SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
[x] THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 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: 033-78954
SCOTSMAN HOLDINGS, INC.
(Exact name of Registrant as specified in its Charter)
Delaware 52-1862719
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
8211 Town Center Drive 21236
Baltimore, Maryland (Zip Code)
(Address of principal executive offices)
(410) 931-6000
(Registrant's telephone number, including area code)
None
(Former name, former address and former fiscal year - if changed since last
report)
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 June 30, 1999, 6,196,674 shares of common stock ("Common Stock") of
the Registrant were outstanding.
<PAGE>
SCOTSMAN HOLDINGS, INC.
INDEX
FORM 10-Q
PART I - FINANCIAL INFORMATION Page
----
Item 1. Financial Statements
Consolidated Balance Sheets at June 30, 1999 1
and December 31, 1998
Consolidated Statements of Operations for the three
and six months ended June 30, 1999 and 1998 2
Consolidated Statements of Cash Flows for the six 3
months ended June 30, 1999 and 1998
Notes to Consolidated Financial Statements 5
Item 2. Management's Discussion and Analysis of 8
Financial Condition and Results of Operations
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 13
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
SCOTSMAN HOLDINGS, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
June 30,
1999 December 31,
Assets (Unaudited) 1998
------ ----------- ------------
(dollars in thousands)
Cash $ 746 $ 800
Trade accounts receivable, less allowance for
doubtful accounts 47,747 39,244
Prepaid expenses and other current assets 16,682 13,976
Rental equipment, net of accumulated depreciation of
$114,574 in 1999 and $102,614 in 1998 695,265 640,634
Property and equipment, net 52,914 46,679
Deferred financing costs, net 22,752 25,161
Goodwill and other intangible assets, net 174,770 159,817
Other assets 16,459 14,980
---------- ---------
$1,027,335 $ 941,291
========== =========
Liabilities and Stockholders' Equity
------------------------------------
Accounts payable $ 19,042 $ 12,651
Accrued expenses 27,999 26,220
Rents billed in advance 22,748 21,702
Long-term debt 901,021 845,447
Deferred income taxes 107,263 93,124
---------- ---------
Total liabilities 1,078,073 999,144
---------- ---------
Stockholders' equity:
Common stock, $.01 par value. Authorized 10,000,000
shares; issued 9,507,407 shares 95 95
Additional paid-in capital 232,529 231,826
Retained earnings 12,494 6,082
---------- ---------
245,118 238,003
Less treasury stock, at cost - 3,310,733 common shares (295,856) (295,856)
---------- ---------
Net stockholders' deficit (50,738) (57,853)
---------- ---------
$1,027,335 $ 941,291
========== =========
See accompanying notes to consolidated financial statements.
1
<PAGE>
SCOTSMAN HOLDINGS, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
------------------ ----------------
1999 1998 1999 1998
------ ----- ---- ----
(in thousands except share and per share amounts)
<S><C>
Revenues:
Leasing $50,022 $33,373 $ 97,597 $65,234
Sales:
New units 16,186 9,571 31,209 18,741
Rental equipment 6,475 3,832 11,531 7,278
Delivery and installation 15,895 10,941 29,555 18,838
Other 10,172 5,864 17,452 11,643
------- ------- -------- -------
Total revenues 98,750 63,581 187,344 121,734
------- ------- -------- -------
Costs of sales and services:
Leasing:
Depreciation and amortization 8,397 6,133 16,997 12,046
Other direct leasing costs 7,395 4,932 13,939 9,686
Sales:
New units 13,286 7,748 25,534 15,250
Rental equipment 4,995 2,887 8,780 5,353
Delivery and installation 11,302 7,551 21,267 13,414
Other 2,904 1,076 4,015 2,354
------- ------- -------- -------
Total costs of sales and services 48,279 30,327 90,532 58,103
------- ------- -------- -------
Gross profit 50,471 33,254 96,812 63,631
------- ------- -------- -------
Selling, general and administrative expenses 17,666 12,898 35,943 26,532
Other depreciation and amortization 4,012 1,894 7,744 3,433
Interest, including amortization of deferred
financing costs 20,475 14,363 40,749 28,420
------- ------- -------- -------
Total operating expenses 42,153 29,155 84,436 58,385
------- ------- -------- -------
Income before income taxes 8,318 4,099 12,376 5,246
Income tax expense 3,896 1,581 5,939 2,039
------- ------- -------- -------
Net Income $ 4,422 $ 2,518 $ 6,437 $ 3,207
======= ======= ======== =======
Earnings per common share $ 0.71 $ 0.51 $ 1.04 $ 0.65
======= ======= ======== =======
Earnings per common share, assuming dilution $ 0.68 $ 0.49 $ 0.98 $ 0.62
======= ======= ======== =======
</TABLE>
See accompanying notes to consolidated financial statements.
2
<PAGE>
SCOTSMAN HOLDINGS, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
Six months ended June 30, 1999 and 1998
(Unaudited)
1999 1998
--------- --------
(dollars in thousands)
Cash flows from operating activities:
Net income $ 6,437 $ 3,207
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 27,196 17,161
Provision for bad debts 1,904 1,203
Deferred income tax expense 5,494 1,964
Non-cash option compensation expense 703 ---
Gain on sale of rental equipment (2,751) (1,925)
Increase in net trade accounts receivable (7,892) (7,137)
Decrease in other assets 132 1,372
Increase in accrued expenses 1,779 1,285
Other 1,775 7,562
--------- --------
Net cash provided by operating activities 34,777 24,692
--------- --------
Cash flows from investing activities:
Rental equipment additions (56,428) (65,048)
Proceeds from sales of rental equipment 11,531 7,278
Purchases of property and equipment, net (8,462) (6,741)
Purchase of Evergreen Mobile Company, net
of cash acquired (37,000) ---
--------- --------
Net cash used in investing activities $ (90,359) $(64,511)
--------- --------
(continued)
3
<PAGE>
SCOTSMAN HOLDINGS, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (continued)
(Unaudited)
1999 1998
--------- --------
(dollars in thousands)
Cash flows from financing activities:
Repayment of promissory note payable $ --- $ (21,834)
Proceeds from long-term debt 247,232 186,230
Repayment of long-term debt (191,658) (124,122)
Increase in deferred financing costs (46) (315)
Payments to acquire treasury stock --- (55)
--------- --------
Net cash provided by financing activities 55,528 39,904
--------- --------
Net (decrease) increase in cash (54) 85
Cash at beginning of period 800 296
--------- --------
Cash at end of period $ 746 $ 381
========= ========
Supplemental cash flow information:
Cash paid for income taxes $ 175 $ 85
========= ========
Cash paid for interest $ 38,066 $ 26,558
========= ========
See accompanying notes to consolidated financial statements.
4
<PAGE>
SCOTSMAN HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(Unaudited)
(Dollars in thousands, except share amounts)
(1) ORGANIZATION AND BASIS OF PRESENTATION
Scotsman Holdings, Inc. ("Holdings") was organized in November, 1993 for
the purpose of acquiring Williams Scotsman, Inc. ("Scotsman"). Holdings and
Scotsman are collectively referred to as the "Company." The Company
conducts business solely as a holding company, the only significant asset
of which is the capital stock of Scotsman. Therefore, any cash dividends to
be paid on the Company's common stock, or cash interest to be paid on notes
of the Company, are dependent upon the cash flow of Scotsman.
(2) FINANCIAL STATEMENTS
The financial information for the six months ended June 30, 1999 and 1998
has not been audited. In the opinion of management, the unaudited financial
statements contain all adjustments (consisting only of normal, recurring
adjustments) necessary to present fairly the Company's financial position
as of June 30,1999 and its operating results and cash flows for the six
month periods ended June 30, 1999 and 1998. The results of operations for
the periods ended June 30, 1999 and 1998 are not necessarily indicative of
the operating results for the full year.
Certain information and footnote disclosure normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been omitted. It is suggested that these financial
statements be read in conjunction with the financial statements and notes
thereto included in the Company's latest Form 10-K.
(3) ACQUISITION
On February 1, 1999, Scotsman acquired all of the outstanding stock of
Evergreen Mobile Company, a privately held Washington corporation ("EVG"),
in a transaction accounted for under the purchase method of accounting.
Total consideration for the acquisition of EVG was approximately $37,000,
including the repayment of existing indebtedness of EVG. The purchase price
paid was allocated to the net assets acquired of approximately $19,000 with
the excess representing goodwill and other intangible assets. The purchase
price allocation was based upon estimates of the fair value of the net
assets acquired. These estimates may vary from actual amounts ultimately
recorded. The acquisition was financed with borrowings under Scotsman's
amended credit facility.
5
<PAGE>
SCOTSMAN HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
(4) GOODWILL AND OTHER INTANGIBLE ASSETS
The excess of cost over fair values of net assets acquired in purchase
transactions has been recorded as goodwill and is being amortized on a
straight line basis over 20 to 40 years. Other identifiable intangibles
acquired include assembled workforce and covenants not to compete, which
are being amortized on a straight line basis over periods of 21 to 86
months. As of June 30, 1999 and 1998, accumulated amortization was $4,389
and $246, respectively.
On a periodic basis, the Company evaluates the carrying value of its
intangible assets to determine if the facts and circumstances suggest that
intangible assets may be impaired. If this review indicates that intangible
assets may not be recoverable, as determined by the undiscounted cash flow
of the entity acquired over the remaining amortization period, the
Company's carrying value of intangible assets is reduced by the estimated
shortfall of cash flows.
(5) EARNINGS PER SHARE
Earnings per common share is computed by dividing net earnings by the
weighted average number of common shares outstanding during the periods.
The following table sets forth the components of the weighted-average
shares outstanding for the basic and diluted earnings per share
computations:
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
------------------ ----------------
1999 1998 1999 1998
------ ------ ------ ------
<S><C>
Weighted-average shares - basic earnings
per share 6,196,674 4,919,186 6,196,674 4,919,658
Effect of employee stock options 349,375 227,476 353,017 228,196
--------- --------- --------- ---------
Weighted-average shares - diluted earnings
per share 6,546,049 5,146,662 6,549,691 5,147,854
========= ========= ========= =========
</TABLE>
6
<PAGE>
SCOTSMAN HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (continued)
(6) INCOME TAXES
The difference between the Company's reported tax provision for the three
and six months ended June 30, 1999 and the tax provision computed based on
U.S. statutory rates is primarily attributed to non-deductible goodwill
amortization expense of $1,437 and $2,639, respectively.
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
FORWARD LOOKING STATEMENTS
Certain statements in this Form 10-Q for the quarter ended June 30,1999
constitute "forward-looking statements" within the meaning of Section 27Aof the
Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause actual results to differ materially from future
results expressed or implied by such forward-looking statements. Such factors
include, among others, the following: substantial leverage and the ability to
service debt; changing market trends in the mobile office industry; general
economic and business conditions including a prolonged or substantial recession;
the ability to finance fleet and branch expansion, to locate and finance
acquisitions, and to integrate recently acquired businesses into the Company;
the ability of the Company to implement its business and growth strategy and
maintain and enhance its competitive strengths; the ability of the Company to
obtain financing for general corporate purposes; intense industry competition;
availability of key personnel; industry over-capacity; risks associated with the
"Year 2000" phenomenon; and changes in, or the failure to comply with,
government regulations. No assurance can be given as to future results and
neither the Company nor any other person assumes responsibility for the accuracy
and completeness of these forward-looking statements. Consequently, undue
reliance should not be placed on such forward-looking statements, which speak
only as of the date hereof. The Company undertakes no obligation to publicly
release the result of any revision to these forward-looking statements that
maybe made to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.
RESULTS OF OPERATIONS
The results of operations for the three and six month periods ended June
30, 1999 include the effect of three acquisitions completed during the 12-month
period then ended. These acquisitions added a total of approximately 17,500
units.
Three Months Ended June 30, 1999 Compared with Three Months Ended June 30,
1998.
Revenues in the quarter ended June 30, 1999 were $98.8 million, a $35.2
million or 55.3% increase from revenues of $63.6 million in the same period of
1998. The increase resulted from a $16.6 million or 49.9% increase in leasing
revenue, a $6.6 million or 69.1% increase in new unit sales revenue, a $5.0 or
45.3% increase in delivery and installation revenue, a $2.6 million or 69.0%
increase in revenue from sale of used units and a $4.3 million or 73.5% increase
in other revenue. The increase in leasing revenue is attributable to a 45.8%
increase in the average lease fleet to approximately 74,200 units at June 30,
1999, combined with an increase of $3 in the average monthly rental rate and
stable average fleet utilization of 85%. The increase in new and used sales
revenue is primarily due to the effect of the acquisitions noted above and the
overall branch expansion that the Company has experienced over the last several
8
<PAGE>
years. The increase in delivery and installation revenue is attributable to the
increases in the leasing and sale revenue described above. Other revenue
increased as a result of increases in the rental of steps, ramps and furniture,
and relocation services provided for customer-owned units.
Gross profit for the quarter ended June 30, 1999 was $50.5 million, a
$17.2 million or 51.8% increase from the second quarter of 1998 gross profit of
$33.3 million. This increase is primarily a result of an increase in leasing
gross profit of $11.9 million or 53.4% and an increase in the gross profit from
other revenue of $2.5 million or 51.8%. The increase in leasing gross profit is
a result of the increase in leasing revenue described above combined with an
increase in leasing margins from 66.8% in 1998 to 68.4% in 1999. Excluding
depreciation and amortization, leasing margins remained unchanged at 85.2%. The
increase in gross profit from other revenue is primarily related to the increase
in revenue noted above.
Selling, general and administrative ("SG&A") expenses increased by $4.8
million or 37.0% from 1998. This increase is the result of the growth
experienced by the Company both in terms of fleet size and number of branches as
compared to 1998. In addition to the effect of acquisitions on the fleet size as
noted above, the Company's branch network has expanded from 76 branches at June
30, 1998 to 83 branches at June 30, 1999. The overall increases in SG&A are due
to increases in field related expenses, primarily payroll and occupancy,
incurred in connection with this branch expansion and fleet growth.
Other depreciation and amortization increased by $2.1 million to $4.0
million for the quarter ended June 30, 1999 from the same period of 1998. Of
this increase, $1.4 million relates to the amortization of goodwill and other
intangible assets recorded in connection with acquisitions. The remaining
increase relates to depreciation on increased balances of property and equipment
and inventories of steps and ramps associated with the overall growth of the
Company's branch network and fleet as discussed above.
Interest expense increased by $6.1 million or 42.6% to $20.5 million in
1999 from $14.4 million in 1998. This increase is the result of increased
borrowings to finance acquisitions and other fleet and branch growth.
Six Months Ended June 30, 1999 Compared with Six Months Ended June 30,
1998.
Revenues in the six months ended June 30, 1999 were $187.3 million, a
$65.6 million or 53.9% increase from revenues of $121.7 million in the same
period of 1998. The increase resulted from a $32.4 million or 49.6% increase in
leasing revenue, a $12.5 million or 66.5% increase in new unit sales revenue, a
$10.7 or 56.9% increase in delivery and installation revenue, a $4.3 million or
58.4% increase in revenue from sale of used units and a $5.8 million or 49.9%
increase in other revenue. The increase in leasing revenue is attributable to a
47.9% increase in the average lease fleet to approximately 73,100 units for the
six months ended June 30, 1999, combined with an increase of $3 in the average
monthly rental rate and a decrease of one percentage point in average fleet
utilization to 85%. The increase in new and used sales revenue is primarily due
to the effect of the acquisitions noted above and the overall branch expansion
that the Company has experienced over the last several years. The increase in
delivery and installation revenue is attributable to the increases in the
leasing and sale revenue described
9
<PAGE>
above. Other revenue increased as a result of increases in the rental of steps,
ramps and furniture. Additionally, revenue associated with a large project to
relocate customer-owned units was recognized during the period ended June 30,
1999.
Gross profit for the six months ended June 30, 1999 was $96.8 million, a
$33.2 million or 52.1% increase from 1998 gross profit of $63.6 million. This
increase is primarily a result of an increase in leasing gross profit of $23.2
million or 53.2%, an increase in gross profit from new sales of $2.2 million or
62.6%, an increase in delivery and installation gross profit of $2.9 million or
52.8% and an increase in the gross profit from other revenue of $4.1 million or
44.7%. The increase in leasing gross profit is a result of the increase in
leasing revenue described above combined with an increase in leasing margins
from 66.7% in 1998 to 68.3% in 1999. Excluding depreciation and amortization,
leasing margins increased slightly from 85.2% in 1998 to 85.7% in 1999. The
increases in gross profit from new sales and delivery and installation are
primarily due to the increases in revenue as discussed above. The increase in
gross profit from other revenue is primarily related to the overall revenue
increases noted above.
SG&A expenses increased by $9.4 million or 35.5% from 1998. This increase
is the result of the growth experienced by the Company both in terms of fleet
size and number of branches as compared to 1998. In addition to the effect of
acquisitions on the fleet size as noted above, the Company's branch network has
expanded from 76 branches at June 30, 1998 to 83 branches at June 30, 1999. The
overall increases in SG&A are due to increases in field related expenses,
primarily payroll and occupancy, incurred in connection with this branch
expansion and fleet growth.
Other depreciation and amortization increased by $4.3 million to $7.7
million for the six months ended June 30, 1999 from the same period of 1998. Of
this increase, $2.6 million relates to the amortization of goodwill and other
intangible assets recorded in connection with acquisitions. The remaining
increase relates to depreciation on increased balances of property and equipment
and inventories of steps and ramps associated with the overall growth of the
Company's branch network and fleet as discussed above.
Interest expense increased by $12.3 million or 43.4% to $40.7 million in
1999 from $28.4 million in 1998. This increase is the result of increased
borrowings to finance acquisitions and other fleet and branch growth.
LIQUIDITY AND CAPITAL RESOURCES
During the six months ended June 30, 1999 and 1998, the Company's principal
sources of funds consisted of cash flow from operating and financing sources.
Cash flow from operating activities of $34.8 million and $24.7 million for the
six months ended June 30, 1999 and 1998, respectively, was largely generated by
the rental of units from the Company's lease fleet and sales of new mobile
office units.
The Company has increased its EBITDA and believes that EBITDA provides the
best indication of its financial performance and provides the best measure of
its ability to meet historical debt service requirements. The Company defines
EBITDA as net income before interest, taxes, depreciation, amortization and
non-cash compensation expense. EBITDA as defined by the Company does not
represent cash flow from operations as defined by generally
10
<PAGE>
accepted accounting principles and should not be considered as an alternative to
cash flows as a measure of liquidity, nor should it be considered as an
alternative to net income as an indicator of the Company's operating
performance. The Company's EBITDA increased by $29.5 million or 59.9% to $78.6
million for the first half of 1999 compared to $49.1 million for the same period
of 1998. This increase in EBITDA is a result of increased leasing activity
resulting from the overall increases in the number of units in the fleet, stable
utilization and an increase in the average monthly rental rate, offset by
increased SG&A expenses required to support the increased activities during the
first half of 1999.
Cash flow used in investing activities was $90.4 million and $64.5 million in
the six months ended June 30, 1999 and 1998, respectively. The Company's primary
capital expenditures are for the discretionary purchase of new units for the
lease fleet and units purchased through acquisitions. The Company seeks to
maintain its lease fleet in good condition at all times and generally increases
the size of its lease fleet only in those local or regional markets experiencing
economic growth and established unit demand. Cash provided by financing
activities of $55.5 million and $39.9 million in the six months ended June 30,
1999 and 1998, respectively, was primarily from borrowings under the line of
credit. In 1998, Scotsman paid dividends to the Company primarily to effect the
repayment of a promissory note in the amount of $21,834.
The Company believes it will have, for the next 12 months, sufficient
liquidity under its revolving line of credit and from cash generated from
operations to meet its expected obligations as they arise.
IMPACT OF THE YEAR 2000
The Company has developed a comprehensive Year 2000 Compliance Plan designed
to ensure that all of its significant or "mission critical" computer systems
will function properly with respect to dates in the year 2000 and beyond. To
date, the Company has completed all phases of its plan, including the
assessment, remediation, testing and implementation of its key business computer
applications affected by the Year 2000 issue. During the past three years, the
Company has upgraded and/or replaced certain computer hardware and software
systems that are significant to its business operations. Such systems have been
determined to be Year 2000 compliant. Modification and testing of software
applications has been completed and the software is currently operational. Many
of these system replacements/upgrades were a part of the Company's business
expansion and technology initiatives and were not undertaken in response to
Year2000 issues. Additionally, the Company has surveyed its significant
suppliers, large customers and financial institutions to ensure that those
parties have appropriate plans to remediate Year 2000 issues where their systems
interface with the Company's systems or otherwise impact its operations. To
date, the Company is not aware of any such third party with a Year 2000 issue
that would materially impact the Company's results of operations, liquidity or
capital resources. Lastly, the Company's products and services are not directly
impacted by the Year 2000 issue as there are no computer processors or embedded
systems in our products that make use of century date logic. While the Company
believes its planning efforts are adequate to address its Year 2000 concerns,
there can be no guarantee that the systems of other companies on which the
Company's systems and operations rely will be converted on a timely basis and
will not have a material effect on the Company. However, due to the geographic
diversity of the Company's 83 branch offices and the regionalized nature of
manufacturers and other vendors servicing the branch network, the likelihood of
Year 2000 failures having a material impact on
11
<PAGE>
the conduct of our daily business operations is not significant. Total costs
related to Year 2000 initiatives are insignificant to the Company's results of
operations or financial position. The Company has prepared a contingency plan
for all mission critical computer applications that could be impacted by the
Year 2000 issue. The contingency plan involves manual workarounds, use of
alternate vendors and manufacturers and adjusting staffing strategies.
12
<PAGE>
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits.
None
(b) Reports on Form 8-K.
None
13
<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.
SCOTSMAN HOLDINGS, INC.
By: /s/ Gerard E. Keefe
---------------------------------
Gerard E. Keefe
Senior Vice President and
Chief Financial Officer
Dated: August 13, 1999
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Name Capacity Date
---- -------- ----
/s/ Gerard E. Keefe Senior Vice President and August 13, 1999
- ----------------------------- Chief Financial Officer
Gerard E. Keefe
/s/ Katherine K. Giannelli Vice President and Controller August 13, 1999
- -----------------------------
Katherine K. Giannelli
14
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 746
<SECURITIES> 0
<RECEIVABLES> 49,271
<ALLOWANCES> 1,524
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 875,512
<DEPRECIATION> 127,333
<TOTAL-ASSETS> 1,027,335
<CURRENT-LIABILITIES> 0
<BONDS> 901,021
0
0
<COMMON> 95
<OTHER-SE> (50,833)
<TOTAL-LIABILITY-AND-EQUITY> 1,027,335
<SALES> 187,344
<TOTAL-REVENUES> 187,344
<CGS> 90,532
<TOTAL-COSTS> 90,532
<OTHER-EXPENSES> 43,687
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 40,749
<INCOME-PRETAX> 12,376
<INCOME-TAX> 5,939
<INCOME-CONTINUING> 6,437
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,437
<EPS-BASIC> 1.04
<EPS-DILUTED> 0.98
</TABLE>
