIMARY> 0.42
<EPS-DILUTED> 0.41
</TABLE>
