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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________
FORM 10-Q
( X ) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For Quarterly Period Ended September 30, 1994
Commission File Number 1-2964
__________________
TRANSAMERICA CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 94-0932740
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
600 Montgomery Street
San Francisco, California 94111
(Address of principal executive offices)
(Zip Code)
(4l5) 983-4000
(Registrant's telephone number, including area code)
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
Number of shares of Common Stock, $1 par value, outstanding as of close
of business on October 31, 1994: 70,259,663 shares, after deducting 9,478,799
shares in treasury.
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TRANSAMERICA CORPORATION
FORM 10-Q
Part I. Financial Information
Item 1. Financial Statements.
The following unaudited consolidated financial statements of
Transamerica Corporation and Subsidiaries, for the periods ended September 30,
1994 and 1993, do not include complete financial information and should be
read in conjunction with the Consolidated Financial Statements filed with the
Commission in Transamerica's Annual Report on Form 10-K for the year ended
December 31, 1993. The financial information presented in the financial
statements included in this report reflects all adjustments, consisting only
of normal recurring accruals, which are, in the opinion of management,
necessary for a fair statement of results for the interim periods presented.
In the first quarter of 1994 Transamerica adopted Statement of Financial
Accounting Standards No. 115, Accounting for Certain Investments in Debt and
Equity Securities. This new standard requires Transamerica to report at fair
value those investments which it does not have the positive intent and ability
to hold to maturity. To the extent the securities marked to fair value relate
to interest-sensitive insurance products an adjustment to deferred policy
acquisition costs is also made. The effect of these adjustments, net of
federal income taxes, is recorded in a separate component of shareholders'
equity. There is no effect on the income statement. All of Transamerica's
investments in debt securities have been classified as available for sale at
September 30, 1994.
On March 15, 1994, Transamerica acquired substantially all the operating
assets of the Container Operations of Tiphook plc ("Tiphook"), a London-based
transportation equipment rental company, including certain dry cargo
containers, tank containers, tank chassis, operating leases and other assets
of Tiphook for $1,051 million in cash. For a discussion of this transaction
see Item 2 on Page 8 of this document.
On April 13, 1994, Transamerica sold its remaining 21% ownership interest
in Sedgwick Group plc. Proceeds from the sale were $326.4 million and
resulted in no gain or loss. Transamerica's investment in Sedgwick and its
share of Sedgwick's operating results and related goodwill amortization have
been separated from those of Transamerica's continuing operations and are
classified as discontinued operations. Prior period financial statements have
been reclassified accordingly.
On June 6, 1994, Transamerica completed a "Dutch Auction" self tender
offer by purchasing 4.5 million shares of its common stock, at a price of
$54.75 per share. Transamerica used a portion of the net proceeds from the
sale of its remaining 21% ownership interest in Sedgwick Group plc to purchase
such shares.
On September 16, 1994, Transamerica announced a program to purchase up to
an additional 2 million shares of the company's common stock. As a result of
this, the Dutch Auction self tender and other previously announced share
purchase programs, the number of common shares outstanding at September 30,
1994 was 70.4 million compared to 77.6 million at September 30, 1993.
<PAGE>
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On October 14, 1994, Transamerica initiated a tender offer to purchase
for cash up to 6.4 million depositary shares (80% of the depositary shares
outstanding) representing interests in its 8.5% Preferred Stock, Series D.
The offer is scheduled to close on November 14, 1994. Under the terms of the
offer, stockholders may tender their depositary shares at a price of $26.00
per share. The closing price of the depositary shares on the New York Stock
Exchange Composite Tape on October 13, 1994 was $24.75. If all 80% of the
depositary shares are purchased in the tender offer, $10.4 million of premium
and expenses related to the transaction will be charged directly to
shareholders' equity resulting in a 15 cents per share reduction in fourth
quarter earnings per share.
On October 15, 1994, Transamerica entered into an agreement to sell its
mutual fund subsidiary, Transamerica Fund Management Company, for gross
proceeds of approximately $100 million. The transaction is anticipated to
close by year end and will result in a small gain.
On October 20, 1994, Transamerica elected to call for redemption the
entire $100 million outstanding of its 10% notes due November 15, 1997. The
notes will be redeemed at par, plus interest accrued and unpaid, on
November 30, 1994.
On October 25, 1994, Transamerica Corporation announced completion of the
offering by its affiliate, Transamerica Delaware, L.P., of $200 million of
cumulative Monthly Income Preferred Securities (MIPS), Series A, priced at
9.125% per annum. Proceeds from the offering less transaction costs totaled
$192.6 million.
* * * * *
The consolidated ratios of earnings to fixed charges were computed by
dividing income from continuing operations before fixed charges and income
taxes by the fixed charges. Fixed charges consist of interest and debt
expense and one-third of rent expense, which approximates the interest factor.
Results for the nine months are not necessarily indicative of the results
for the entire year for most of the Corporation's businesses. This is
particularly true in the life insurance field, where mortality results in
interim periods may vary substantially from such results over a longer period.
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TRANSAMERICA CORPORATION AND SUBSIDIARIES
_____________
CONSOLIDATED BALANCE SHEET
Assets
September 30, December 31,
1994 1993
Investments, principally of life
insurance subsidiaries:
Fixed maturities--held for investment $18,553.0
Fixed maturities--available for sale $21,124.1 872.4
Mortgage loans and real estate 516.9 493.0
Equity securities, at market value 425.7 466.1
Loans to life insurance policyholders 404.8 396.5
Short-term investments 190.6 190.8
_________ _________
22,662.1 20,971.8
Finance receivables 7,286.6 6,908.5
Less unearned fees ($247.5 in 1994
and $240.8 in 1993) and allowance for
losses (450.2) (426.0)
_________ _________
6,836.4 6,482.5
Cash and cash equivalents 131.0 92.7
Trade and other accounts receivable 2,629.6 2,015.4
Net assets of discontinued operations 310.2
Property and equipment, less accumulated
depreciation of $932 in 1994 and
$831.6 in 1993:
Land, buildings and equipment 363.7 345.7
Equipment held for lease 2,589.6 1,306.5
Deferred policy acquisition costs 2,234.9 1,929.3
Separate accounts administered by life
insurance subsidiaries 1,525.1 1,366.5
Goodwill, less accumulated amortization of
$124.6 in 1994 and $113.4 in 1993 475.2 495.4
Other assets 729.7 734.5
_________ _________
$40,177.3 $36,050.5
========= =========
(Amounts in millions)
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TRANSAMERICA CORPORATION AND SUBSIDIARIES
_________________
CONSOLIDATED BALANCE SHEET (Continued)
Liabilities and Shareholders' Equity
September 30, December 31,
1994 1993
Life insurance policy liabilities $24,348.6 $21,951.8
Notes and loans payable, principally of
finance subsidiaries, of which $1,640.2
in 1994 and $2,023 in 1993 matures
within one year 9,036.8 7,704.0
Accounts payable and other liabilities 1,939.0 1,352.4
Income taxes 332.9 312.3
Separate account liabilities 1,525.1 1,366.5
Shareholders' equity:
Preferred Stock ($100 par value):
Authorized--1,200,000 shares; issuable
in series, cumulative
Outstanding--Dutch Auction Rate Trans-
ferable Securities, 2,250 shares, at
liquidation preference of $100,000
per share, weighted average dividend
rate of 3.78% in 1994 and 3.05% in 1993 225.0 225.0
Outstanding--Series D, 400,000 shares,
at liquidation preference of $500 per
share, cumulative dividend rate of 8.5% 200.0 200.0
Preference Stock (without par value)--
5,000,000 shares authorized; none
outstanding
Common Stock ($1 par value):
Authorized--150,000,000 shares
Outstanding--70,353,899 shares in 1994
and 76,398,888 shares in 1993, after
deducting 9,384,563 shares and
3,339,574 shares in treasury 70.4 76.4
Additional paid-in capital 149.4 475.2
Retained earnings 2,485.1 2,297.9
Net unrealized gain (loss) from
investments marked to fair value (104.6) 124.1
Foreign currency translation adjustments (30.4) (35.1)
_________ _________
2,994.9 3,363.5
_________ _________
$40,177.3 $36,050.5
========= =========
(Amounts in millions except for share data)
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<TABLE>
TRANSAMERICA CORPORATION AND SUBSIDIARIES
_______________
CONSOLIDATED STATEMENT OF INCOME
<CAPTION>
Nine months ended Three months ended
September 30, September 30,
1994 1993 1994 1993
<S> <C> <C> <C> <C>
REVENUES
Life insurance premiums and related
income $1,141.5 $ 906.9 $ 402.0 $ 300.6
Investment income 1,318.5 1,306.2 454.5 444.1
Finance charges and other fees 773.1 742.0 265.1 248.3
Leasing revenues 445.0 282.7 166.8 99.0
Real estate and tax service revenues 200.6 212.5 51.3 76.1
Gain on investment transactions 16.6 46.9 9.2 14.7
Other 74.4 74.5 22.4 26.4
________ ________ ________ ________
3,969.7 3,571.7 1,371.3 1,209.2
EXPENSES
Life insurance benefits 1,793.8 1,576.4 623.9 529.9
Life insurance underwriting, acquisition
and other expenses 384.8 368.3 128.1 122.7
Leasing operating and maintenance costs 232.6 136.0 88.0 48.2
Interest and debt expense 413.3 388.7 148.2 125.2
Provision for losses on receivables and
assets held for sale 76.0 121.6 27.9 71.9
Other, including administrative and general
expenses 572.2 547.4 193.6 210.9
________ ________ ________ ________
3,472.7 3,138.4 1,209.7 1,108.8
________ ________ ________ ________
497.0 433.3 161.6 100.4
Income taxes (benefit) 182.7 81.9 56.7 (40.7)
________ ________ ________ ________
Income from continuing operations 314.3 351.4 104.9 141.1
Income (loss) from discontinued operations (0.7) 3.2 (2.2)
________ ________ ________ ________
Net income $ 313.6 $ 354.6 $ 104.9 $ 138.9
======== ======== ======== ========
Earnings per share of common stock (based
on weighted average number of shares
outstanding of 73,457,000 in 1994 and
78,957,000 in 1993 after deduction of
preferred dividends):
Income from continuing operations
before investment transactions $3.88 $3.84 $1.31 $1.61
Gain on investment transactions 0.15 0.39 0.09 0.12
_____ _____ _____ _____
Income from continuing operations 4.03 4.23 1.40 1.73
Income (loss) from discontinued operations (0.01) 0.04 (0.03)
_____ _____ _____ _____
Net income $4.02 $4.27 $1.40 $1.70
===== ===== ===== =====
Dividends per share of common stock $1.50 $1.50 $0.50 $0.50
===== ===== ===== =====
Ratio of earnings to fixed charges 2.14 2.06
==== ====
<FN>
(Dollar amounts in millions except for share data)
</TABLE>
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TRANSAMERICA CORPORATION AND SUBSIDIARIES
____________
CONSOLIDATED STATEMENT OF RETAINED EARNINGS
Nine months ended
September 30,
1994 1993
Balance at beginning of year $2,297.9 $2,100.2
Net income 313.6 354.6
Dividends on common stock (108.2) (118.0)
Dividends on preferred stock (18.2) (17.7)
________ ________
Balance at end of period $2,485.1 $2,319.1
======== ========
CONSOLIDATED STATEMENT OF CASH FLOWS
Nine months ended
September 30,
1994 1993
OPERATING ACTIVITIES
Income from continuing operations $ 314.3 $ 351.4
Adjustments to reconcile income from
continuing operations to net cash
provided by operating activities:
Increase in life insurance policy
liabilities, excluding policyholder
balances on interest-sensitive policies 638.1 729.4
Amortization of policy acquisition costs 141.1 143.9
Policy acquisition costs deferred (295.0) (256.6)
Other 351.8 47.3
_________ ________
Net cash provided by operating activities 1,150.3 1,015.4
INVESTING ACTIVITIES
Finance receivables originated (12,901.9) (9,739.0)
Finance receivables collected 12,422.4 9,591.7
Purchase of investments (8,321.2) (7,253.1)
Sales or maturities of investments 6,281.9 5,322.9
Purchase of the container division assets
of Tiphook plc (1,051.0)
Proceeds from disposition of discontinued
operations 326.4 680.9
Cash transactions with discontinued operations 5.4 (417.4)
Other (494.0) (427.7)
_________ ________
Net cash used by investing activities (3,732.0) (2,241.7)
FINANCING ACTIVITIES
Proceeds from debt financing 5,730.3 3,902.8
Payment of notes and loans (4,421.3) (3,904.0)
Receipts from interest-sensitive policies
credited to policyholder account balances 3,477.6 3,309.0
Return of policyholder account balances on
interest-sensitive policies (1,708.4) (1,849.7)
Dividends (126.4) (135.7)
Common stock transactions (331.8) (100.5)
_________ ________
Net cash provided by financing activities 2,620.0 1,221.9
_________ ________
Increase (decrease) in cash and cash
equivalents 38.3 (4.4)
Cash and cash equivalents at beginning
of year 92.7 22.0
_________ ________
Cash and cash equivalents at end of period $ 131.0 $ 17.6
========= ========
(Amounts in millions)
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Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Transamerica Corporation receives funds from its subsidiaries in the
form of dividends, income taxes and interest on loans. The Corporation uses
these funds to pay dividends to its shareholders, reinvest in the operations
of its subsidiaries and pay corporate interest, expenses and taxes.
Reinvested funds are allocated among subsidiaries on the basis of
profitability and capital requirements. Reinvestment may be accomplished by
allowing a subsidiary to retain all or a portion of its earnings, or by
making capital contributions or loans.
The Corporation also borrows funds to finance acquisitions or to lend to
certain of its subsidiaries to finance their working capital needs.
Subsidiaries are required to maintain prudent financial ratios consistent
with other companies in their respective industries and retain the capacity
through committed credit lines to repay working capital loans from the
Corporation.
On March 15, 1994, Transamerica acquired substantially all the operating
assets of the Container Operations of Tiphook plc ("Tiphook"), a London-based
transportation equipment rental company, including certain dry cargo
containers, tank containers, tank chassis, operating leases and other assets
(collectively the "Container Operations"). Transamerica assumed certain
specified liabilities of the Container Operations including trade accounts
payable. Transamerica did not assume any borrowings, tax liabilities or
contingent liabilities of Tiphook. On March 15, 1994, Transamerica paid to
Tiphook $1 billion and delivered $50.7 million to escrow agents for the
establishment of a general escrow account ($40.4 million) and a repairs escrow
account ($10.3 million). Subsequently, Transamerica has made further
payments to Tiphook of $15.6 million upon delivery of certain bills of sale
and releases of liens pending at the date of close.
Upon completion of examination of the closing balance sheet of the
Container Operations as of March 15, 1994 by Transamerica's auditors and
Tiphook's auditors, certain purchase price adjustments were agreed to on
September 19, 1994 and resulted in a $15.3 million purchase price reduction.
The funds were paid to Transamerica from the escrow accounts, discussed above,
in October 1994.
On April 13, 1994, Transamerica sold its remaining 21% ownership interest
in Sedgwick Group plc. Proceeds from the sale were $326.4 million and
resulted in no gain or loss. Transamerica's investment in Sedgwick and its
share of Sedgwick's operating results and related goodwill amortization have
been separated from those of Transamerica's continuing operations and are
classified as discontinued operations. Prior period financial statements have
been reclassified accordingly.
On June 6, 1994, Transamerica completed a "Dutch Auction" self tender
offer by purchasing 4.5 million shares of its common stock, at a price of
$54.75 per share. Transamerica used a portion of the net proceeds from the
sale of its remaining 21% ownership interest in Sedgwick Group plc to purchase
such shares.
<PAGE>
Page 9
On September 16, 1994, Transamerica announced a program to purchase up to
an additional 2 million shares of the company's common stock. As a result of
this, the Dutch Auction self tender and other previously announced share
purchase programs, the number of common shares outstanding at September 30,
1994 was 70.4 million compared to 77.6 million at September 30, 1993.
On October 14, 1994, Transamerica initiated a tender offer to purchase
for cash up to 6.4 million depositary shares (80% of the depositary shares
outstanding) representing interests in its 8.5% Preferred Stock, Series D.
The offer is scheduled to close on November 14, 1994. Under the terms of the
offer, stockholders may tender their depositary shares at a price of $26.00
per share. The closing price of the depositary shares on the New York Stock
Exchange Composite Tape on October 13, 1994 was $24.75. If all 80% of the
depositary shares are purchased in the tender offer, $10.4 million of premium
and expenses related to the transaction will be charged directly to
shareholders' equity resulting in a 15 cents per share reduction in fourth
quarter earnings per share.
On October 15, 1994, Transamerica entered into an agreement to sell its
mutual fund subsidiary, Transamerica Fund Management Company, for gross
proceeds of approximately $100 million. The transaction is anticipated to
close by year end and will result in a small gain.
On October 20, 1994, Transamerica elected to call for redemption the
entire $100 million outstanding of its 10% notes due November 15, 1997. The
notes will be redeemed at par, plus interest accrued and unpaid, on
November 30, 1994.
On October 25, 1994, Transamerica Corporation announced completion of the
offering by its affiliate, Transamerica Delaware, L.P., of $200 million of
cumulative Monthly Income Preferred Securities (MIPS), Series A, priced at
9.125% per annum. Proceeds from the offering less transaction costs totaled
$192.6 million.
Transamerica's income from continuing operations for the first nine
months and third quarter of 1994 decreased $37.1 million (11%) and
$36.2 million (26%) compared to the corresponding periods of 1993. Income
from continuing operations for the first nine months and third quarter of 1994
included net after tax gains from investment transactions aggregating
$10.8 million and $6 million compared to $30.5 million and $9.3 million in the
comparable periods of 1993. In the first nine months and third quarter of
1994 Transamerica's income from continuing operations before investment
transactions decreased $17.4 million (5%) and $32.9 million (25%) from the
comparable periods of 1993 due primarily to decreases in real estate services
and consumer lending operating results and higher unallocated expenses.
Partially offsetting these declines were improvements in commercial lending,
life insurance, leasing and asset management operating results. Income from
continuing operations before investment transactions for the first nine months
and third quarter of 1993 included a $36 million after tax writedown of
repossessed rent-to-own rental stores in commercial lending, charges totaling
$24.7 million after tax primarily for the restructuring of the commercial
lending and real estate services operations and for the realignment of certain
corporate-wide administrative functions and an $8.4 million revaluation of the
deferred tax liability. These items were offset by a $94.2 million tax
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benefit from the satisfactory resolution of prior years' tax matters.
Excluding the aforementioned 1993 items, income from continuing operations
before investment transactions for the first nine months of 1994 increased
$7.7 million (3%) whereas the third quarter of 1994 decreased $7.8 million
(7%) compared to the adjusted amounts for the corresponding 1993 periods.
Included in adjusted income from continuing operations before investment
transactions for the first nine months and third quarter of 1993 was a
$4.8 million charge comprising the effect of the 1993 retroactive one percent
federal tax rate increase.
Gain (loss) on investment transactions, pretax, included in consolidated
revenues, comprises (amounts in millions):
Nine months ended Three months ended
September 30, September 30,
1994 1993 1994 1993
Net gain on sale of investments $43.0 $130.1 $19.7 $42.5
Adjustment for impairment in value (17.5) (59.0) (7.7) (12.4)
Accelerated amortization of deferred
policy acquisition costs (8.9) (24.2) (2.8) (15.4)
_____ ______ _____ _____
$16.6 $ 46.9 $ 9.2 $14.7
===== ====== ===== =====
As required by generally accepted accounting principles, the amortization
of deferred policy acquisition costs was accelerated due to gains realized on
the sale of certain investments. The accelerated amortization of deferred
policy acquisition costs related to universal life and interest-sensitive
insurance products has been included in investment transactions as an offset
to the gains from the sale of investments allocated to those products.
Investment transactions also reflected downward adjustments primarily for
impairment in the value of certain nonperforming fixed maturity investments,
mortgage loans, real estate investments and real estate acquired through
foreclosure. The net gain on sale of investments was higher in 1993 primarily
because of bond call activity.
Transamerica Corporation's continuing operations, principally through its
life insurance subsidiaries, maintain an investment portfolio which aggregated
$22.7 billion at September 30, 1994. Of this amount $21.1 billion is
invested in fixed maturities. At September 30, 1994, 95.9% of the fixed
maturities was rated as "investment grade" with an additional 3.1% rated in
the BB category or its equivalent. Fixed maturity investments are generally
held for long-term investment and used primarily to support life insurance
policy liabilities. The amortized cost of delinquent below investment grade
securities, before provision for impairment in value, was $18.3 million at
September 30, 1994 compared to $31.1 million at December 31, 1993. Provision
for impairment in value has been made to reduce the amortized cost of certain
fixed maturity investments by $101.1 million at September 30, 1994 and
$104 million at December 31, 1993.
<PAGE>
Page 11
Additionally, $516.9 million (2.3% of the investment portfolio), net of
allowance for losses of $54.7 million, was invested in mortgage loans and real
estate including $387.9 million in commercial mortgage loans, $31.9 million in
residential mortgage loans, $106.4 million in real estate investments and
$45.4 million in foreclosed real estate. Foreclosed commercial real estate
decreased $7.8 million (14.7%) from December 31, 1993 to September 30, 1994
due primarily to the sale of foreclosed properties. Problem loans, defined as
delinquent loans and restructured loans yielding less than 8%, totaled
$11.3 million at September 30, 1994. Problem loans decreased $7.2 million
from December 31, 1993 to September 30, 1994. Allowances for possible losses
of $54.7 million at September 30, 1994 and $70.7 million at December 31, 1993
have been established to cover possible losses from mortgage loans and real
estate investments.
The operations of the Company are subject to risk of interest rate
fluctuations to the extent that there is a difference between the cash flows
from the Company's interest-earning assets and the cash flows related to its
liabilities that mature or are repriced in specified periods. In the normal
course of its operations, Transamerica hedges some of its interest rate risk
with financial instrument derivatives. Such derivatives comprise primarily
interest rate swap agreements and interest rate floor agreements. While
Transamerica is exposed to credit risk in the event of nonperformance by the
other party, nonperformance is not anticipated due to the credit rating of
the counterparties. At September 30, 1994, the interest rate swap and floor
agreements are with banks rated A or better by one or more of the major credit
rating agencies.
Transamerica enters into interest rate floor agreements, which provide
for the receipt of payments in the event interest rates fall below specified
levels, interest rate swap agreements, which generally provide that one party
pays interest at a floating rate and the other party pays interest at a fixed
rate. Interest rate floors are intended to mitigate the Company's risk of
reinvesting the cash flow it receives from calls and redemptions on its
investment portfolio at lower interest rates. Interest rate swap agreements
are intended to help the Company to more closely match the cash flow received
from its assets to the payments on its liabilities.
The interest rate floor contracts and certain of the interest rate swap
contracts are designated as hedges of a portion of the investment portfolio
and to the extent those investments are marked to market, the hedge agreements
are also marked to market. At September 30, 1994, such interest rate swap
contracts comprise agreements in which Transamerica receives floating rate
interest and pays a weighted average fixed rate of 6.81% on an aggregate
notional amount of $181.8 million, and agreements whereby it receives fixed
rate payments, at a weighted average rate of 5.81%, and pays floating rate
interest to the contracting party on the aggregate notional amount of
$176.3 million. The interest rate floor agreements at September 30, 1994 were
on an aggregate notional amount of $560.5 million with a weighted average
interest rate of 6.22%. The fair value of these agreements at September 30,
1994, determined on a net present value basis, was a net benefit from
counterparties of $3.2 million comprising a gross benefit of $9.8 million and
a gross obligation of $6.6 million. The effect of marking these asset hedges
to market is a $9.6 million unrealized after tax loss which is included in
shareholders' equity.
<PAGE>
Page 12
The remaining interest rate swap contracts are designated and accounted
for as hedges of a portion of Transamerica's liabilities and outstanding
indebtedness. These agreements are accounted for as hedges, and their cost is
amortized over the shorter of the lives of the contracts or the lives of the
related liabilities. At September 30, 1994, such contracts comprise
agreements in which Transamerica pays floating rate interest and receives
fixed rate payments, at a weighted average rate of 6.04%, on an aggregate
notional amount of $696.5 million; agreements whereby it makes fixed rate
payments, at a weighted average interest rate of 7.13%, and receives floating
rate interest on an aggregate notional amount of $780.7 million; and
agreements whereby it makes floating rate payments referenced to one index and
receives floating rate interest referenced to another index on an aggregate
notional amount of $210 million. The net present value of these interest rate
swap agreements, which offset changes in the fair value of the hedged
liabilities and indebtedness, which in accordance with generally accepted
accounting principles are also carried at amortized cost, was a net obligation
to counterparties of $18.7 million, comprising a gross obligation of $32.3
million and a gross benefit of $13.6 million.
In the first quarter of 1994 Transamerica adopted Statement of Financial
Accounting Standards No. 115, Accounting for Certain Investments in Debt and
Equity Securities. This new standard requires Transamerica to report at fair
value those investments which it does not have the positive intent and ability
to hold to maturity. To the extent the securities marked to fair value relate
to interest sensitive insurance products an adjustment to deferred policy
acquisition costs is also made. The effect of these adjustments, net of
federal income taxes, is recorded in a separate component of shareholders'
equity. There is no effect on the income statement. All of Transamerica's
investments in debt securities have been classified as available for sale at
September 30, 1994.
The net unrealized gain/loss from investments marked to fair value, after
related taxes and deferred acquisition cost adjustments, which is included in
shareholders' equity decreased $228.7 million during the nine months ended
September 30, 1994 and increased $42.3 million during the first nine months of
1993. The net unrealized gain decreased $177.3 million and increased $22.7
million during the third quarters of 1994 and 1993. As discussed in the
preceding paragraph, Transamerica in 1994 adopted Statement of Financial
Accounting Standards No. 115. Accordingly, activity in 1994 and 1993 is not
comparable.
Changes in the earnings, capital requirements and liquidity of the
Corporation's consolidated operations are best understood by considering the
Corporation's separate business segments, which are discussed below.
<PAGE>
Page 13
<TABLE>
REVENUES AND INCOME BY LINE OF BUSINESS
<CAPTION>
Nine months ended September 30, Third quarter
Revenues Income Income
1994 1993 1994 1993 1994 1993
(Amounts in millions)
<S> <C> <C> <C> <C> <C> <C>
Consumer lending $ 515.1 $ 489.4 $ 68.4 $ 71.8 $ 22.7 $ 24.1
Commercial lending 281.1 277.9 38.5 (16.7) 13.1 (33.4)
Leasing 456.6 297.2 45.1 37.6 16.4 10.7
Amortization of goodwill (9.8) (9.8) (3.3) (3.3)
________ ________ ______ ______ ______ ______
Finance 1,252.8 1,064.5 142.2 82.9 48.9 (1.9)
Life insurance 2,474.8 2,248.5 192.9 194.6 71.0 60.4
Real estate services 227.4 230.6 48.9 61.1 8.4 21.9
Asset management 31.5 34.0 2.9 (0.5) 1.3 (0.6)
Amortization of goodwill (1.3) (1.3) (0.4) (0.5)
________ ________ ______ ______ ______ ______
Real estate services
and asset management 258.9 264.6 50.5 59.3 9.3 20.8
Unallocated investment
transactions, interest
and expenses, less
related income taxes (2.0) (5.9) (71.3) 14.6 (24.3) 61.8
Consolidation elimina-
tions (14.8)
________ ________ ______ ______ ______ ______
Total revenues and
income from continuing
operations $3,969.7 $3,571.7 $314.3 $351.4 $104.9 $141.1
======== ======== ====== ====== ====== ======
</TABLE>
Consumer Lending
Consumer lending net income for the first nine months and third quarter
of 1994 was $68.3 million and $22.7 million compared to $71.7 million and
$24.1 million for the comparable periods of 1993. Consumer lending income,
before the amortization of goodwill, for the first nine months and third
quarter of 1994 decreased $3.4 million (5%) and $1.4 million (6%) from the
first nine months and third quarter of 1993. Excluding a $5.3 million benefit
($3.1 million after tax) recorded in the second quarter of 1993 from the
reversal of reserves related to a 1990 securitization and sale of receivables,
income for the first nine months of 1994 decreased $300,000 (-%). The
decrease for the first nine months of 1994 resulted from increased operating
expenses and an increased provision for losses on receivables that more than
offset higher revenues and lower interest expense. The decrease for the third
<PAGE>
Page 14
quarter of 1994 resulted from increased interest and operating expenses and an
increased provision for losses on receivables that more than offset higher
revenues.
Revenues increased $25.7 million (5%) and $10.1 million (6%) in the
first nine months and third quarter of 1994 over the corresponding periods of
1993 mainly due to increased finance charges resulting from higher average
finance receivables outstanding and higher fees due to an increased volume of
real estate secured loans.
Interest expense for the first nine months of 1994 declined $100,000
(-%) from the corresponding period of 1993 due to a lower average interest
rate on long-term debt as a result of the maturity of certain high-coupon debt
replaced at lower rates, which more than offset the increase in short-term
rates and the cost of increased borrowings as a result of the higher level of
receivables outstanding. Interest expense for the third quarter of 1994
increased $4.3 million (7%) over the third quarter of 1993 mainly due to
increased borrowings as a result of the higher level of receivables
outstanding. Operating expenses for the first nine months and third quarter
of 1994 increased $20.9 million (15%) and $3.3 million (7%) over the
corresponding periods of 1993. Excluding the $5.3 million reserve reversal
recorded in the second quarter of 1993, operating expenses in the first nine
months of 1994 increased $15.6 million (11%). The increases were mainly due
to an increase in the number of branches, from 536 at September 30, 1993 to
565 at September 30, 1994, and costs of developing new loan information
systems to handle additional loan products. The provision for losses on
receivables for the first nine months and third quarter of 1994 increased
$15 million (33%) and $7.8 million (51%) due to increased credit losses and
increased growth in net finance receivables over the corresponding periods of
1993. Credit losses, net of recoveries, on an annualized basis as a
percentage of average consumer finance receivables outstanding, net of
unearned finance charges and insurance premiums, were 1.90% and 2.01% for the
first nine months and third quarter of 1994 compared to 1.56% for both the
first nine months and third quarter of 1993. Credit losses increased in the
first nine months of 1994 mainly due to continued sluggishness in the
California economy and a continued weak California real estate market. Any
change in the trend of credit losses is somewhat dependent upon overall
changes in economic conditions and the California real estate market. The
outlook in both areas remains uncertain.
Net consumer finance receivables at September 30, 1994 included
$3.2 billion of real estate secured loans, principally first and second
mortgages secured by residential properties, of which approximately 47% are
located in California. Company policy generally limits the amount of cash
advanced on any one loan, plus any existing mortgage, to between 70% and 80%
(depending on location) of the appraised value of the mortgaged property, as
determined by qualified independent appraisers at the time of loan
origination.
Delinquent finance receivables, which are defined as receivables
contractually past due 60 days or more, were $85.6 million (2.04% of finance
receivables outstanding) at September 30, 1994 compared to $78.8 million
(2.01% of finance receivables outstanding) at December 31, 1993. Management
<PAGE>
Page 15
has established an allowance for losses equal to 2.83% of net consumer finance
receivables outstanding at September 30, 1994 and December 31, 1993.
Generally, by the time an account secured by residential real estate
becomes past due 90 days, foreclosure proceedings have begun, at which time
the account is moved from finance receivables to other assets and is written
down to the estimated realizable value of the collateral if less than the
account balance. After foreclosure, repossessed assets are carried at the
lower of cost or fair value less estimated selling costs. Accounts in
foreclosure and repossessed assets held for sale totaled $236.5 million at
September 30, 1994 compared to $214.7 million at December 31, 1993. The
increase primarily reflects higher inventory in California due to California's
continuing weak real estate market and resultant longer disposal times. Since
future improvement may be impacted by factors such as economic conditions and
the state of the real estate market, the extent and timing of any change in
the trend of foreclosures and repossessed assets remains uncertain.
Commercial Lending
Commercial lending net income for the first nine months and third quarter
of 1994 was $30.4 million and $10.4 million compared to net losses of
$24.8 million and $36.1 million for the comparable periods of 1993.
Commercial lending income, before the amortization of goodwill, for the first
nine months and third quarter of 1994 increased $55.2 million and
$46.5 million over the corresponding periods in 1993. Results for the 1993
periods included: (i) a $50 million ($36 million after tax) provision to
reduce the net carrying value of repossessed rent-to-own stores to their
estimated realizable value; (ii) an $8.8 million after tax charge for the
restructuring of the commercial lending unit's infrastructure; (iii) a
$4.2 million after tax provision for anticipated legal and other costs
associated with the runoff of the liquidating portfolios; (iv) a $4.2 million
tax benefit from the resolution of prior years' tax matters; and (v) a tax
benefit of $1.4 million due to the one percent federal tax increase applied to
deferred taxes. Excluding the aforementioned items, commercial lending
income, before the amortization of goodwill, for the first nine months and
third quarter of 1994 increased $11.8 million (44%) and $3.1 million (31%)
over the corresponding periods of 1993. These improvements were primarily due
to a lower provision for losses on receivables and stronger margins during
1994. Stronger margins were a result of the higher spread between the indices
at which the commercial lending operation lends to customers and the indices
at which funds are borrowed.
Revenues in the first nine months and third quarter of 1994 increased
$3.2 million (1%) and $5.6 million (6%) over the corresponding periods of
1993. This was primarily a result of increased yields during the second and
third quarters of 1994 attributable to rising interest rates.
Interest expense declined $900,000 (1%) compared to the first nine
months of 1993 primarily as a result of lower average borrowings. Interest
expense increased $4 million (15%) during the third quarter of 1994 compared
to the third quarter of 1993 as a result of the current rising interest rate
environment. Operating expenses declined $21.2 million (15%) and $19 million
(30%) during the first nine months and third quarter of 1994 from the same
periods in 1993 due mainly to the previously described third quarter 1993
<PAGE>
Page 16
restructuring charge and provision for anticipated legal and other costs
associated with the runoff of the liquidating portfolio, aggregating
$21.5 million. Expenses in the third quarter of 1994 include a $9 million
($5.5 million after tax) charge for the relocation of the corporate home
office, partially offset by the valuation reversal from the sale of the
repossessed rent-to-own stores. In September 1994, the commercial lending
operation sold its U.S. and Canadian repossessed rent-to-own stores with a net
carrying value of $17.7 million for $23 million. The effect of the
transaction resulted in a $5.3 million ($4 million after tax) reversal of a
valuation allowance no longer required. Excluding the items discussed above,
operating expenses decreased $3.4 million (3%) and $1.2 million (3%) in the
first nine months and third quarter of 1994 from the corresponding 1993
periods primarily due to reduced expenses related to the management of the
liquidating portfolios. The provision for losses on receivables in the first
nine months and third quarter of 1994 were $10.7 million (40%) and
$1.8 million (27%) less than in the comparable periods in 1993 due to lower
credit losses, and lower delinquent and nonearning receivables. Credit
losses, net of recoveries, on an annualized basis as a percentage of average
commercial finance receivables outstanding, net of unearned finance charges,
were 0.24% and 0.18% for the first nine months and third quarter of 1994
compared to 1.27% and 1.81% for the comparable periods of 1993.
Net commercial finance receivables outstanding increased $106.4 million
(4%) from December 31, 1993 to September 30, 1994. Growth in the core
businesses of inventory finance, business credit and insurance finance
increased $146.8 million (5%) which more than offset the decline in the
liquidating portfolios. Management has established an allowance for losses
equal to 2.94% of net commercial finance receivables outstanding as of
September 30, 1994 compared to 2.71% at December 31, 1993.
Delinquent receivables, which are defined as the instalment balance for
inventory finance and business credit receivables and the receivable balance
for all other receivables over 60 days past due, were $21.5 million (0.69% of
receivables outstanding) at September 30, 1994 compared to $28.9 million
(0.96% of receivables outstanding) at December 31, 1993.
Nonearning receivables, which are defined as balances from borrowers that
are over 90 days delinquent or at such earlier time as full collectibility
becomes doubtful, were $28.1 million (0.91% of receivables outstanding) at
September 30, 1994 compared to $33.6 million (1.12% of receivables
outstanding) at December 31, 1993.
Assets held for sale as of September 30, 1994 totaled $27.2 million, net
of a $71.1 million valuation allowance, and consisted of rent-to-own finance
receivables of $86.8 million and other repossessed assets of $11.5 million.
In September 1994, commercial lending sold its repossessed rent-to-own stores.
Assets held for sale at December 31, 1993 totaled $90.1 million, net of a
$157 million valuation allowance, and comprised rent-to-own finance
receivables of $120.5 million, repossessed rent-to-own stores of $107.2
million and other repossessed assets of $19.4 million. Of the rent-to-own
finance receivables, $25.5 million were classified as both delinquent and
nonearning at September 30, 1994 compared to $27.5 million at December 31,
1993.
<PAGE>
Page 17
Leasing
As previously discussed, on March 15, 1994, the leasing operation
purchased substantially all of the assets of the container rental businesses
of Tiphook plc for $1,051 million in cash. The acquired fleet of standard
containers and tank containers totaled 363,000 units. The transaction has
been accounted for as a purchase and the operations of the businesses acquired
have been included in the results of the leasing operation from the date of
acquisition.
Leasing net income for the first nine months and third quarter of 1994
was $43.6 million and $15.9 million compared to $36.1 million and $10.2
million for the comparable periods of 1993. Leasing income, before the
amortization of goodwill, for the first nine months and third quarter of 1994
increased $7.5 million (20%) and $5.7 million (52%). Included in the 1993
results was a $4.3 million tax provision for the revaluation of the deferred
tax liability. Excluding the effects of this adjustment, leasing income
increased $3.2 million (8%) and $1.4 million (9%) for the first nine months
and third quarter of 1994 compared to the corresponding periods of 1993. The
increases were primarily due to a larger fleet size, more on-hire rail trailer
and chassis units and an increased finance lease portfolio, partially offset
by lower utilization and rates in the standard container line, and lower gains
on disposal of units for the nine month period.
Revenues for the first nine months and third quarter of 1994 increased
$159.4 million (54%) and $67.6 million (65%) over the corresponding 1993
periods. The increases were due to the Tiphook acquisition of standard and
tank containers, a larger fleet of new standard and refrigerated containers,
more on-hire rail trailer and chassis units and a larger finance lease
portfolio.
Expenses increased $153.6 million (67%) and $65.6 million (82%) in the
first nine months and third quarter of 1994 over 1993's first nine months and
third quarter mainly due to higher ownership and operating costs of a larger
fleet.
The combined utilization of standard containers, refrigerated containers,
domestic containers, tank containers and chassis averaged 81% for both the
first nine months and third quarter of 1994 compared to 82% and 83% for the
first nine months and third quarter of 1993. Rail trailer utilization was 91%
for both the first nine months and third quarter of 1994 compared to 89% and
92% for the first nine months and third quarter of 1993. European trailer
utilization was 96% and 95% for the first nine months and third quarter of
1994 compared to 88% and 89% for the first nine months and third quarter of
1993.
Real Estate Services
Real estate services comprise Transamerica's real estate tax, property
management and other services.
Net income for the first nine months and third quarter of 1994 was
$48.8 million and $8.3 million compared to $61 million and $21.8 million for
the comparable periods of 1993. Income for the first nine months and third
<PAGE>
Page 18
quarter of 1994 decreased $12.2 million (20%) and $13.5 million (62%) from
the corresponding periods of 1993 primarily due to a significant decline in
new tax service contracts caused by lower mortgage refinancings resulting from
higher interest rates.
Revenue for the first nine months and third quarter of 1994 decreased
$3.2 million (1%) and $22 million (26%) from the comparable periods of 1993
primarily due to a decline in new tax service contracts.
Life Insurance
Net income for the third quarter of 1994 increased $10.6 million (18%)
compared to the third quarter of 1993 whereas net income for the first nine
months of 1994 decreased $1.7 million (1%) compared to the corresponding
period in 1993. Net income included net after tax gains from investment
transactions totaling $13.2 million and $6.1 million in the first nine months
and third quarter of 1994 compared to $34.3 million and $9.3 million in the
same 1993 periods. Income before investment transactions increased
$19.4 million (12%) and $13.7 million (27%) in the first nine months and third
quarter of 1994 over the comparable periods of 1993. The individual life
insurance, structured settlements, living benefits, group pension, reinsurance
and foreign lines all experienced increases in income for the first nine
months of 1994, excluding net gains from investment transactions, resulting
primarily from asset growth, improved or maintained interest spreads and
expense control. Income before investment transactions for the first nine
months and third quarter of 1993 also included a $3.6 million charge for the
retroactive effect of the 1 percent increase in the federal income tax rate on
the deferred tax liability.
Investment transactions for the first nine months and third quarter of
1994 included after tax gains of $26.8 million and $13.1 million realized on
the sale of investments compared to $80.5 million and $26.7 million for the
corresponding periods of 1993. As required by generally accepted accounting
principles, the amortization of deferred policy acquisition costs was
accelerated due to the investment gains by $5.8 million and $1.8 million in
the first nine months and third quarter of 1994 compared to $15.7 million and
$9.8 million in the corresponding periods of 1993. The accelerated
amortization of deferred policy acquisition costs has been included in
investment transactions as an offset to the related gain. Investment
transactions in the first nine months and third quarter of 1994 also reflected
downward adjustments of $7.7 million and $5 million, primarily for impairment
in the value of certain nonperforming fixed maturity investments. Such
downward adjustments were $30.5 million and $7.7 million in the first nine
months and third quarter of 1993.
Premiums and related income increased $234.6 million (26%) and
$101.5 million (34%) for the first nine months and third quarter of 1994
compared to the corresponding periods in 1993 primarily due to higher sales of
annuity products, growth in traditional life insurance, an increase in
reinsurance assumed and an increase in charges on interest-sensitive
policies.
Net investment income for the first nine months and third quarter of 1994
increased $24.1 million (2%) and $9.4 million (2%) over the comparable 1993
<PAGE>
Page 19
periods due primarily to increased investments. Net investment income for the
first nine months and third quarter of 1994 included a $6.4 million and
$0.8 million addition to investment income related to the accelerated
accretion of discounts on securities called or expected to be called. Net
investment income for the first nine months and third quarter of 1993 included
a $40.6 million and $17 million addition to investment income related to the
accelerated accretion of discounts on securities called or expected to be
called. The 1993 amounts were offset in part by charges of $15.9 million and
$1.3 million in the first nine months and third quarter of 1993 that are
included in other expenses and are discussed in the following paragraph.
Investment income for the first nine months of 1993 also included a
$4.7 million reversal of accrued investment income on defaulted securities.
Life insurance benefits and expenses in the first nine months and third
quarter of 1994 increased $233.7 million (12%) and $99.3 million (15%)
compared to the corresponding periods of 1993 principally due to increases in
policy reserves and benefits paid or provided attributable to the larger base
of life insurance and annuities in force, higher commission expense on
increased life insurance premiums and annuity considerations, and higher
amortization of deferred policy acquisition costs (exclusive of accelerated
amortization related to investment gains). Other expenses include charges of
$15.9 million in the first nine months of 1993 primarily attributable to a
provision for the realignment and relocation of certain back office support
functions, anticipated guaranty fund assessments and the establishment of an
allowance for possible loss related to the 1991 sale of a business unit.
Other expenses for the third quarter of 1993 included a charge of $1.3 million
for anticipated guaranty fund assessments.
Cash provided by operations for the first nine months of 1994 was
$300.5 million which was $185.4 million (38%) below the 1993 amount primarily
as a result of the timing in the settlement of certain receivables and
payables, including reinsurance receivables and payables. The company
continues to maintain a sufficiently liquid portfolio to cover its operating
requirements, with remaining funds being invested in longer term securities.
Asset Management
Asset management net income for the first nine months and third quarter
of 1994 was $1.7 million and $900,000 compared to net losses of $1.7 million
and $1.1 million for the comparable periods of 1993. Income, before goodwill
amortization, for the first nine months and third quarter of 1994 was
$2.9 million and $1.3 million compared to losses of $500,000 and $600,000 for
the comparable periods of 1993. The improvement was due primarily to lower
operating expenses within the mutual fund business. As previously discussed,
on October 15, 1994, Transamerica entered into an agreement to sell its mutual
fund subsidiary, Transamerica Fund Management Company, for gross proceeds of
approximately $100 million. The transaction is expected to close by year end
and will result in a small gain.
Unallocated Investment Transactions, Interest and Expenses
Unallocated investment transactions, interest and expenses, after
related income taxes, for the first nine months and third quarter of 1994
increased $85.9 million and $86.1 million from the corresponding periods of
<PAGE>
Page 20
1993. The first nine months and third quarter of 1993 included a tax benefit
of $90 million for the reversal of certain tax reserves offset in part by a
$4 million after tax provision for restructuring corporate-wide
administrative functions, a $3 million additional after tax provision to
increase the supplemental (nonqualified) pension liability and the $3.8
million revaluation of the deferred tax liability. Excluding the
aforementioned items, unallocated investment transactions, interest and
expenses increased $6.7 million (10%) and $6.9 million (39%) in the first nine
months and third quarter of 1994 over the corresponding periods of 1993. The
increases were primarily due to higher costs, principally salary and benefits,
as a result of centralizing certain administrative functions and a lower tax
benefit as a result of the Corporation's normal method of allocating income
taxes to the subsidiaries.
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
EX-11 Statement Re: Computation of Per Share Earnings.
EX-12 Computation of Ratio of Earnings to Fixed Charges.
EX-27 Financial Data Schedule.
(b) Reports on Form 8-K. None.
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.
TRANSAMERICA CORPORATION
(Registrant)
Burton E. Broome
Vice President and Controller
(Chief Accounting Officer)
Date: November 10, 1994
<PAGE>
EXHIBIT EX-11
STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
TRANSAMERICA CORPORATION
Nine months ended September 30,
1994 1993
(Dollar amounts in millions,
except for share data)
Primary
Average shares outstanding 73.5 79.0
Net effect of dilutive stock options--
based on the treasury stock method
using average market price 1.3* 1.9*
____ ____
TOTAL 74.8 80.9
==== ====
Net income $313.6 $354.6
Preferred dividends (18.2) (17.7)
______ ______
Net income to common $295.4 $336.9
====== ======
Per share amount $4.02 $4.27
===== =====
Fully Diluted
Average shares outstanding 73.5 79.0
Net effect of dilutive stock options--
based on the treasury stock method
using the market price at quarter end
if higher than the average market
price for nine months 1.3* 2.3*
____ ____
TOTAL 74.8 81.3
==== ====
Net income $313.6 $354.6
Preferred dividends (18.2) (17.7)
______ ______
Net income to common $295.4 $336.9
====== ======
Per share amount $4.02 $4.27
===== =====
*Not included in per share calculation because effect is less
than 3%.
<PAGE>
EXHIBIT EX-12
TRANSAMERICA CORPORATION AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
Nine Months Ended
September 30,
1994 1993
(Dollar amounts in
millions)
Fixed charges:
Interest and debt expense $413.3 $388.7
One-third of rental expense 24.0 21.4
______ ______
Total $437.3 $410.1
====== ======
Earnings:
Consolidated income from
continuing operations $314.3 $351.4
Provision for income taxes 182.7 81.9
Fixed charges 437.3 410.1
______ ______
Total $934.3 $843.4
====== ======
Ratio of earnings from continuing
operations to fixed charges 2.14 2.06
==== ====
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000,000
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> SEP-30-1994
<CASH> 131
<SECURITIES> 426
<RECEIVABLES> 2,630
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 3,857
<DEPRECIATION> 903
<TOTAL-ASSETS> 40,177
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 70
0
425
<OTHER-SE> 2,499
<TOTAL-LIABILITY-AND-EQUITY> 40,177
<SALES> 0
<TOTAL-REVENUES> 3,970
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,984
<LOSS-PROVISION> 76
<INTEREST-EXPENSE> 413
<INCOME-PRETAX> 497
<INCOME-TAX> 183
<INCOME-CONTINUING> 314
<DISCONTINUED> (1)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 314
<EPS-PRIMARY> 4.02
<EPS-DILUTED> 4.02
</TABLE>
