<PAGE>
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 August 31, 1995
[_] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ________________ to ________________
Commission File Number 1-4887
TEXAS INDUSTRIES, INC.
(Exact name of registrant as specified in the charter)
Delaware 75-0832210
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
1341 West Mockingbird Lane, Suite 700W, Dallas, Texas 75247-6913
(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___
---
As of October 9, 1995, 11,049,834 shares of Registrant's Common Stock, $1.00 par
value, were outstanding.
Page 1 of 15
<PAGE>
INDEX
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION Page
- -----------------------------
<S> <C> <C>
Item 1. Financial Statements
Consolidated Balance Sheets -- August 31, 1995 and May 31, 1995.....................3
Consolidated Statements of Income -- three months ended August 31, 1995
and August 31, 1994..............................................................4
Consolidated Statements of Cash Flows -- three months ended August 31, 1995
and August 31, 1994..............................................................5
Notes to Consolidated Financial Statements..........................................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...................................................14
SIGNATURES
- ----------
</TABLE>
-2-
<PAGE>
(Unaudited)
CONSOLIDATED BALANCE SHEETS
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
August 31, May 31,
- -------------------------------------------------------------------------------
In thousands 1995 1995
- -------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash $ 11,989 $ 25,988
Notes and accounts receivable 105,871 99,445
Inventories 128,749 125,384
Prepaid expenses 51,088 41,957
-------- -------
TOTAL CURRENT ASSETS 297,697 292,774
OTHER ASSETS
Real estate and other investments 26,732 29,392
Goodwill 60,715 61,217
Commissioning costs and other assets 23,380 22,533
-------- -------
110,827 113,142
PROPERTY, PLANT AND EQUIPMENT
Land and land improvements 106,539 105,874
Buildings 55,197 54,749
Machinery and equipment 749,225 737,222
-------- -------
910,961 897,845
Less allowances for depreciation 560,502 550,706
-------- -------
350,459 347,139
-------- -------
$ 758,983 $ 753,055
======== =======
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Trade accounts payable $ 53,424 $ 57,019
Accrued interest, wages and other items 34,499 30,675
Current portion of long-term debt 16,201 17,477
-------- -------
TOTAL CURRENT LIABILITIES 104,124 105,171
LONG-TERM DEBT 171,146 185,274
DEFERRED FEDERAL INCOME TAXES AND OTHER CREDITS 83,564 80,178
MINORITY INTEREST 40,413 39,323
SHAREHOLDERS' EQUITY
Preferred stock 598 598
Common stock, $1 par value 12,534 12,534
Additional paid-in capital 266,045 266,045
Retained earnings 135,234 119,587
Cost of common shares in treasury (54,675) (55,655)
-------- -------
359,736 343,109
-------- -------
$ 758,983 $ 753,055
======== =======
</TABLE>
See notes to consolidated financial statements.
-3-
<PAGE>
(Unaudited)
CONSOLIDATED STATEMENTS OF INCOME
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
Three months ended
August 31,
---------------------------------------------------------------------------------
In thousands except per share 1995 1994
---------------------------------------------------------------------------------
<S> <C> <C>
NET SALES $ 232,104 $ 200,967
COSTS AND EXPENSES (INCOME)
Cost of products sold 183,095 167,421
Selling, general and administrative 16,479 12,668
Interest 5,211 5,512
Other income (1,476) (1,121)
-------- --------
203,309 184,480
-------- --------
INCOME BEFORE THE FOLLOWING ITEMS 28,795 16,487
Provision for income taxes 10,338 5,307
-------- --------
18,457 11,180
Minority interest in Chaparral (1,326) (414)
-------- --------
NET INCOME $ 17,131 $ 10,766
======== ========
Average common shares 11,266 12,663
Net income per common share $ 1.53 $ .85
======== ========
Cash dividends $ .10 $ .05
======== ========
</TABLE>
See notes to consolidated financial statements.
-4-
<PAGE>
(Unaudited)
CONSOLIDATED STATEMENTS OF CASH FLOWS
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
Three months ended
August 31,
- ------------------------------------------------------------------------------------------------------
In thousands 1995 1994
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>
OPERATING ACTIVITIES
Net income $ 17,131 $ 10,766
Gain on disposal of assets 211 (486)
Non-cash items
Depreciation, depletion and amortization 11,978 12,233
Deferred taxes 2,051 2,061
Undistributed minority interest 1,042 130
Other - net 1,590 1,158
Changes in operating assets and liabilities
Notes and accounts receivable (6,420) (18,018)
Inventories and prepaid expenses (12,495) 12,435
Accounts payable and accrued liabilities 957 6,964
Real estate and investments 2,660 282
-------- --------
Net cash provided by operations 18,705 27,525
INVESTING ACTIVITIES
Capital expenditures (14,716) (15,696)
Proceeds from disposition of assets 463 516
Cash surrender value - insurance 234 (135)
Other - net (498) (346)
-------- --------
Net cash used by investing (14,517) (15,661)
FINANCING ACTIVITIES
Repayments of short-term borrowing -- (5,000)
Debt retirements (15,416) (5,791)
Purchase of treasury shares (36) (3)
Dividends paid (1,111) (632)
Other - net (1,624) (820)
-------- --------
Net cash used by financing (18,187) (12,246)
-------- --------
Decrease in cash (13,999) (382)
Cash at beginning of period 25,988 31,766
-------- --------
Cash at end of period $ 11,989 $ 31,384
======== ========
</TABLE>
See notes to consolidated financial statements.
-5-
<PAGE>
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 three-month period ended August 31,
1995, are not necessarily indicative of the results that may be expected for the
year ended May 31, 1996. 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, 1995.
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.
Cash includes highly liquid investments having maturities of less than 90 days
when purchased and considered cash equivalents for cash flow purposes.
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, currently being amortized on a straight-line basis over a 40-year
period, is net of accumulated amortization of $12.7 million at August 31, 1995
and $12.2 million at May 31, 1995. Management reviews remaining goodwill with
consideration toward recovery through future operating results (undiscounted) at
the current rate of amortization.
The Company's policy for new facilities is to capitalize certain costs until the
facility is substantially complete and ready for its intended use. Chaparral
began the commissioning of the large beam mill in February 1991. The mill was
substantially complete and ready for its intended use in the third quarter of
fiscal 1992 with a total of $15.1 million of costs deferred. The amount of
amortization charged to income was $754,000 in the three-month periods ended
August 31, 1995 and 1994, based on a five-year period. Total accumulated
amortization is $10.8 million.
Accounting for income taxes uses the liability method of recognizing and
classifying deferred income taxes. The Company joins in filing a consolidated
return with its subsidiaries. Current and deferred tax expense is allocated
among the members of the group based on a stand-alone calculation of the tax of
the individual member.
Certain amounts in the 1994 financial statements have been reclassified to
conform to the 1995 presentation.
WORKING CAPITAL
Working capital totaled $193.6 million at August 31, 1995, compared to $187.6
million at May 31, 1995.
Notes and accounts receivable of $105.9 million at August, compared with $99.4
million at May, are presented net of allowances for doubtful receivables of $3.6
million at August and $3.2 million at May.
-6-
<PAGE>
WORKING CAPITAL-Continued
Inventories are summarized as follows:
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------
In thousands August May
---------------------------------------------------------------------------------
<S> <C> <C>
Finished products $ 49,680 $ 55,874
Work in process 21,060 19,148
Raw materials and supplies 58,009 50,362
-------- --------
$ 128,749 $ 125,384
======== ========
</TABLE>
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 $11.6 million at August and May.
LONG-TERM DEBT
Long-term debt is comprised of the following:
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
In thousands August May
--------------------------------------------------------------------------------
<S> <C> <C>
Bank obligations, maturing through 1999, interest rates
from 6.62% to 6.88% (.75% over LIBOR) $ 79,000 $ 93,000
Senior notes of Chaparral, due through 2004,
interest rates averaged 10.2% 72,000 72,000
First mortgage notes of Chaparral, due through 2000,
interest rate 14.2% 20,458 20,458
First mortgage notes of Chaparral, due through 1995,
interest rate of 9% (2% over LIBOR) -- 1,248
Pollution control bonds, due through 2007, interest rates
from 6.56% to 10% 10,350 10,350
Other, maturing through 2005, interest rates
from 7% to 10.75% 5,539 5,696
------- -------
187,347 202,752
Less current maturities 16,201 17,477
------- -------
$171,146 $185,275
======= =======
</TABLE>
Annual maturities of long-term debt for each of the five succeeding years are
$16.2, $13.8, $13.7, $22.1 and $82.9 million.
The Company has available a bank-financed $150 million long-term line of credit.
In addition to the $79.0 million currently outstanding under this line, $5.4
million has been utilized to support letters of credit. The available borrowings
began reducing in February 1995 at quarterly rates of $3.8 million through
November 1996 and $5 million thereafter until expiration in November 1999.
Commitment fees at an annual rate of 1/4 of 1% are paid on the unused portion of
this line.
Chaparral has available bank lines of credit of $20 million, which are due to
expire in January 1996, if not renewed. The interest rate charged on borrowings
is .45% over LIBOR. Commitment fees at an annual rate of 1/4 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 working capital,
restrictions on purchases of treasury stock and payment of dividends on common
stock, and 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 $38.6 million as of August 31, 1995. 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 $220.7 million at August 31, 1995 is mortgaged as collateral
for $24.1 million of secured debt.
The amount of interest paid for the three-month periods presented was $3.4
million in 1995, and $3.5 million in 1994.
SHAREHOLDERS' EQUITY
Common stock consists of:
<TABLE>
<CAPTION>
------------------------------------------------------------------------------
In thousands August May
------------------------------------------------------------------------------
<S> <C> <C>
Shares authorized 15,000 15,000
Shares outstanding at end of period 11,036 11,011
Average shares outstanding for period, including equivalents 11,266 12,426
Shares held in treasury 1,498 1,523
Shares reserved for stock options and other 1,285 1,304
</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 August
and May 1995.
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 shareholders 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 directors, 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 three-month period ended August 31, 1995,
follows:
-8-
<PAGE>
STOCK OPTION PLANS-Continued
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
$ In thousands Shares Under Option Aggregate Option Price
--------------------------------------------------------------------------------
<S> <C> <C>
Outstanding at June 1 548,441 $13,928
Granted 138,450 6,048
Exercised (25,076) (602)
Cancelled (16,700) (469)
------- -------
Outstanding at August 31 645,115 $18,905
======= =======
</TABLE>
At August 31, 1995, there were 169,675 shares exercisable and 566,600 shares
available for future grants. Outstanding options expire on various dates to July
14, 2005.
INCOME TAXES
Federal income taxes for the interim periods ended August 31, 1995 and 1994,
have been included in the accompanying financial statements on the basis of an
estimated annual rate. The estimated annualized tax rate is 35.9% for 1995
compared with 32.2% for 1994. The primary reason that these respective tax rates
differ from the 35% statutory corporate rate is due to goodwill expense which is
not tax deductible, percentage depletion which is tax deductible and the net
state income tax expense. The Company made income tax payments of $2.0 million
in 1995 and $2.6 million in 1994.
LEGAL PROCEEDINGS AND CONTINGENT LIABILITIES
The Company is subject to federal, state and local environmental laws and
regulations concerning, among other matters, air emissions, furnace dust
disposal and wastewater discharge. The Company believes it is in substantial
compliance with applicable environmental laws and regulations. Notwithstanding
such compliance, if damage to persons or property or contamination of the
environment has been or is caused by the conduct of the Company's business or by
hazardous substances or wastes used in, generated or disposed of by the Company,
the Company may be held liable for such damages and be required to pay the cost
of investigation and remediation of such contamination. The amount of such
liability could be material. Changes in federal or state laws, regulations or
requirements or discovery of unknown conditions could require additional
expenditures by the Company.
The Company and subsidiaries are defendants in lawsuits which arose in the
normal course of business. In management's judgment (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.
-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 August 31, 1995, and the related
condensed consolidated statements of income and cash flows for the three-month
periods ended August 31, 1995 and 1994. 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, 1995, and the related consolidated statements of
income, shareholders' equity, and cash flows for the year then ended [not
presented herein] and in our report dated July 14, 1995, 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, 1995, is fairly stated, in all material respects, in
relation to the consolidated balance sheet from which it has been derived.
/s/ Ernst & Young LLP
----------------------------------
September 14, 1995
-10-
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Comparison of operations and financial condition for the three months ended
August 31, 1995 to the three months ended August 31, 1994.
RESULTS OF OPERATIONS
Consolidated net sales of $232.1 million increased 15% over the prior year
period. Steel sales were $138.1 million, up $13.8 million, resulting from an
increase in average selling price of 12%, offsetting a slight decrease in
shipments. Structural mill pricing continued to rise as the price increases
announced in the May quarter were realized on 7% higher shipments over the prior
year. Bar mill pricing increased 9% with net sales down due to 16% lower
volumes. Work done during the summer to the bar mill caster will allow the bar
mill to upgrade its product mix. The shift in product mix between bar mill and
structural mills reflects the continuing improved demand for structural beams
and Chaparral's ability to adjust its product mix in order to maximize profit
margins. Cement/concrete sales grew by 23% to $94.0 million. Cement average
trade pricing was up 13% over the prior year on shipments at levels near
productive capacity as construction activity in the Texas region remained
healthy. Ready-mix net sales reflect a 40% increase in volume from expanded
capacity and a 5% increase in average trade prices. Aggregate prices improved
slightly, primarily due to the product mix, on increased sales volume.
BUSINESS SEGMENTS
<TABLE>
<CAPTION>
Three months ended
August 31,
---------------------------------------------------------
In thousands 1995 1994
---------------------------------------------------------
<S> <C> <C>
NET SALES
Bar mill $ 37,235 $ 40,527
Structural mills 99,718 82,945
Transportation service 1,188 910
------- -------
TOTAL STEEL 138,141 124,382
Cement 36,091 28,494
Ready-mix 41,059 27,967
Stone, sand & gravel 20,454 17,424
Other products 17,592 16,735
Interplant (21,233) (14,035)
------- -------
TOTAL CEMENT/CONCRETE 93,963 76,585
------- -------
TOTAL NET SALES $ 232,104 $ 200,967
======= =======
UNITS SHIPPED
Bar mill (tons) 101 120
Structural mills (tons) 262 245
------- -------
TOTAL STEEL TONS 363 365
Cement (tons) 643 575
Ready-mix (cubic yards) 840 599
Stone, sand & gravel (tons) 4,183 3,387
</TABLE>
-11-
<PAGE>
BUSINESS SEGMENTS-Continued
<TABLE>
<CAPTION>
Three months ended
August 31,
------------------------------------------------------------------------------------------
In thousands 1995 1994
------------------------------------------------------------------------------------------
<S> <C> <C>
STEEL OPERATIONS
Gross profit $ 26,060 $ 18,463
Less: Depreciation & amortization 8,088 8,408
Selling, general & administrative 5,732 3,935
Other income (1,106) (129)
------- -------
OPERATING PROFIT 13,346 6,249
CEMENT/CONCRETE OPERATIONS
Gross profit 34,534 26,887
Less: Depreciation, depletion &
amortization 3,721 3,621
Selling, general & administrative 6,213 5,113
Other income (244) (692)
------- -------
OPERATING PROFIT 24,844 18,845
------- -------
TOTAL OPERATING PROFIT 38,190 25,094
------- -------
CORPORATE RESOURCES
Other income 126 300
Less: Depreciation & amortization 169 204
Selling, general & administrative 4,141 3,191
------- -------
(4,184) (3,095)
INTEREST EXPENSE (5,211) (5,512)
------- -------
INCOME BEFORE TAXES & OTHER ITEMS $ 28,795 $ 16,487
======= ========
</TABLE>
Consolidated cost of products sold including depreciation and amortization was
$183.1 million, an increase of $15.7 million over the prior year quarter. Steel
cost of sales was $120.1 million, an increase of $5.9 million caused by higher
raw material and alloy prices and the effect of the start-up of the new bar mill
caster. Concrete/cement costs were up $9.8 million to $63.0 million on increased
volumes.
Operating profit of $38.2 million in 1995 was $13.1 million higher than the
prior year quarter due to increased sales and improved margins. Profits were
$1.9 million lower in steel than the May quarter due to the normal, scheduled
summer shutdown to refurbish the production facilities. Shutdown expenditures
exceeded those of last year by 32% and will be amortized over the remainder of
the fiscal year. Cement/concrete profits were up $1.3 million over the May
quarter as increased volumes improved operating efficiencies.
Selling, general and administrative expenses at $16.5 million increased by $3.8
million, principally due to $2.4 million in increased employee incentive
accruals. Steel SG&A increased $1.8 million to $5.8 million. Cement/concrete
SG&A increased $1.1 million to $6.4 million. Corporate resources SG&A increased
$.9 million to $4.3 million. Interest expense decreased $.3 million compared to
the prior year period due to lower interest rates.
Income tax expense was provided at a 3.7% higher estimated annualized tax rate
which anticipates more pre-tax income in 1995 to be taxed at the 35% U.S.
corporate rate and higher net state income tax expense.
-12-
<PAGE>
CASH FLOWS
Net cash provided by operations at $18.7 million was $8.8 million lower than
1994 due to changes in working capital items. Chaparral reduced inventories by
$17.4 in the 1994 quarter returning the amount of inventory to more normal
historical levels. Chaparral's 1995 inventories grew $4.1 million. Accounts
receivable, on higher monthly sales, increased $6.3 million in steel and $11.7
million in cement/concrete during the 1994 quarter. Accounts receivable
increases during the 1995 quarter were $11.6 million lower overall. Average
days' sales remained unchanged from the prior year.
Investing activities used $14.5 million compared to $15.7 million in 1994, as
capital expenditures were slightly lower overall. Capital budget plans for the
current fiscal year, estimated at $100 million, include anticipated expansion
projects in the cement/concrete operations, as well as, normal replacement and
technological upgrades of existing equipment. Additional items of transportation
and aggregate handling equipment are expected to be leased.
Financing activities used $6.0 million more cash or $18.2 million in 1995 due
primarily to increased debt repayments of $4.6 million. TXI's quarterly cash
dividend, which was increased to $.10 per common share in January 1995, was
double the 1994 rate on approximately 12% fewer outstanding shares due to
treasury share repurchases in the February and May quarters.
FINANCIAL CONDITION
TXI has a $150 million long-term bank line of credit which expires in November
1999. At August 31, 1995, $54.3 million was available for future borrowings.
Chaparral has short-term credit facilities of $20 million, none of which was
utilized during the August 1995 quarter. Chaparral's bank lines are eligible to
renew in January 1996.
The Company anticipates that with these or similar credit facilities and
anticipated cash from operations, funds will be adequate to provide for capital
expenditures, scheduled debt repayments and other known working capital needs.
-13-
<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
(27) Financial Data Schedule
This schedule contains summary financial information extracted from the
Registrant's Unaudited August 31, 1995 Consolidated Financial Statements and is
qualified in its entirety by reference to such financial statements.
The Registrant did not file any reports on Form 8-K during the three months
ended August 31, 1995.
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.
October 12, 1995 /s/ Richard M. Fowler
- ---------------- ------------------------------------------
Richard M. Fowler
Vice President & Chief Financial Officer
October 12, 1995 /s/ James R. McCraw
- ---------------- ------------------------------------------
James R. McCraw
Vice President - Controller
-14-
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibits
<S> <C>
11. Statement re: computation of per share earnings
15. Letter re: Unaudited Interim Financial Information
27. Financial Data Schedule
</TABLE>
<PAGE>
EXHIBIT 11
(Unaudited)
COMPUTATION OF EARNINGS PER SHARE
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
August 31,
- ----------------------------------------------------------------------------------
In thousands except per share 1995 1994
- ----------------------------------------------------------------------------------
<S> <C> <C>
AVERAGE SHARES OUTSTANDING
Primary
Average shares outstanding 11,023 12,490
Stock options and other equivalents -
treasury stock method using
average market prices 243 173
------ ------
TOTAL 11,266 12,663
====== ======
Fully diluted
Average common shares outstanding 11,023 12,490
Stock options and other equivalents -
treasury stock method using end of
quarter market price if higher than
average 318 173
------ ------
TOTAL 11,341 12,663
====== ======
NET INCOME APPLICABLE TO COMMON STOCK
Primary
Net income $17,131 $10,766
Adjustments
Dividend on preferred stock (7) (7)
Contingent price amortization 58 58
------ ------
TOTAL $17,182 $10,817
====== ======
Fully diluted
Net income $17,131 $10,766
Adjustments
Dividend on preferred stock (7) (7)
Contingent price amortization 58 58
------ ------
TOTAL $17,182 $10,817
====== ======
PER SHARE
Primary
Net income per common share
and common equivalent share $ 1.53 $ .85
====== ======
Fully diluted
Net income per common share and
dilutive common equivalent share $ 1.52 $ .85
====== ======
</TABLE>
<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 Registration Statement Number 33-53715
on Form S-8 of Texas Industries, Inc. and in the related Prospectuses of our
report dated September 14, 1995, relating to the unaudited condensed
consolidated interim financial statements of Texas Industries, Inc., which are
included in its Form 10-Q for the quarter ended August 31, 1995.
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 the Section 7 or 11 of the Securities Act of 1933.
/s/ Ernst & Young LLP
------------------------------------
October 10, 1995
Dallas, Texas
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE REGISTRANT'S UNAUDITED AUGUST 31, 1995 CONSOLIDATED FINANCIAL
STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAY-31-1996
<PERIOD-END> AUG-31-1995
<CASH> 11,989
<SECURITIES> 0
<RECEIVABLES> 109,429
<ALLOWANCES> 3,558
<INVENTORY> 128,749
<CURRENT-ASSETS> 297,697
<PP&E> 910,961
<DEPRECIATION> 560,502
<TOTAL-ASSETS> 758,983
<CURRENT-LIABILITIES> 104,124
<BONDS> 171,146
<COMMON> 12,534
0
598
<OTHER-SE> 346,604
<TOTAL-LIABILITY-AND-EQUITY> 758,983
<SALES> 232,104
<TOTAL-REVENUES> 232,104
<CGS> 183,095
<TOTAL-COSTS> 183,095
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 316
<INTEREST-EXPENSE> 5,211
<INCOME-PRETAX> 28,795
<INCOME-TAX> 10,338
<INCOME-CONTINUING> 17,131
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 17,131
<EPS-PRIMARY> 1.53
<EPS-DILUTED> 1.52
</TABLE>
