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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 6, 1998
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The Timken Company
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(Exact name of registrant as specified in its charter)
Ohio 1-1169 34-0577130
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(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
1835 Dueber Avenue, S.W., Canton, Ohio 44706-2798
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (330) 438-3000
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ITEM 5. OTHER EVENTS
In 1997, the Financial Accounting Standards Board issued Statement of Financial
Accounting Standards (SFAS) No. 128, "Earnings Per Share." SFAS No. 128 replaced
the calculation of primary and fully diluted earnings per share with earnings
per share and earnings per share - assuming dilution. Unlike primary earnings
per share, earnings per share excludes any dilutive effects of options, warrants
and convertible securities. Earnings per share - assuming dilution is very
similar to the previously reported fully diluted earnings per share.
The Company adopted SFAS No. 128 in the fourth quarter of 1997.
This filing revises the amounts previously reported for earnings per share in
the following filings to present those amounts pursuant to the requirements of
SFAS No. 128:
1. The Company's Annual Report on Form 10-K for the year ended
December 31, 1996
2. The Company's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1997
3. The Company's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1997
4. The Company's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1997
SELECTED FINANCIAL DATA
The following table displays financial data of The Timken Company and its
consolidated subsidiaries for each of the years in the five year period ended
December 31, 1996 and for the nine months ended September 30, 1997 and 1996. The
selected financial data is qualified by reference to the consolidated financial
statements and other information incorporated by reference in The Timken Company
Annual Report on Form 10-K for each of the five years in the period ended
December 31, 1996. The selected financial information provided below is not
necessarily indicative of future results of operations or financial performance
of The Timken Company.
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30 Year Ended December 31
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1997 1996 1996 1995
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(In thousands of dollars except per share data)
<S> <C> <C> <C> <C>
Operating Results
Net sales $1,946,487 $1,778,924 $2,394,757 $2,230,504
Operating income 220,291 184,794 257,257 210,216
Interest expense (16,295) (12,406) (17,899) (19,813)
Other income (expense) (25,348) (21,012) (31,998) (30,042)
Net income (loss) 123,796 99,907 138,937 112,350
Earnings (loss) per share (1) $ 1.97 $ 1.59(2) $ 2.21(2) $ 1.80(2)
Earnings (loss) per share--
assuming dilution (1) $ 1.93 $ 1.58(2) $ 2.19(2) $ 1.78(2)
Balance Sheet
Total assets $2,224,235 $2,081,214 $2,071,338 $1,925,925
Long-term debt 166,627 140,930 165,835 151,154
Shareholders' equity 1,003,879 886,440 922,228 821,178
</TABLE>
<TABLE>
<CAPTION>
Year Ended December 31
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1994 1993 1992
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(In thousands of dollars except per share data)
<S> <C> <C> <C>
Operating Results
Net sales $1,930,351 $1,708,761 $1,642,310
Operating income 138,575 20,456 48,973
Interest expense (24,872) (29,619) (28,660)
Other income (expense) (27,252) (41,375) (35,542)
Net income (loss) 68,464 (271,932)(3) 4,452
Earnings (loss) per share (1) $ 1.11(2) $ (4.43)(2)(3) $ 0.08(2)
Earnings (loss) per share--
assuming dilution (1) $ 1.10(2) $ (4.43)(2)(3) $ 0.08(2)
Balance Sheet
Total assets $1,858,734 $1,789,719 $1,738,450
Long-term debt 150,907 181,158 173,477
Shareholders' equity 732,891 685,312 985,063
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(1) Effective in the fourth quarter 1997, the Company adopted Statement of
Financial Accounting Standards (SFAS) No. 128, "Earnings Per Share."
Because common stock equivalents were immaterial in prior years, no
difference exists between the application of SFAS No. 128 and previous
methods.
(2) On April 15, 1997, the Company's Board of Directors approved a
two-for-one stock split effected in the form of a stock dividend. All
per share amounts have been retroactively restated to reflect the
two-for-one stock split.
(3) The net loss in 1993 includes a charge of $254,263 ($4.15 per share)
for the cumulative effect of accounting changes on prior years.
EARNINGS PER SHARE COMPUTATION FOR THE THREE YEAR PERIOD ENDED DECEMBER 31, 1996
The following table sets forth the reconciliation of the numerators and the
denominators of earnings per share and earnings per share - assuming dilution
for the years ended December 31:
<TABLE>
<CAPTION>
1996 1995 1994
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(Thousands of dollars, except per share data)
<S> <C> <C> <C>
Numerator:
Net income for earnings per share and earnings per share -- assuming
dilution -- income available to common shareholders $ 138,937 $ 112,350 $ 68,464
Denominator:
Denominator for earnings per share -- weighted-average shares 62,776,132 62,388,736 61,899,250
Effect of dilutive securities:
Stock options and awards -- based on the treasury stock method 733,570 601,274 304,942
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Denominator for earnings per share - assuming dilution -- adjusted
weighted-average shares and assumed conversions 63,509,702 62,990,010 62,204,192
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Earnings per share $ 2.21 $ 1.80 $ 1.11
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Earnings per share -- assuming dilution $ 2.19 $ 1.78 $ 1.10
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</TABLE>
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QUARTERLY EARNINGS PER SHARE DATA
Earnings per share and earnings per share--assuming dilution for quarterly
periods in 1997 and 1996 as reported in the Company's 1997 Forms 10-Q and for
1995 as reported in the Company's 1996 Annual Report are presented below:
<TABLE>
<CAPTION>
Earnings Per
Share
Basic (1) Diluted (1)
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<S> <C> <C>
1997
Three months ended March 31, 1997 $0.66 $0.64
Three months ended June 30, 1997 0.72 0.70
Six months ended June 30, 1997 1.37 1.35
Three months ended September 30, 1997 0.60 0.59
Nine months ended September 30, 1997 1.97 1.93
1996
Three months ended March 31, 1996 0.54 0.53
Three months ended June 30, 1996 0.55 0.54
Six months ended June 30, 1996 1.08 1.07
Three months ended September 30, 1996 0.51 0.50
Nine months ended September 30, 1996 1.59 1.58
Three months ended December 31, 1996 0.62 0.61
1995
First quarter 0.55 0.55
Second quarter 0.50 0.49
Third quarter 0.30 0.30
Fourth quarter 0.45 0.45
</TABLE>
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(1) Annual earnings per share do not equal the sum of the individual
quarters due to differences in the average number of shares outstanding
during the respective periods.
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SIGNATURE
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 hereunto duly authorized.
THE TIMKEN COMPANY
Date: February 6, 1998 By: /s/Gene E. Little
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Gene E. Little
Senior Vice President-Finance
