<PAGE> 1
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 September 30, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d ) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number 33-87404
PRIMECO INC.
Texas 74-1951774
- ---------------------------------- -----------------
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
16225 Park Ten Place, Suite 200
Houston, Texas 77084
----------------------------------------
(Address of principal executive offices)
(713) 578-5600
----------------------------------------------------
(Registrant's telephone number, including area code)
Indicate by check mark whether Registrant (1) has filed all reports 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
----- -----
<PAGE> 2
PRIMECO INC.
Part I. Financial Information Page
Item 1. Financial Statements:
Condensed Consolidated Balance Sheets
September 30, 1995 and December 31, 1994 2
Condensed Consolidated Statements of Operations
For the three month and nine month periods
ended September 30, 1995 and 1994 3
Condensed Consolidated Statements of Cash Flows
For the nine months ended September 30, 1995 and 1994 4
Notes to Condensed Consolidated Financial Statements 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
Part II. Other Information
Item 5. Other Information
Issuance of Senior Subordinated Debt 12
Signatures 13
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<PAGE> 3
PRIMECO INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands Except for Share Amounts)
<TABLE>
<CAPTION>
September 30 December 31
1995 1994
------------ -----------
<S> <C> <C>
ASSETS
Cash and cash equivalents.................... $ 2,755 $ 12,090
Accounts receivable, net..................... 34,210 30,175
Inventories.................................. 18,487 13,187
Rental equipment, net........................ 175,756 153,818
Property, plant and equipment, net........... 22,102 20,768
Cost in excess of fair value of net assets
acquired, net.............................. 115,823 117,713
Other assets................................. 23,161 21,009
-------- --------
Total assets.......................... $392,294 $368,760
======== ========
LIABILITIES AND SHAREHOLDER'S EQUITY
Accounts payable............................. $ 10,857 $ 12,122
Accrued expenses............................. 22,995 23,465
Debt......................................... 255,500 225,000
Deferred income taxes........................ 25,890 27,594
Other liabilities............................ 2,392 1,974
Redeemable convertible preferred stock
$.01 par value, $2,000 per share
liquidation value, 5,000 shares
authorized and outstanding................. 9,481 8,975
Common shareholder's equity:
Common stock, $.01 par value, 10,000 shares
authorized and 5,000 shares outstanding.. 1 1
Paid-in capital............................. 68,731 69,874
Accumulated deficit.......................... (3,553) (245)
-------- --------
Common shareholder's equity................ 65,179 69,630
-------- --------
Total liabilities and shareholder's equity. $392,294 $368,760
======== ========
</TABLE>
The accompanying notes are an integral part of the condensed consolidated
financial statements.
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<PAGE> 4
PRIMECO INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in Thousands)
<TABLE>
<CAPTION>
Successor Predecessor Successor Predecessor
For The Three For The Three For The Nine For The Nine
Months Ended Months Ended Months Ended Months Ended
------------ ------------ ------------ ------------
September 30 September 30 September 30 September 30
1995 1994 1995 1994
============ ============ ============ ============
<S> <C> <C> <C> <C>
Revenues:
Rental revenue ...................................... $ 36,910 $ 31,282 $ 101,108 $ 86,824
New equipment sales.................................. 8,480 8,080 24,796 23,214
Rental equipment sales............................... 5,608 4,320 17,911 15,949
Parts and merchandise sales.......................... 8,211 7,720 24,168 21,408
Service and other income............................. 3,667 2,981 10,253 8,484
-------- -------- --------- --------
62,876 54,383 178,236 155,879
-------- -------- --------- --------
Cost of Sales:
Depreciation -- rental equipment..................... 10,556 5,035 26,364 13,792
Cost of new equipment sales.......................... 7,063 6,815 20,747 19,765
Cost of rental equipment sales, net of
accumulated depreciation.......................... 5,497 2,569 17,716 10,195
Cost of parts and merchandise sales.................. 6,087 5,873 18,263 16,191
Direct operating expenses............................ 15,397 14,056 44,465 39,321
-------- -------- --------- --------
44,600 34,348 127,555 99,264
-------- -------- --------- --------
Gross profit......................................... 18,276 20,035 50,681 56,615
-------- -------- --------- --------
Selling, general and administrative expenses............ 8,870 7,645 26,129 22,073
Depreciation and amortization:
Non-compete agreements............................... 377 1,343 1,127 4,992
Cost in excess of fair value of assets acquired...... 740 813 2,216 2,440
Property, plant and equipment........................ 604 510 1,758 1,517
Interest expense, net of interest income................ 7,333 3,247 21,382 9,512
-------- -------- --------- --------
17,924 13,558 52,612 40,534
-------- -------- --------- --------
Income/(loss) before income taxes and
extraordinary item................................ 352 6,477 (1,931) 16,081
Income tax expense...................................... 419 2,591 109 6,611
-------- -------- --------- --------
Income/(loss) before extraordinary item.............. $ (67) $ 3,886 $ (2,040) $ 9,470
======== ========
Extraordinary loss, net of tax benefit.................. 0 (1,268)
-------- ---------
Net income/(loss)...................................... (67) (3,308)
-------- ---------
Dividend requirement and accretion on redeemable
preferred stock...................................... 385 1,143
-------- ---------
Net income/(loss) applicable to common shareholder...... $ (452) $ (4,451)
======== =========
</TABLE>
The accompanying notes are an integral part of the condensed consolidated
financial statements.
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<PAGE> 5
PRIMECO INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
<TABLE>
<CAPTION>
Successor Predecessor
For The For The
----------------- -----------------
Nine Months Ended Nine Months Ended
September 30 September 30
1995 1994
================= =================
<S> <C> <C>
Operating Activities:
Net income/(loss)................................................ $ (3,308) $ 9,470
Adjustments to reconcile net (loss)/income to net cash
provided by operating activities:
Depreciation and amortization........................ 31,465 22,740
Deferred income tax provisions....................... (910) 6,423
Net (gain)/loss on sale of rental equipment and
property, plant and equipment.................... 267 (5,383)
Extraordinary loss................................... 1,268 0
Effect of changes in operating assets and liabilities:
Increase in accounts receivables..................... (4,035) (5,280)
Increase in inventories.............................. (5,300) (339)
(Increase)/decrease in other assets.................. (1,433) 150
Decrease in accounts payable, accrued expenses,
and other liabilities............................ (1,317) (1,262)
--------- ---------
Net cash provided by operating activities............ 16,697 26,519
--------- ---------
Investing Activities:
Additions to rental equipment................................ (66,612) (43,996)
Additions to property, plant and equipment................... (2,982) (1,757)
Payments of acquisition costs................................ (328) 0
Proceeds from sales of rental equipment...................... 17,829 16,001
Proceeds from disposal of property, plant and equipment...... 104 166
Other........................................................ 0 (729)
--------- ---------
Net cash used in investing activities............................ (51,989) (30,315)
--------- ---------
Financing Activities:
Net (Payments)/Proceeds from revolving line of credit........ 6,000 10,000
Payment of Subordinated/Term Loan Facility................... 75,500 (5,000)
Proceeds from issuance of Senior Subordinated Debt........... 100,000 0
Payment of financing costs................................... (3,906) 0
Dividends on Preferred stock paid............................ (637)
--------- ---------
Net cash provided by financing activities........................ 25,957 5,000
--------- ---------
Net increase/(decrease) in cash and cash equivalents............. (9,335) 1,204
Cash and cash equivalents at beginning of period................. 12,090 2,128
--------- ---------
Cash and cash equivalents at end of period....................... $ 2,755 $ 3,332
========= =========
</TABLE>
The accompanying notes are an integral part of the condensed consolidated
financial statements.
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<PAGE> 6
PRIMECO INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
The accompanying condensed consolidated financial statements of Primeco
Inc. ("Primeco") have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Rule 10-01 of Regulation S-X. Accordingly, they do not include
all of the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management,
all adjustments (consisting of only normal recurring adjustments) considered
necessary for a fair presentation of Primeco's financial condition, operating
results and cash flows for the interim periods presented have been included.
Operating results and cash flows for the periods presented are not necessarily
indicative of the results that may be expected for the year ended December 31,
1995. These interim financial statements should be read in conjunction with
the Form S-1 dated February 27, 1995, including the financial statements and
notes contained therein, filed with the Securities and Exchange Commission.
2. The Company
The financial statements include the accounts of Primeco, a wholly-owned
subsidiary of Prime Holding, Inc. ("Holdings"). On December 2, 1994, Holdings
acquired Primeco (the "Acquisition") from a subsidiary of Artemis S.A. through
Holdings' subsidiary Prime Acquisition Corp. ("PAC"). Immediately following
the completion of the Acquisition, PAC merged into Primeco, as a result of
which Primeco became a wholly-owned subsidiary of Holdings. For purposes of
identification and description, Primeco is referred to as the "Predecessor" for
the period prior to the Acquisition, the "Successor" for the period subsequent
to the Acquisition and the "Company" for both periods.
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<PAGE> 7
PRIMECO INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Continued)
The following unaudited pro forma statement of operations presents the
results of operations for the nine month period ended September 30, 1994 as
though the controlling ownership of the Predecessor had been acquired on
January 1, 1994, and assumes that there were no other changes in the operations
of the Predecessor. The pro forma results are not necessarily indicative of
the financial results that might have occurred had the transaction included in
the pro forma statement actually taken place on January 1, 1994, or of future
results of operations (dollars in thousands).
<TABLE>
<CAPTION>
Predecessor
For The Pro Forma For
Nine Months The Nine
Ended Months Ended
September 30, Pro Forma September 30,
1994 Adjustments 1994
============= =========== =============
<S> <C> <C> <C>
Revenues...................................... $ 155,879 $ $ 155,879
--------- ----------- ---------
Net income/(loss)............................. $ 9,470 (13,566) (4,096)
=========
Dividend and accretion on Preferred Stock .... 1,143 1,143
----------- --------
Net loss applicable to common shareholder..... $ (14,709) $ (5,239)
=========== ========
</TABLE>
Pro forma adjustments follow the same methodology as is presented in the S-1.
3. Depreciation of Rental Equipment
Rental equipment is recorded at cost and depreciated on a straight-line
basis over the estimated useful life after giving effect to estimated salvage
value. The estimated useful life and salvage value for new equipment is five
years and one-half of original cost, respectively, and for used equipment are
determined based on the age and condition of the equipment when purchased, but
in all cases are less than those used for new equipment.
Expenditures for additions or improvements which extend asset lives are
capitalized in the period incurred. Normal repairs and maintenance costs are
expensed as incurred. When rental equipment is retired or otherwise disposed
of, the related cost and accumulated depreciation are removed from the
respective accounts and any gains or losses are included in results of
operations.
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<PAGE> 8
PRIMECO INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Continued)
In March 1995, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 121 ("SFAS 121"), Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of.
SFAS 121, which is effective for fiscal years beginning after December 15,
1995, requires that long-lived assets and certain identifiable intangibles to
be held and used by an entity, be reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount of an asset may not
be recoverable. The Company will adopt SFAS 121 at the beginning of 1996. It
is anticipated that the impact of adopting this statement will not have a
material effect on the financial statements.
4. Issuance of Senior Subordinated Notes
On March 6, 1995 the Successor issued $100,000,000 of 12.75% Senior
Subordinated Notes due March 1, 2005. The Successor received net proceeds of
approximately $96,000,000, which were used to repay $75,000,000 of indebtedness
under the Successor's Subordinated Loan Facility plus accrued interest and
$20,000,000 of indebtedness under the revolving credit portion of the Senior
Credit Facility. The early repayment of the Subordinated Loan Facility
including the write-off of debt issuance costs of $2,062,000 and net of income
tax benefits of $794,000, has been reflected as an extraordinary loss on the
nine month Statement of Operations.
Maturities of debt under the bank credit agreement and the Senior
Subordinated Notes are as follows as of September 30, 1995 (dollars in
thousands):
<TABLE>
<CAPTION>
Senior Subordinated
Bank Borrowing Notes
-------------- ------------------------
<S> <C> <C>
1995 . . . . . . . . . . . . . . . . . . . $ 500
1996 . . . . . . . . . . . . . . . . . . . 1,000
1997 . . . . . . . . . . . . . . . . . . . 1,000
1998 . . . . . . . . . . . . . . . . . . . 12,000
1999 and thereafter . . . . . . . . . . . . 141,000 $100,000
-------- --------
$155,500 $100,000
======== ========
</TABLE>
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<PAGE> 9
PRIMECO INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF
OPERATIONS
Results of Operations
This discussion and analysis compares the results of operations of the
company during the current three month and nine month periods with the
operating results of operations during the corresponding period in the prior
year.
Three Month Period Ended September 30, 1995 Compared With The Three Month
Period Ended September 30, 1994
Total Revenues for the three months ended September 30, 1995 increased
15.6% to $62.9 million, when compared with the corresponding prior period
revenues of $54.4 million. This increase reflects an increase in all of Prime's
revenue components with Rental Revenues producing the largest dollar increase.
Rental Revenue for the three months ended September 30, 1995 increased
18.0% to $36.9 million, when compared with the corresponding prior period
rental revenues of $31.3 million. This increase is the result of continuing
stong economic conditions, an increase in the average amount of equipment
available for rental and high utilization of rental equipment.
New Equipment Sales for the three months ended September 30, 1995
increased 5.0% to $8.5 million, when compared with the corresponding prior
period sales of $8.1 million. This increase is due primarily to improved
general economic conditions.
Rental Equipment Sales for the three months ended September 30, 1995
increased 29.8% to $5.6 million, when compared with the corresponding prior
period sales of $4.3 million, due to management's ongoing efforts to update the
rental fleet and to meet customer demand for good used rental equipment.
Parts and Merchandise Sales for the three months ended September 30, 1995
increased 6.4% to $8.2 million, when compared with the corresponding prior
period sales of $7.7 million. This increase correlates to the higher rental
revenues and sales of new and used equipment.
Service and Other Income for the three months ended September 30, 1995
increased 23.0% to $3.7 million when compared with the corresponding prior
period sales of $3.0 million. This increase relates to the increased rental
revenue.
Gross Profit for the three months ended September 30, 1995 decreased 8.8%
to $18.3 million, when compared with the corresponding prior period gross
profit of $20.0 million. The decrease in Gross Profit is the result of the
Acquisition on December 2, 1994, which increased the cost of sales due to
higher depreciation expense for rental equipment and the cost of rental
equipment sales resulting from the step-up of rental equipment fleet to its
fair market value. Gross profit was also impacted by higher direct operating
expenses which increased primarily due
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<PAGE> 10
PRIMECO INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF
OPERATIONS - (Continued)
to higher compensation costs (reflecting an increased number of employees) and
increased maintenance costs necessary to support the increased size of the
rental fleet and to staff new rental equipment yards. Direct Operating Expense
as a percent of total revenues actually dropped to 24.5% for the current period
versus 25.8% for the same period in 1994.
Selling, General and Administrative Expenses for the three months ended
September 30, 1995 increased 16.0% to $8.9 million, when compared with the
corresponding prior period expenses of $7.6 million. The increase reflects
higher sales commissions due to increased rental and sales revenue and the
reduction in the prior year period relating to an insurance settlement and a
franchise tax refund.
Depreciation and Amortization - Amortization of non-compete agreement for
the three months ended September 30, 1995 decreased 71.9% to $0.4 million, when
compared with the corresponding prior period amortization of $1.3 million.
This results primarily from lower amortization expense associated with the
Successor's noncompete agreement compared to the noncompete agreement the
Predecessor had with its former owner.
Interest expense (net of interest income) for the three months ended
September 30, 1995 increased 125.8% to $7.3 million, when compared with the
corresponding prior period interest expense of $3.2 million. The increase
primarily reflects higher borrowings outstanding following the Acquisition
which closed on December 2, 1994. The Successor's indebtedness, as of
September 30, 1995, totalled $255.5 million, compared to $138 million for the
Predecessor, as of September 30, 1994.
Nine Month Period Ended September 30, 1995 Compared With The Nine Month Period
Ended September 30, 1994
Total Revenues for the nine months ended September 30, 1995 increased
14.3% to $178.2 million when compared with the corresponding prior period
revenues of $155.9 million. This increase reflects an increase in all of
Prime's revenue components with Rental Revenues producing the largest dollar
increase.
Rental Revenues for the nine months ended September 30, 1995 increased
16.5% to $101.1 million when compared with the corresponding prior period
rental revenues of $86.8 million. The increase reflects higher utilization of
rental equipment resulting from improved economic conditions in Prime's market
areas as well as an increase in the fleet available for rental.
New Equipment Sales for the nine months ended September 30, 1995 increased
6.8% to $24.8 million when compared with the corresponding prior period sales.
This increase reflects strong economic conditions. The overall economic
strength resulted in a gross margin percentage in the sales of new equipment of
16.3 % versus a 14.9% margin from the prior year period.
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<PAGE> 11
PRIMECO INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF
OPERATIONS - (Continued)
Rental Equipment Sales for the nine months ended September 30, 1995
increased 12.3% to $17.9 million when compared with the corresponding prior
period sales of $15.9 million. The increase reflects management efforts to
maintain an updated rental fleet and to meet customer demand for the purchase
of used rental equipment.
Parts and Merchandise Sales for the nine months ended September 30, 1995
increased 12.9% to $24.2 million when compared with the corresponding prior
period sales of $21.4 million. This corresponds with the increased Rental
Revenues and Sales of New Equipment.
Service and Other Income for the nine months ended September 30, 1995
increased 20.9% to $10.3 million when compared with the corresponding prior
period sales of $8.5 million. The revenue classification is supplemental to,
and related to, the increase in Rental Revenues.
Gross Profit for the nine months ended September 30, 1995 decreased 10.5%
to $50.7 million when compared with the corresponding prior period Gross Profit
of $56.6 million. The decrease in Gross Profit is the result of the Acquisition
on December 2, 1994, which increased the cost of sales due to higher
depreciation expense for rental equipment and the cost of rental equipment
sales resulting from the step-up of rental equipment fleet to its fair market
value. Gross Profit was also impacted by Direct Operating Expense increases
associated with the opening of six new rental equipment yards during 1995,
versus three during the comparable period in 1994. As a percent of Revenues,
Direct Operating Expense dropped to 24.9% for the current period versus 25.2%
for the first nine months of the prior period.
Selling, General and Administrative Expense for the nine month period
ended September 30, 1995 increased 18.4% to $26.1 million when compared to the
prior period expense of $22.1 million. The increase reflects high sales
commissions due to increased revenue and the fact that prior period results
were favorably impacted by a large insurance settlement and a franchise tax
refund.
Depreciation and Amortization - Amortization of non-compete agreement for
the nine months ended September 30, 1995 decreased 77.4% to $1.1 million when
compared with corresponding prior period amortization of $5.0 million. This is
due to lower current period expense associated with a smaller non-compete
agreement when compared with the Predecessor's non-compete agreement with its
former owner.
Interest Expense (net of interest income) for the nine months ended
September 30, 1995 increased 124.8% to $21.4 million when compared with the
corresponding prior period Interest Expense of $9.5 million. This reflects
higher borrowing outstanding following the Acquisition, which closed on
December 2, 1994. The successors' indebtedness, as of September 30, 1995,
totalled $255.5 million, compared to $138 million as of September 30, 1994.
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<PAGE> 12
PRIMECO INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF
OPERATIONS - (Continued)
Liquidity and Capital Resources
The Successor provided $16.7 million of cash from operating activities
during the nine month period ending September 30, 1995, compared to net cash of
$26.5 million for the period ending September 30, 1994. During the current
period, cash was used to fund the operating loss and acquire certain assets.
The Company's primary capital requirements were for the purchases of
rental equipment to expand its business and to replace rental equipment sold.
Total purchases of rental equipment were $66.6 million and proceeds from the
sale of used rental equipment totalled $17.8 million for the period ended
September 30, 1995.
On March 6, 1995, the Successor issued $100,000,000 of 12.75% Senior
Subordinated Notes due March 1, 2005. The Successor received net proceeds of
approximately $96,000,000, which were used to repay $75,000,000, of
indebtedness under the Successor's Subordinated Loan Facility plus accrued
interest and; $20,000,000 of indebtedness under the revolving credit portion of
the Senior Credit Facility.
The Successor believes that its cash flows from operating activities,
proceeds from the sale of used rental equipment and its borrowing capacity
under the Successor's revolving credit facility, (as of September 30, 1995 the
Successor has $138,000,000 availability under its $175,000,000 Revolving Credit
Facility) will be sufficient to finance the Successor's operations and
anticipated capital expenditures through 1995.
Other Matters
In March 1995, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 121 ("SFAS 121"), Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of.
SFAS 121, which is effective for fiscal years beginning after December 15,
1995, requires that long-lived assets and certain identifiable intangibles to
be held and used by an entity to be reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount of an asset may not
be recoverable. The Successor will adopt SFAS 121 at the beginning of 1996. It
is anticipated that the impact of adopting this statement will not have a
material effect on the financial statements.
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<PAGE> 13
PRIMECO INC.
PART II. OTHER INFORMATION
Item 5. Other Information
Issuance of Senior Subordinated Debt
On March 6, 1995 the Successor issued $100,000,000 of 12.75% Senior
Subordinated Notes due March 1, 2005. The Successor received net
proceeds of approximately $96,000,000, which were used to repay
$75,000,000, of indebtedness under the Successor's Subordinated Loan
Facility plus accrued interest and; $20,000,000 of indebtedness under
the revolving credit portion of the Senior Credit Facility.
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<PAGE> 14
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.
PRIMECO INC.
November 11, 1995
----------------------------------------
Kevin L. Loughlin
(Executive Vice President,
Chief Financial Officer)
----------------------------------------
John D. Latimer
(Controller)
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<PAGE> 15
Index to Exhibits
Exhibit 27 Financial Data Schedule Ended September 30, 1995.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<EXCHANGE-RATE> 1
<CASH> 2,755
<SECURITIES> 0
<RECEIVABLES> 34,210<F1>
<ALLOWANCES> 0
<INVENTORY> 18,487
<CURRENT-ASSETS> 55,452
<PP&E> 197,858<F2>
<DEPRECIATION> 0
<TOTAL-ASSETS> 392,294
<CURRENT-LIABILITIES> 33,852
<BONDS> 255,500
<COMMON> 1
9,481
0
<OTHER-SE> 65,178
<TOTAL-LIABILITY-AND-EQUITY> 392,294
<SALES> 66,875
<TOTAL-REVENUES> 178,236
<CGS> 56,726
<TOTAL-COSTS> 127,555
<OTHER-EXPENSES> 52,612
<LOSS-PROVISION> 412
<INTEREST-EXPENSE> 21,382
<INCOME-PRETAX> (1,931)
<INCOME-TAX> 109
<INCOME-CONTINUING> (2,040)
<DISCONTINUED> 0
<EXTRAORDINARY> (1,268)
<CHANGES> 0
<NET-INCOME> (3,308)<F3>
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>Net of allowance for doubtful accounts
<F2>Includes equipment for rent and is net of accumulated depreciation
<F3>Before dividends and accretion on redeemable preferred stock
</FN>
</TABLE>
