SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For The Quarterly Period Ended June 28, 1998
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 33-81808
BUILDING MATERIALS CORPORATION OF AMERICA
(Exact name of registrant as specified in its charter)
Delaware 22-3276290
(State of Incorporation) (I. R. S. Employer
Identification No.)
1361 Alps Road, Wayne, New Jersey 07470
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (973) 628-3000
(Not applicable)
(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 August 10, 1998, 1,015,010 shares of the Registrant's Class A common
stock and 15,000 shares of the Registrant's Class B common stock were
outstanding.
<PAGE>
Part I - FINANCIAL INFORMATION
Item 1 - FINANCIAL STATEMENTS
BUILDING MATERIALS CORPORATION OF AMERICA
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
Second Quarter Ended Six Months Ended
-------------------- ------------------
June 29, June 28, June 29, June 28,
1997 1998 1997 1998
-------- -------- -------- --------
(Thousands)
Net sales ............................ $255,934 $286,227 $449,258 $498,656
-------- -------- -------- --------
Costs and expenses:
Cost of products sold .............. 180,191 200,496 323,357 358,530
Selling, general and administrative. 50,810 59,017 91,676 107,383
-------- -------- -------- --------
Total costs and expenses.......... 231,001 259,513 415,033 465,913
-------- -------- -------- --------
Operating income ..................... 24,933 26,714 34,225 32,743
Interest expense ..................... (10,253) (12,713) (20,099) (25,405)
Other income, net..................... 1,934 4,086 5,360 14,353
-------- -------- -------- --------
Income before income taxes............ 16,614 18,087 19,486 21,691
Income taxes ......................... (6,481) (7,055) (7,600) (8,459)
-------- -------- -------- --------
Net income ........................... $ 10,133 $ 11,032 $ 11,886 $ 13,232
======== ======== ======== ========
See Notes to Consolidated Financial Statements
1
<PAGE>
BUILDING MATERIALS CORPORATION OF AMERICA
CONSOLIDATED BALANCE SHEETS
June 28,
December 31, 1998
1997 (Unaudited)
------------ -----------
(Thousands)
ASSETS
Current Assets:
Cash and cash equivalents..................... $ 12,921 $ 34,067
Investments in trading securities............. 62,059 1,132
Investments in available-for-sale securities.. 161,290 122,600
Investments in held-to-maturity securities.... 499 -
Other short-term investments.................. 19,488 21,438
Accounts receivable, trade, net............... 13,643 32,373
Accounts receivable, other.................... 50,839 57,913
Receivable from related parties, net.......... 5,151 -
Loan receivable from related party............ 6,152 -
Inventories................................... 72,254 117,544
Other current assets.......................... 6,243 8,671
--------- ---------
Total Current Assets........................ 410,539 395,738
Property, plant and equipment, net.............. 241,946 279,554
Goodwill, net................................... 70,046 80,752
Deferred income tax benefits.................... 35,981 33,366
Receivable from related parties ................ 31,661 -
Other assets.................................... 17,113 15,404
--------- ---------
Total Assets.................................... $ 807,286 $ 804,814
========= =========
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
Short-term debt............................... $ 26,944 $ 2,111
Current maturities of long-term debt.......... 3,801 4,183
Accounts payable.............................. 55,642 65,664
Payable to related parties, net............... - 9,175
Accrued liabilities........................... 26,298 47,768
Reserve for product warranty claims........... 13,100 13,100
--------- -------
Total Current Liabilities................... 125,785 142,001
--------- ---------
Long-term debt less current maturities.......... 555,446 534,843
--------- ---------
Reserve for product warranty claims............. 23,881 21,591
--------- ---------
Other liabilities............................... 19,175 19,132
--------- ---------
Stockholder's Equity:
Series A Cumulative Redeemable Convertible
Preferred Stock, $.01 par value per share;
100,000 shares authorized; no shares issued - -
Common stock, $.001 par value per share;
1,050,000 shares authorized;
1,000,010 shares issued and outstanding .... 1 1
Additional paid-in capital.................... 86,910 86,910
Accumulated deficit........................... (14,083) (851)
Accumulated other comprehensive income........ 10,171 1,187
--------- ---------
Stockholder's Equity ....................... 82,999 87,247
--------- ---------
Total Liabilities and Stockholder's Equity .... $ 807,286 $ 804,814
========= =========
See Notes to Consolidated Financial Statements
2
<PAGE>
BUILDING MATERIALS CORPORATION OF AMERICA
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Six Months Ended
--------------------
June 29, June 28,
1997 1998
--------- --------
(Thousands)
Cash and cash equivalents, beginning of period........... $124,560 $ 12,921
-------- --------
Cash provided by (used in) operating activities:
Net income............................................. 11,886 13,232
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation ...................................... 10,916 12,378
Goodwill amortization.............................. 920 1,002
Deferred income taxes.............................. 7,499 8,358
Noncash interest charges........................... 13,116 14,920
Increase in working capital items...................... (73,609) (43,931)
Purchases of trading securities........................ (39,750) (61,049)
Proceeds from sales of trading securities.............. 13,410 77,111
Change in net receivable from/payable to related
parties.............................................. (21,842) 45,987
Other, net............................................. (3,772) 2,867
-------- --------
Net cash provided by (used in) operating activities...... (81,226) 70,875
-------- --------
Cash provided by (used in) investing activities:
Capital expenditures................................... (15,066) (23,548)
Acquisitions........................................... (25,531) (43,468)
Purchases of available-for-sale securities............. (80,189) (32,808)
Purchases of held-to-maturity securities............... (4,591) -
Proceeds from sales of available-for-sale securities... 84,363 96,604
Proceeds from held-to-maturity securities.............. 7,917 499
-------- --------
Net cash used in investing activities.................... (33,097) (2,721)
-------- --------
Cash provided by (used in) financing activities:
Proceeds from sale of accounts receivable.............. 23,694 7,478
Increase (decrease) in short-term debt................. 538 (24,833)
Decrease in borrowings under revolving credit facility. - (34,000)
Repayments of long-term debt........................... (1,672) (1,629)
Decrease in loan receivable from related party......... - 6,152
Distribution to parent company......................... (18,000) -
Payments of asbestos claims............................ (3,062) -
Financing fees and expenses............................ (207) (176)
-------- --------
Net cash provided by (used in) financing activities...... 1,291 (47,008)
-------- --------
Net change in cash and cash equivalents.................. (113,032) 21,146
-------- --------
Cash and cash equivalents, end of period................. $ 11,528 $ 34,067
======== ========
See Notes to Consolidated Financial Statements
3
<PAGE>
BUILDING MATERIALS CORPORATION OF AMERICA
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - (Continued)
Six Months Ended
--------------------
June 29, June 28,
1997 1998
--------- ---------
(Thousands)
Supplemental Cash Flow Information:
Cash paid during the period for:
Interest (net of amount capitalized)............. $ 6,994 $ 10,279
Income taxes..................................... 138 800
Acquisition of Leatherback Industries business,
net of $8 cash acquired:
Fair market value of assets acquired............. $ 27,167
Purchase price of acquisition.................... 25,531
--------
Liabilities assumed.............................. $ 1,636
========
Acquisition of Leslie-Locke, Inc.:
Fair market value of assets acquired............... $ 59,318
Purchase price of acquisition...................... 43,468
--------
Liabilities assumed................................ $ 15,850
========
See Notes to Consolidated Financial Statements
4
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Building Materials Corporation of America (the "Company") is a wholly-
owned subsidiary of GAF Building Materials Corporation ("GAFBMC"), which is an
indirect, wholly-owned subsidiary of G-I Holdings Inc. ("G-I Holdings"). G-I
Holdings is a wholly-owned subsidiary of GAF Corporation ("GAF"). The
consolidated financial statements of the Company reflect, in the opinion of
management, all adjustments necessary to present fairly the financial position
of the Company at June 28, 1998, and the results of operations and cash flows
for the periods ended June 29, 1997 and June 28, 1998. All adjustments are of
a normal recurring nature. These financial statements should be read in
conjunction with the annual financial statements and notes thereto included in
the Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1997 (the "Form 10-K").
Note 1: Comprehensive Income
In June 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 130, "Reporting Comprehensive Income," which
is effective for fiscal years beginning after December 15, 1997.
Reclassification of financial statements for earlier periods is required. In
the Company's case, comprehensive income includes net income, unrealized gains
and losses from investments in available-for-sale securities, and pension
liability adjustments.
Second Quarter Ended Six Months Ended
-------------------- ------------------
June 29, June 28, June 29, June 28,
1997 1998 1997 1998
-------- -------- -------- --------
(Thousands)
Net income..............................$ 10,133 $ 11,032 $ 11,886 $ 13,232
-------- -------- -------- --------
Other comprehensive income, net of tax:
Unrealized gains on available-for-
sale securities:
Unrealized holding gains (losses)
arising during the period, net of
income tax (provision) benefit of
$(2,095), $378, $(3,765)
and $(1,471)........................ 3,277 (589) 5,890 2,305
Less: Reclassification adjustment
for gains included in net income,
net of income tax effect of $2,371
$ 2,913, $2,918, and $ 7,215........ (3,708) (4,559) (4,566) (11,289)
-------- -------- -------- --------
Total other comprehensive income (loss). (431) (5,148) 1,324 (8,984)
-------- -------- -------- --------
Comprehensive income....................$ 9,702 $ 5,884 $ 13,210 $ 4,248
======== ======== ======== ========
5
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Note 1. Comprehensive Income (Continued)
Changes in the components of "Accumulated other comprehensive income" for
the six months ended June 28, 1998 are as follows:
Unrealized
Gains on Minimum Accumulated
Available- Pension Other
for-sale Liability Comprehensive
Securities Adjustment Income
---------- ---------- -------------
(Thousands)
Balance, December 31, 1997.... $ 11,102 $ (931) $ 10,171
Change for the period......... (8,984) - (8,984)
-------- -------- --------
Balance, June 28, 1998........ $ 2,118 $ (931) $ 1,187
======== ======== ========
Note 2: Inventories:
Inventories consist of the following:
December 31, June 28,
1997 1998
------------ --------
(Thousands)
Finished goods..................... $ 38,459 $ 74,410
Work in process.................... 10,180 11,517
Raw materials and supplies......... 24,670 32,672
-------- --------
Total.............................. 73,309 118,599
Less LIFO reserve.................. (1,055) (1,055)
-------- --------
Inventories........................ $ 72,254 $117,544
======== ========
Note 3: Acquisition
Effective June 1, 1998, the Company purchased for approximately $43.5
million substantially all of the assets of Leslie-Locke Inc. ("Leslie-Locke"),
a wholly-owned subsidiary of Leslie Building Products, Inc., which manufactures
and markets a variety of specialty building products and accessories for the
professional and do-it-yourself remodeling and residential construction
industries from manufacturing facilities in Burgaw, North Carolina and Compton,
California. Leslie-Locke had 1997 sales of approximately $90 million. The
acquisition will be accounted for under the purchase method of accounting. The
results of Leslie-Locke are included from the date of acquisition and are not
material to the results presented in the foregoing financial statements. This
acquisition, if it had occurred on January 1, 1998, would not have had a
material impact on results of operations for the six months ended June 28,
1998.
6
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Note 4: Termination of Interest Rate Swap Agreements
In June 1998, the Company terminated interest rate swap agreements related
to its 11 3/4% Senior Deferred Coupon Notes due 2004 with an aggregate ending
notional principal amount of $60.0 million, resulting in gains of $0.7 million.
The gains have been deferred and will be amortized as a reduction of interest
expense over the remaining original life of the swaps.
Note 5: Contingencies
Asbestos Litigation Against GAF
In connection with its formation, the Company contractually assumed and
agreed to pay the first $204.4 million of liabilities for asbestos-related
bodily injury claims relating to the inhalation of asbestos fiber ("Asbestos
Claims") (whether for indemnity or defense) of its parent, GAFBMC, relating to
pending cases and previously settled, but not paid, cases as of January 31,
1994, and no other asbestos liabilities of GAFBMC. As of March 30, 1997, the
Company had paid all of its assumed asbestos-related liabilities.
GAF has advised the Company that, as of June 27, 1998, it is defending
approximately 113,000 pending alleged Asbestos Claims (having received notice
of approximately 55,900 new Asbestos Claims during the first six months of
1998) and has resolved approximately 256,700 Asbestos Claims (including
approximately 22,200 in the first six months of 1998). GAF has advised the
Company that it believes that a significant portion of the claims filed in the
first six months of 1998 were already pending against other defendants for some
period of time, with GAF being added as a defendant upon the lifting in 1997 of
the injunction relating to the Georgine class action settlement. During 1997,
GAF resolved approximately 11,000 Asbestos Claims of which approximately 9,900
were resolved (including Asbestos Claims disposed of at no cost to GAF) for an
average cost of approximately $4,070 per claim. GAF's share of the costs with
respect to approximately 1,100 Asbestos Claims resolved during 1997 has not yet
been determined. There can be no assurance that the actual costs of resolving
pending and future Asbestos Claims will approximate GAF's historic average
costs.
GAF has stated that it is committed to effecting a comprehensive
resolution of Asbestos Claims, that it is exploring a number of options, both
judicial and legislative, to accomplish such resolution, but there can be no
assurance that this effort will be successful.
The Company believes that it will not sustain any additional liability in
connection with asbestos-related claims. While the Company cannot predict
whether any asbestos-related claims will be asserted against it or its assets,
or the outcome of any litigation relating to such claims, it believes that it
has meritorious defenses to such claims. Moreover, it has been jointly and
severally indemnified by G-I Holdings and GAFBMC with respect to such claims.
7
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Note 5. Contingencies (Continued)
For further information regarding the history of the foregoing litigation
and asbestos-related matters, see "Item 3. Legal Proceedings" and Note 3 to
Consolidated Financial Statements contained in the Company's Form 10-K.
Environmental Litigation
The Company, together with other companies, is a party to a variety of
proceedings and lawsuits involving environmental matters ("Environmental
Claims"), in which recovery is sought for the cost of cleanup of contaminated
sites, a number of which Environmental Claims are in the early stages or have
been dormant for protracted periods. At most sites, the Company anticipates
that liability will be apportioned among the companies found to be responsible
for the presence of hazardous substances at the site. The Company believes
that the ultimate disposition of such matters will not, individually or in the
aggregate, have a material adverse effect on the business, liquidity, results
of operations, cash flows or financial position of the Company.
For further information regarding environmental matters and other
litigation, reference is made to "Item 3. Legal Proceedings" contained in the
Company's Form 10-K.
Tax Claim Against GAF
On September 15, 1997, GAF received a notice from the Internal Revenue
Service (the "Service") of a deficiency in the amount of $84.4 million (after
taking into account the use of net operating losses and foreign tax credits
otherwise available for use in later years) in connection with the formation in
1990 of Rhone-Poulenc Surfactants and Specialties, L.P. (the "surfactants
partnership"), a partnership in which a subsidiary of GAF, GAF Fiberglass
Corporation ("GFC"), holds an interest. The claim of the Service for interest
and penalties, after taking into account the effect on the use of net operating
losses and foreign tax credits, could result in GFC incurring liabilities
significantly in excess of the deferred tax liability of $131.4 million that
GAF recorded in 1990 in connection with this matter. GAF has advised the
Company that it believes that GFC will prevail in this matter, although there
can be no assurance in this regard. The Company believes that the ultimate
disposition of this matter will not have a material adverse effect on its
financial position or results of operations. GAF, G-I Holdings and certain
subsidiaries of GAF have agreed to jointly and severally indemnify the Company
against any tax liability associated with the surfactants partnership, which
the Company would be severally liable for, together with GAF and several
current and former subsidiaries of GAF, should GFC be unable to satisfy such
liability.
8
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Note 6. Subsequent Events
On July 15, 1998, the Company recorded a nonrecurring charge of $7.6
million related to a grant to an executive officer of 30,000 shares of
restricted common stock of the Company and certain cash payments to be made to
such officer over a specified time period.
On July 17, 1998, the Company issued $150 million in aggregate principal
amount at maturity of 7 3/4% Senior Notes due 2005. As of August 11, 1998, the
Company had used a portion of the net proceeds from this issue to purchase (and
subsequently cancel), $132.6 million in aggregate principal amount at maturity
of the Company's 11 3/4% Senior Deferred Coupon Notes due 2004. In connection
with this purchase, the Company recorded an extraordinary loss of $9.3 million
in July 1998.
9
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Results of Operations - Second Quarter 1998 Compared With
Second Quarter 1997
The Company recorded second quarter 1998 net income of $11.0 million
compared with $10.1 million in the second quarter of 1997. The 8.9% increase
in net income reflected higher operating and other income, partially offset by
increased interest expense.
The Company's net sales for the second quarter of 1998 were $286.2
million, an 11.8% increase over last year's sales of $255.9 million. The net
sales gains occurred in both the residential and commercial product lines. The
increase in residential net sales reflected both higher unit volumes and higher
average selling prices, while the increase in net sales of commercial roofing
products was primarily from higher unit volumes.
Operating income for the second quarter of 1998 was $26.7 million compared
with $24.9 million in the second quarter of 1997. The 7.2% improvement in
operating income was achieved due to an improved gross margin offset by higher
distribution costs, primarily due to rail carrier service problems in certain
regions of the country requiring the use of higher-cost transportation
alternatives and by increased selling and administrative expenses related to
expanded marketing efforts. Selling, general and administrative expenses
increased by 16.1% to $59.0 million compared with last year's $50.8 million.
Interest expense increased to $12.7 million in the second quarter of 1998
from $10.3 million last year due to higher debt levels, mainly reflecting the
issuance in October 1997 of $100 million in aggregate principal amount at
maturity of 8% Senior Notes due 2007. Other income, net, was $4.1 million for
the second quarter compared with $1.9 million last year, reflecting higher
investment income and lower other expenses, principally legal expenses from
certain litigation in the prior year.
Results of Operations - Six Months 1998 Compared With
Six Months 1997
For the first six months of 1998, the Company recorded net income of $13.2
million compared with $11.9 million for the first six months of 1997. The
10.9% increase in net income resulted from higher investment income, partially
offset by lower operating income and higher interest expense.
The Company's net sales for the first six months of 1998 were $498.7
million, an 11.0% increase over last year's sales of $449.3 million. The net
sales growth occurred in both the residential and commercial product lines and
resulted primarily from higher unit sales volumes.
10
<PAGE>
Operating income for the first six months of 1998 was $32.7 million
compared with $34.2 million in the first six months of 1997. The decline in
operating income was attributable to higher distribution costs due to rail
service problems and higher selling and administrative expenses resulting from
broader marketing efforts, partially offset by the impact of higher product
sales and lower manufacturing costs. Selling, general and administrative
expenses increased by 17.1% to $107.4 million compared with last year's $91.7
million.
Interest expense increased to $25.4 million in the first six months of
1998 from $20.1 million last year due to higher debt levels, mainly reflecting
the issuance in October 1997 of $100 million in aggregate principal amount at
maturity of 8% Senior Notes due 2007. Other income, net, was $14.4 million
compared with $5.4 million last year, principally reflecting higher investment
income.
Liquidity and Financial Condition
Net cash inflow during the first six months of 1998 was $68.2 million
before financing activities, and included $70.9 million of cash generated from
operations, the reinvestment of $23.5 million for capital programs, the
acquisition of Leslie-Locke, Inc. for $43.5 million (see Note 3 to Consolidated
Financial Statements), and the generation of $64.3 million from net sales of
available-for-sale and held-to-maturity securities.
Cash invested in additional working capital totaled $43.9 million during
the first six months of 1998, primarily reflecting a seasonal increase in
inventories of $31.9 million and a $26.8 million increase in receivables,
partially offset by a $16.6 million increase in accounts payable and accrued
liabilities. Accrued liabilities increased by $21.5 million to $47.8 million
as a result of additional accrued interest payable and seasonal increases in
accrued distribution costs and other plant operating accruals. Cash from
operating activities also reflected a $46.0 million cash inflow as a result of
repayments of advances by GAF, G-I Holdings and their subsidiaries which were
made by the Company in 1997, and a $16.1 million cash inflow from net sales of
trading securities.
Net cash used in financing activities totaled $47.0 million during the
first six months of 1998, mainly reflecting a $34.0 million paydown of
borrowings under the Company's bank revolving credit facility and a $24.8
million decrease in short-term borrowings, partially offset by a $6.2 million
cash inflow from the repayment of a loan by a related party and $7.5 million
proceeds from the sale of receivables.
As a result of the foregoing factors, cash and cash equivalents increased
by $21.1 million during the first six months of 1998 to $34.1 million
(excluding $145.2 million of trading and available-for-sale securities and
other short-term investments).
In June 1998, the Company terminated interest rate swap agreements related
to its 11 3/4% Senior Deferred Coupon Notes due 2004 with an aggregate ending
notional principal amount of $60.0 million, resulting in gains of $0.7 million.
The gains have been deferred and will be amortized as a reduction of interest
expense over the remaining original life of the swaps.
11
<PAGE>
On July 17, 1998, the Company issued $150 million in aggregate principal
amount at maturity of 7 3/4% Senior Notes due 2005. The Company used a portion
of the net proceeds from this issue to purchase (and subsequently cancel)
$132.6 million in aggregate principal amount at maturity of the Company's
11 3/4% Senior Deferred Coupon Notes due 2004 ("Deferred Coupon Notes") and
intends to use the remaining net proceeds from this issue to purchase (and
subsequently cancel) up to an additional $17.4 million in aggregate principal
amount at maturity of such Deferred Coupon Notes. If the Company purchases
(and subsequently cancels) an aggregate of $150 million in aggregate principal
amount at maturity of such Deferred Coupon Notes, the Company would record a
total extraordinary loss of approximately $10 million. See Note 6 to
Consolidated Financial Statements.
The Company has significantly upgraded its information systems
capabilities and is in the process of finalizing the roll-out of an interactive
network connecting all of its locations. In conjunction with this initiative,
the Company is addressing its "Year 2000" compliance issues and does not
believe that the costs associated with, or the impact of, these issues will
have a material adverse effect on the operations, liquidity or capital
resources of the Company. At this time, the Company is in the process of
reviewing the Year 2000 compliance of its major suppliers and customers.
From time to time, the Company reviews the reserves established for
estimated probable future warranty claims. The Company is currently
undertaking a review of these reserves and, before the end of the fiscal year,
could increase reserves relating to its residential roofing products by
approximately $6 million to $12 million on an after tax basis.
See Notes 5 and 6 to Consolidated Financial Statements for information
regarding contingencies and subsequent events.
Forward-looking Statements
This Form 10-Q may contain certain "forward-looking statements" intended
to qualify for the safe harbor from liability established by the Private
Securities Litigation Reform Act of 1995. These forward-looking statements
generally can be identified by use of statements that include phrases such as
the Company or its management "believes," "expects," "anticipates," "intends,"
"plans," "foresees" or other words or phrases of similar import. Similarly,
statements that describe the Company's objectives, plans or goals also are
forward-looking statements. All such forward-looking statements are subject to
certain risks and uncertainties that could cause actual results to differ
materially from those contemplated by the relevant forward-looking statement.
Investors and other readers are urged to consider these factors carefully in
evaluating the forward-looking statements. The forward-looking statements
included herein are made only as of the date of this Form 10-Q and the Company
undertakes no obligation to publicly update such forward-looking statements to
reflect subsequent events or circumstances.
12
<PAGE>
PART II
OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27 - Financial Data Schedule, which is submitted electronically to the
Securities and Exchange Commission for information only.
(b) No Reports on Form 8-K were filed during the quarter ended
June 28, 1998.
13
<PAGE>
SIGNATURES
-----------
Pursuant to the requirements of Section 13 or 15(d) 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.
BUILDING MATERIALS CORPORATION OF AMERICA
DATE: August 7, 1998 BY: /s/William C. Lang
-------------- ------------------
William C. Lang
Senior Vice President and
Chief Financial Officer
(Principal Financial and Accounting Officer)
14
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE SECOND
QUARTER 1998 10-Q OF BUILDING MATERIALS CORPORATION OF AMERICA AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1998
<PERIOD-END> JUN-28-1998
<CASH> 34,067
<SECURITIES> 123,732
<RECEIVABLES> 32,373
<ALLOWANCES> 0
<INVENTORY> 117,544
<CURRENT-ASSETS> 395,738
<PP&E> 279,554
<DEPRECIATION> 0
<TOTAL-ASSETS> 804,814
<CURRENT-LIABILITIES> 142,001
<BONDS> 534,843
0
0
<COMMON> 1
<OTHER-SE> 87,246
<TOTAL-LIABILITY-AND-EQUITY> 804,814
<SALES> 498,656
<TOTAL-REVENUES> 498,656
<CGS> 358,530
<TOTAL-COSTS> 358,530
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 25,405
<INCOME-PRETAX> 21,691
<INCOME-TAX> 8,459
<INCOME-CONTINUING> 13,232
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<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 13,232
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
