<PAGE>
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 FEBRUARY 28, 1994
-----------------------------------------
/ / TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the transition period from________________________to______________________
__________________________________________
For Quarter Ended February 28, 1994 Commission file number 1-4887
--------------------- ------
TEXAS INDUSTRIES, INC.
- ----------------------------------------------------------------------------
(Exact name of registrant as specified in the charter)
Delaware 75-0832210
------------------------------- ---------------------
(State or other jurisdiction of (IRS Employer ID No.)
incorporation or organization)
7610 Stemmons Freeway, #200
Dallas, TX 75247
---------------------------------------- --------
(Address of principal executive offices) Zip Code
(Registrant's telephone number, including area code) (214)647-6700
---------------
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
----- -----
11,078,357 Shares of Common Stock, Par Value $1.00, outstanding at April 4,
1994.
Page 1 of 15
<PAGE>
INDEX
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION PAGE
- ------------------------------
Item 1. Financial Statements
Consolidated Balance Sheets -- February 28, 1994
and May 31, 1993. . . . . . . . . . . . . . . . . . . . . . . . 3
Consolidated Statements of Income -- three months ended
and nine months ended February 28, 1994 and February 28, 1993 . 4
Consolidated Statements of Cash Flows -- nine months
ended February 28, 1994 and February 28, 1993 . . . . . . . . . 5
Notes to Consolidated Financial Statements -- February 28, 1994 . . 6
Independent Accountants' Review Report. . . . . . . . . . . . . . . 10
Item 2. Management's Discussion and Analysis of
Operating Results and Financial Condition. . . . . . . . . . . 11
PART II. OTHER INFORMATION
- ---------------------------
Item 6. Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . . . . 13
SIGNATURES
- ----------
2
<PAGE>
(Unaudited)
CONSOLIDATED BALANCE SHEETS
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
February 28, May 31,
1994 1993
---- ----
In thousands
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and temporary investments $ 7,636 $ 33,089
Notes and accounts receivable 81,623 76,711
Inventories 132,510 117,987
Prepaid expenses 32,022 32,745
------- -------
TOTAL CURRENT ASSETS 253,791 260,532
OTHER ASSETS
Real estate and other investments 30,581 30,188
Goodwill 73,496 75,234
Commissioning costs and other assets 24,903 25,788
------- -------
128,980 131,210
PROPERTY, PLANT AND EQUIPMENT
Land and land improvements 88,104 86,697
Buildings 51,626 51,533
Machinery and equipment 730,480 720,526
------- -------
870,210 858,756
Less allowances for depreciation 521,267 493,198
------- -------
348,943 365,558
------- -------
$731,714 $757,300
------- -------
------- -------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Notes payable to banks $ 10,000 $ --
Trade accounts payable 51,054 48,662
Accrued interest, wages and other items 19,676 29,668
Current portion of long-term debt 22,697 22,794
------- -------
TOTAL CURRENT LIABILITIES 103,427 101,124
LONG-TERM DEBT 228,112 267,243
DEFERRED FEDERAL INCOME TAXES AND OTHER CREDITS 73,093 71,313
MINORITY INTEREST 35,820 35,109
STOCKHOLDERS' EQUITY
Preferred stock 598 598
Common stock, $1 par value 11,104 11,100
Capital surplus 221,028 220,776
Earned surplus 60,913 52,933
Cost of common shares in treasury (2,381) (2,896)
------- -------
291,262 282,511
------- -------
$731,714 $757,300
------- -------
------- -------
</TABLE>
See notes to consolidated financial statements.
3
<PAGE>
(Unaudited)
CONSOLIDATED STATEMENTS OF INCOME
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
Three months ended Nine months ended
February 28, February 28,
1994 1993 1994 1993
---- ---- ---- ----
In thousands except per share
<S> <C> <C> <C> <C>
NET SALES $170,101 $142,280 $511,972 $451,197
COSTS AND EXPENSES (INCOME)
Cost of products sold 146,642 131,278 438,403 406,615
Selling, administrative and general 12,192 11,694 36,439 32,233
Interest 6,509 7,899 21,374 24,450
Other income (463) (1,895) (3,684) (3,878)
------- ------- ------- -------
164,880 148,976 492,532 459,420
------- ------- ------- -------
INCOME (LOSS) BEFORE THE FOLLOWING ITEMS 5,221 (6,696) 19,440 (8,223)
INCOME TAXES
Current period provision (benefit) 1,511 (2,343) 6,091 (2,877)
Change in statutory federal tax rate -- -- 1,949 --
------- ------- ------- -------
1,511 (2,343) 8,040 (2,877)
Minority interest in Chaparral (844) (112) (1,523) 202
------- ------- ------- -------
NET INCOME (LOSS) $ 2,866 $ (4,465) $ 9,877 $ (5,144)
------- ------- ------- -------
------- ------- ------- -------
Average common shares 11,166 11,091 11,117 11,078
Net income (loss) per common share $ .26 $ (.40) $ .90 $ (.45)
------- ------- ------- -------
------- ------- ------- -------
Cash dividends $ .05 $ .05 $ .15 $ .15
------- ------- ------- -------
------- ------- ------- -------
</TABLE>
See notes to consolidated financial statements.
4
<PAGE>
(Unaudited)
CONSOLIDATED STATEMENTS OF CASH FLOWS
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
Nine months ended
February 28,
1994 1993
---- ----
In thousands
<S> <C> <C>
OPERATING ACTIVITIES
Net income (loss) $ 9,877 $ (5,144)
Gain on disposal of assets (1,165) (149)
Non-cash items
Depreciation, depletion and amortization 36,814 38,005
Deferred taxes 1,991 (3,576)
Undistributed minority interest 711 (1,053)
Other - net 2,374 (1,276)
Changes in operating assets and liabilities
Notes and accounts receivable (5,775) 5,925
Inventories and prepaid expenses (14,199) 3,330
Accounts payable and accrued liabilities (7,600) (8,102)
Real estate and investments 51 2,313
-------- -------
Net cash provided by operations 23,079 30,273
INVESTING ACTIVITIES
Capital expenditures (16,270) (11,287)
Proceeds from disposition of assets 1,238 324
Proceeds from temporary investments 2,689 2,671
Cash surrender value - insurance (709) 5,613
Other - net (45) (311)
-------- -------
Net cash used by investing (13,097) (2,990)
FINANCING ACTIVITIES
Proceeds of long-term borrowing 71,517 --
Proceeds of short-term borrowing 10,000 --
Debt retirements (110,065) (21,066)
Dividends paid (1,676) (1,670)
Other - net (2,530) 233
-------- -------
Net cash used by financing (32,754) (22,503)
-------- -------
(Decrease) increase in cash (22,772) 4,780
Cash at beginning of period 26,756 14,132
-------- -------
Cash at end of period 3,984 18,912
Temporary investments 3,652 3,857
-------- -------
Cash and temporary investments at end of period $ 7,636 $ 22,769
-------- -------
-------- -------
</TABLE>
See notes to consolidated financial statements.
5
<PAGE>
(Unaudited)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and 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 normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the nine-month period ended February 28,
1994, are not necessarily indicative of the results that may be expected for the
year ended May 31, 1994. For further information, refer to the consolidated
financial statements and footnotes thereto included in the Company's annual
report on Form 10-K for the year ended May 31, 1993.
The consolidated financial statements include the accounts of Texas
Industries, Inc. (the Company) and all subsidiaries. The minority interest
represents the 19.1% separate public ownership of Chaparral Steel Company
(Chaparral).
Property, plant and equipment is recorded at cost. Provisions for
depreciation are computed generally using the straight-line method. Provisions
for depletion of mineral deposits are computed on the basis of the estimated
quantity of recoverable raw materials. Amortization of commissioning costs
associated with Chaparral's large beam mill is computed on a straight-line basis
over a five-year period. Investment tax credit is accounted for using the flow-
through method.
For cash flow purposes, temporary investments, which have maturities of
less than 90 days when purchased, are considered cash equivalents. Temporary
investments of $3.7 million at February 28, 1994 and $6.3 million at May 31,
1993 which are included in cash on the balance sheets, exceed 90 day maturity.
Earnings per share are computed by deducting preferred dividends from net
income and adjusting for amortization of additional goodwill in connection with
the contingent payment for the acquisition of Chaparral, then dividing this
amount by the weighted average number of common shares outstanding during the
period, including common stock equivalents.
Goodwill on the balance sheet is presented net of accumulated amortization
of $9,314,000 at February 28, 1994 and $7,576,000 at May 31, 1993.
The Company has no postretirement health benefits and, therefore, realizes
no effect from recent accounting requirements under Statement of Financial
Accounting Standards 106, "Employers' Accounting for Postretirement Benefits
Other than Pensions" (SFAS 106).
WORKING CAPITAL
Working capital totaled $150.4 million at February 28, 1994, compared to
$159.4 million at May 31, 1993.
Notes and accounts receivable of $81.6 million at February, compared with
$76.7 million at May, are presented net of allowances for doubtful receivables
of $4.8 million at February and $4.2 million at May.
Inventories are as follows
<TABLE>
<CAPTION>
February May
-------- ---
In thousands
<S> <C> <C>
Finished products $ 65,858 $ 54,049
Work in process 26,512 21,279
Raw materials and supplies 40,140 42,659
-------- --------
$132,510 $117,987
-------- --------
-------- --------
</TABLE>
6
<PAGE>
WORKING CAPITAL-Continued
Inventories are stated at cost (not in excess of market) generally using
the last-in, first-out method (LIFO). If the average cost method (which
approximates current replacement cost) had been used, inventory values would
have been higher by $10.5 million at February and $6.6 million at May.
COMMISSIONING COSTS
Chaparral began the commissioning of the large beam mill in February 1991.
Certain costs of the facility, consistent with past accounting practice, were
being capitalized until the facility was substantially complete and ready for
its intended use in the February 1992 quarter. A total of $15.1 million in
costs have been capitalized. During the nine months ended February 28, 1994,
$2.3 million was expensed based on a five-year straight-line amortization.
Total accumulated amortization is $6.3 million.
LONG-TERM DEBT
Annual maturities of long-term debt for each of the five succeeding years
are $22.7, $34.5, $31.2, $31.0, and $30.7 million. Long-term debt is comprised
of the following:
<TABLE>
<CAPTION>
February May
-------- ----
In thousands
<S> <C> <C>
Secured Debt
$71 million Senior note due through 1999,
interest rate at 2% over LIBOR $ 71,000 $ --
First mortgage notes of Chaparral, due through
1995, interest rates at up to 2% over LIBOR 7,256 15,759
First mortgage notes of Chaparral due
through 2001, interest rate 14.2% 26,595 30,687
Purchase money obligations, maturing through 1999,
interest rates from 7% to 11.5% 4,003 3,867
Unsecured Debt
9-3/4% Senior notes due through 2000 -- 24,000
Senior notes of Chaparral, due through 2004,
interest rates to 10.85% 80,000 80,000
Senior notes, due through 1994, interest rate at
5/8% over CD rate -- 18,750
12-7/8% Subordinated debentures, due 1995, effective
rate 13%, less unamortized discount -- 49,924
9% Convertible subordinated debentures, due 2008 47,497 49,965
Pollution control bonds, due through 2007, interest
rates from 4.5% to 10% 11,714 12,719
Other, maturing through 2005, interest rates
from 7.5% to 10% 2,744 4,366
------- -------
250,809 290,037
Less current maturities 22,697 22,794
------- -------
$228,112 $267,243
------- -------
------- -------
</TABLE>
The Company has available a bank line of credit of $25 million of which
$6.0 million has been utilized to support letters of credit. This line is due
to expire in November 1996. Commitment fees at an annual rate of 1/2 of 1% are
paid on the unused portion of this line.
Chaparral has utilized $10 million of its $20 million available bank lines
of credit, which are due to expire in January 1995, if not renewed. Commitment
fees at an annual rate of 3/8 of 1% are paid on the unused portions of these
lines.
7
<PAGE>
LONG-TERM DEBT-Continued
The loan agreements contain covenants which provide for minimum cash flows
and working capital, restrictions on purchases of treasury stock, payment of
dividends on common stock, limitations on incurring certain indebtedness and
making certain investments. Under the most restrictive of these agreements, the
aggregate amount of annual cash dividends on common stock is limited based on
the ratio, excluding Chaparral, of earnings before interest, taxes, depreciation
and amortization plus dividends from Chaparral to fixed charges. Chaparral loan
agreements also restrict dividends and advances to its shareholders, including
the parent company, to $32.6 million as of February 28, 1994. The Company and
Chaparral are in compliance with all loan covenant restrictions.
Property, plant and equipment, principally Chaparral's, carried at a net
amount of approximately $238.2 million at February 28, 1994 is mortgaged as
collateral for $37.9 million of secured debt. The Company's Chaparral stock is
pledged as security for the $71 million Senior note and $25 million bank line of
credit.
The 9% convertible subordinated debentures are subject to anti-dilution
provisions and are convertible using a value of $32.74 per share. The
debentures are redeemable by the Company at par.
The amount of interest paid for the nine months presented was $25.8 million in
1994 and $28.6 million in 1993.
STOCKHOLDERS' EQUITY
Common stock consists of:
<TABLE>
<CAPTION>
February May
-------- ---
In thousands
<S> <C> <C>
Shares authorized 15,000 15,000
Shares outstanding at end of period 11,035 11,015
Average shares outstanding for period,
including equivalents 11,117 11,085
Shares held in treasury 69 85
Shares reserved for:
Convertible subordinated debentures 1,451 1,526
Stock options and other 1,438 640
</TABLE>
There are authorized 100,000 shares of Cumulative Preferred Stock, no par
value, of which 20,000 shares are designated $5 Cumulative Preferred Stock
(Voting), redeemable at $105 per share and entitled to $100 per share upon
dissolution. There were 5,976 shares of $5 Cumulative Preferred Stock
outstanding at February 1994 and May 1993.
An additional 50,000 shares are designated Series A Junior Participating
Preferred Stock, redeemable under certain conditions at a redemption price,
subject to adjustment, equal to 200 times the aggregate amount to be distributed
per share to holders of Common Stock but not less than $100. There are
outstanding rights, issued to common stockholders under the Company's
Shareholders Protection Plan, to purchase 48,484 shares of Series A Junior
Participating Preferred Shares, none of which were outstanding. Under certain
conditions, each right may be exercised to purchase one two-hundredth of a share
for $100. The rights, which are non-voting, expire in 1996 and may be redeemed
by the Company at a price of five cents per right at any time.
STOCK OPTION PLANS
The Company's stock option plans provide that non-qualified and incentive
stock options to purchase Common Stock may be granted to officers and key
employees at market prices at date of grant. Generally, options become
exercisable in installments beginning one or two years after date of grant, and
expire six or ten years later depending on the initial date of grant. A summary
of option transactions for the nine months ended February 28, 1994, follows:
8
<PAGE>
STOCK OPTIONS PLANS-Continued
<TABLE>
<CAPTION>
Shares under Aggregate
Option Option Price
------------- ------------
In thousands
<S> <C> <C>
Outstanding at beginning of period 430 $10,129
Granted 87 2,108
Exercised (31) (818)
Cancelled (22) (584)
--- ------
Outstanding at end of period 464 $10,835
--- ------
--- ------
Reserved for future options 915
---
---
</TABLE>
INCOME TAXES
Federal income taxes for the interim periods ended February 28, 1994 and
1993, have been included in the accompanying financial statements on the basis
of an estimated annual rate. Without consideration of the additional tax
provision caused by the change in the statutory federal tax rate, the estimated
annualized tax rate is 31.3% for 1994 compared with 35.0% for 1993. The primary
reason that these respective tax rates differ from the 35% and 34% statutory
corporate rates is due to goodwill expense which is not tax deductible,
percentage depletion which is tax deductible and the benefit of utilization of
investment tax credit carryforward amounts. The Company made income tax payments
of $7,820,000 in 1994 and $330,000 in 1993.
Effective June 1, 1992, the Company adopted Statement of Financial
Accounting Standards 109, "Accounting for Income Taxes" (SFAS 109). This
standard, which changes the classification of current versus non-current
deferred tax liabilities, did not have a material effect on the Company's
financial position or operating results. The Company recognized an additional
income tax provision of $1,949,000 in the nine months ended February 28, 1994
due to federal tax legislation enacted on August 10, 1993 which raised the
corporate tax rate to 35% on all liabilities and benefits previously recorded.
LEGAL PROCEEDINGS AND CONTINGENT LIABILITIES
The Company and subsidiaries are defendants in lawsuits which arose in the
normal course of business. In management's judgement (based on the opinion of
counsel) the ultimate liability, if any, from such legal proceedings will not
have a material effect on the consolidated financial position.
SUBSEQUENT EVENT
On March 21, 1994, the Company called the outstanding $47.5 million in 9%
convertible subordinated debentures due January 15, 2008. If bondholders chose
to convert all bonds into common stock at the $32.74 per share conversion price,
approximately 1,451,000 shares would be issued April 11, 1994.
9
<PAGE>
EXHIBIT A
Independent Accountants' Review Report
Board of Directors
Texas Industries, Inc.
We have reviewed the accompanying condensed consolidated balance sheet of Texas
Industries, Inc. and subsidiaries as of February 28, 1994, and the related
condensed consolidated statements of income for the three-month and nine-month
periods ended February 28, 1994 and 1993, and the condensed consolidated
statements of cash flows for the nine-month periods ended February 28, 1994 and
1993. These financial statements are the responsibility of the Company's
management.
We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data, and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards, which will be
performed for the full year with the objective of expressing an opinion
regarding the financial statements taken as a whole. Accordingly, we do not
express such an opinion.
Based on our reviews, we are not aware of any material modifications that should
be made to the accompanying condensed consolidated financial statements referred
to above for them to be in conformity with generally accepted accounting
principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of Texas Industries, Inc. and
subsidiaries as of May 31, 1993, and the related consolidated statements of
income, stockholders' equity, and cash flows for the year then ended [not
present herein] and in our report dated July 14, 1993, we expressed an
unqualified opinion on those consolidated financial statements. In our opinion,
the information set forth in the accompanying condensed consolidated balance
sheet as of May 31, 1993, is fairly stated, in all material respects, in
relation to the consolidated balance sheet from which it has been derived.
/s/ Ernst & Young
-------------------------
March 21, 1994
Dallas, Texas
10
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF OPERATING RESULTS AND FINANCIAL CONDITION
(Unaudited)
RESULTS OF OPERATIONS
Comparison of operations and financial condition for the three months and
nine months ended February 28, 1994 to the three months and nine months ended
February 28, 1993.
Consolidated net sales of $170.1 million in the current quarter totalled
$27.8 million or 20% higher than last year. Steel shipments of 339,000 tons
were up slightly over 1993. Average steel pricing of $347 per ton, up 14%,
raised current quarter sales to $118.7 million, an increase of 15%. The trend
of increased selling prices continued as the February quarter average was 4%
higher than the November quarter. However, no major price increases have been
announced since January, so prices should remain near current levels for the
balance of the fiscal year. Cement/concrete sales of $51.4 million during the
quarter were 32% better than 1993. Construction activity in the markets served
by the segment continued its trend of year-over-year improvement which increased
shipments 20-30% during the current nine months. Average cement prices in the
quarter were up 10% over February 1993. Average pricing of aggregate and ready-
mix, somewhat affected by product mix, were relatively flat.
Consolidated cost of products sold in the quarter was 12% higher at $146.6
million. This $15.3 million increase was led by $8.4 million in steel costs,
largely influenced by 32% higher scrap cost, which overshadowed improvements in
mill and conversion costs. The remaining $6.9 million increased cost from
cement/concrete operations resulted from higher volume shipments, as unit costs
of all products within the segment were improved.
Consolidated operating profit of $16.3 million in the quarter was $11.2
million better than last year. Steel operations contributed $6.3 million of
this improvement as product prices managed to stay ahead of scrap cost increases
and results were further enhanced by efficiencies gained from last summer's
restructuring efforts. Cement/concrete operating profits, $5.6 million in the
quarter, were the best winter quarter results in ten years.
Selling, general and administrative costs, at $12.2 million in the quarter
were up slightly, due mostly to steel profit sharing costs. The nine month
total of $36.4 million reflects an increase of $4.2 million. Increased steel
profit sharing costs and severance expense incurred in the first quarter of this
fiscal year are the major differences. Other income of $3.7 million in the nine
months is comprised largely of gains from normal disposal of replacement fixed
assets.
The provision for income tax expense for the nine months includes $1.9
million non-cash adjustment to the liability for deferred federal income tax
incurred in prior years. This amount represents the 1% increase in the
statutory corporate income tax rate signed into law in August 1993. Most U.S.
companies are required to effect this adjustment since last year's FASB
implementation of "Accounting for Income Taxes" (SFAS 109).
CASH FLOWS
Cash provided by operations during the nine months was $23.1 million. That
total is lower than the 1993 period primarily due to a $10.4 million build in
steel receivables and a $19.7 increase in steel inventory and prepaids with
offsets due to increased net income and deferred taxes. Cement/concrete
receivables declined by $4.7 million while inventories and prepaids reduced by
$5.5 million. The build in steel receivables results from higher unit pricing
and increased days' sales during the nine months while the sales pattern in
cement/concrete seasonally declines. Chaparral's prepaid expenses increased
$5.5 million in July for the costs of summer shut-down. As in past years, these
costs are being amortized through the remainder of fiscal 1994.
Investing activities used $13.1 million cash due primarily to capital
expenditures. Capital outlay was $4.8 million for steel and $11.5 million for
cement/concrete.
11
<PAGE>
Financing activities were impacted by TXI's $96 million refinancing with a
group of major banks this year. Proceeds of $71 million were borrowed and,
along with cement/concrete cash balances, used to retire $50 million of 12 7/8%
subordinated debentures and $38 million in senior notes. Chaparral borrowed $10
million against their short-term credit facility during the third quarter.
FINANCIAL CONDITION
The Company has a $25 million short-term credit facility as a result of the
refinancing. The $71 million term loan, currently at 200 basis points over
LIBOR rates, is payable over the next 6 years, and is secured. This refinancing
will reduce interest expense and result in an extended debt retirement schedule.
Additionally, on March 21, 1994, the Company called the $47.5 million 9%
convertible debentures. By April 11, 1994, the bonds will be liquidated at par
or converted into common stock at a conversion price of $32.74 per share. If
all bonds are converted into stock, approximately 1.5 million additional shares
of common stock will be issued. The effect of refinancing and redemption of the
convertible debentures would mean that interest expense, net of tax, would
reduce by approximately $6 million annually, considering the net debt reduction
of over $60 million and the interest rate reduction on refinanced debt, at
current interest rates.
Chaparral has utilized $10 million of its $20 million short-term credit
facilities which will expire January 31, 1995, if not renewed. Management
believes that it will be able to renew these or negotiate similar credit
facilities, if deemed appropriate.
The Company expects that with these or similar credit facilities and
anticipated cash from operations, funds will be adequate to provide for capital
expenditures, scheduled debt payments and other known working capital needs.
12
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
The following exhibits are included herein:
(11) Statement re: Computation of earnings per share
(15) Letter re: Unaudited Interim Financial Information
The Registrant did not file any reports on Form 8-K during the three months
ended February 28, 1994.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
TEXAS INDUSTRIES, INC.
April 12, 1994 /s/ Richard M. Fowler
- -------------- ----------------------------------------
Richard M. Fowler
Vice President & Chief Financial Officer
April 12, 1994 /s/ James R. McCraw
- -------------- ----------------------------------------
James R. McCraw
Vice President - Controller
13
<PAGE>
EXHIBIT 11
(Unaudited)
COMPUTATION OF EARNINGS PER SHARE
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
Three months ended Nine months ended
February 28, February 28,
1994 1993 1994 1993
---- ---- ---- ----
In thousands except per share
<S> <C> <C> <C> <C>
AVERAGE SHARES OUTSTANDING
Primary:
Average shares outstanding 11,026 11,012 11,020 10,963
Stock options and other equivalents -
treasury stock method using
average market prices 140 79 97 115
------ ------ ------ -------
TOTAL 11,166 11,091 11,117 11,078
------ ------ ------ -------
------ ------ ------ -------
Fully diluted:
Average common shares outstanding 11,026 11,012 11,020 10,963
Stock options and other equivalents -
treasury stock method using end of
quarter market price if higher than
average 140 79 97 115
Assumed conversion of 9% convertible
subordinated debentures -- -- -- --
------ ------ ------ -------
TOTAL 11,166 11,091 11,117 11,078
------ ------ ------ -------
------ ------ ------ -------
NET INCOME APPLICABLE TO COMMON STOCK
Primary:
Net income (loss) $ 2,866 $(4,465) $ 9,877 $(5,144)
Adjustments:
Dividend on preferred stock (7) (7) (22) (22)
Contingent price amortization 58 58 174 174
------ ------ ------ -------
TOTAL $ 2,917 $(4,414) $10,029 $(4,992)
------ ------ ------ -------
------ ------ ------ -------
Fully diluted:
Net income (loss) $ 2,866 $(4,465) $ 9,877 $(5,144)
Adjustments:
9% convertible subordinated
debenture interest, net of federal
income tax effect -- -- -- --
Dividend on preferred stock (7) (7) (22) (22)
Contingent price amortization 58 58 174 174
------ ------ ------ -------
TOTAL $ 2,917 $(4,414) $10,029 $(4,992)
------ ------ ------ -------
------ ------ ------ -------
PER SHARE
Primary:
Net income (loss) per common share
and common equivalent share $ .26 $ (.40) $ .90 $ (.45)
------ ------ ------ -------
------ ------ ------ -------
Fully diluted:
Net income (loss) per common share and
dilutive common equivalent share $ .26 $ (.40) $ .90 $ (.45)
------ ------ ------ -------
------ ------ ------ -------
</TABLE>
14
<PAGE>
EXHIBIT 15
Board of Directors
Texas Industries, Inc.
We are aware of the incorporation by reference in the Registration Statement
Number 2-95879 on Form S-8, Post Effective Amendment Number 9 to Registration
Statement Number 2-48986 on Form S-8 and Post-Effective Amendment Number 4 to
Registration Statement Number 2-62649 on Form S-8 of our report dated March 21,
1994, relating to the unaudited interim consolidated financial statements of
Texas Industries, Inc., which are included in its Form 10-Q for the quarter
ended February 28, 1994.
Pursuant to Rule 436(c) of the Securities Act of 1933 our report is not a part
of the Registration Statement prepared or certified by accountants within the
meaning of Section 7 or 11 of the Securities Act of 1933.
/s/ Ernst & Young
---------------------------------
April 7, 1994
Dallas, Texas
15
