TAMPA, Fla., Aug. 1 /PRNewswire-FirstCall/ -- Walter Industries, Inc. today reported earnings of $64.0 million, or $1.24 per diluted share for the second quarter ended June 30, 2006, compared with earnings of $41.5 million, or $0.87 per diluted share in the second quarter last year.
"Each of our three business groups generated improvements in operating results," said Walter Industries Chairman and CEO Gregory E. Hyland. "Mueller Water Products continues to deliver very strong performance, and the implementation of our synergy program is progressing ahead of schedule. Natural Resources also reported increased operating income in the quarter driven by higher metallurgical coal prices. Additionally, actions taken to address challenges in our Homebuilding business are beginning to pay off, resulting in strong year-over-year improvement."
Hyland added, "We continue to make progress on our value-creation strategy. We successfully completed the initial public offering of Mueller Water Products in the second quarter and we are on track to complete the spin- off of this business before the end of 2006. In addition, we continue to evaluate strategic alternatives for our other businesses, including a potential spin-off of our Homebuilding and Financing group, and both organic and external growth opportunities for Natural Resources."
Consolidated net sales and revenues for the second quarter were $825.7 million, up from $468.0 million in the prior-year period. Current quarter results include the addition of $361.8 million in revenues from Mueller Co. and Anvil. Second quarter 2006 results also reflect revenue growth in the Homebuilding and Financing group, principally as a result of higher average net selling prices for delivered homes versus the prior-year period. Revenues at Natural Resources increased 6.3 percent versus the prior-year period as the Company benefited from its focus on the high-quality, hard coking coal market, and away from the lower-priced steam coal market.
Operating income for the current quarter totaled $138.6 million compared to $65.1 million in the second quarter of 2005. Current period results include $61.6 million from the addition of Mueller Co. and Anvil. Results in the Homebuilding and Financing group improved $6.3 million, primarily driven by stronger margins on homes delivered and lower selling, general and administrative costs. Natural Resources' results improved $4.5 million, reflecting higher metallurgical coal prices, partially offset by increased mining costs at Mine No. 4.
Second Quarter Segment Results by Operating Group
Mueller Water Products
Walter Industries acquired Mueller Water Products on Oct. 3, 2005. Therefore, Mueller Co. and Anvil's results for the quarter ended June 30, 2005 are not included in the prior-year financial statements. Mueller Water Products reported combined net sales and revenues for the period ended June 30, 2006 of $505.5 million and operating income for the period of $72.1 million.
Detail on Mueller Water Products' performance for the quarter ended June 30, 2006 is included in its separate press release issued today.
Natural Resources & Sloss
The Natural Resources business reported revenues in the second quarter of $173.1 million, up 6.3 percent versus the same period last year, primarily driven by a 15.2 percent increase in metallurgical coal prices and 29.4 percent higher realized natural gas prices.
Natural Resources sold 1.4 million tons of metallurgical coal at an average price of $109.55 per short ton FOB port during the quarter, compared to 1.4 million tons of metallurgical coal at an average price of $95.11 per short ton FOB port during the same period last year. Shipments for the second quarter of 2005 also included 395,000 tons of steam coal.
The natural gas operation sold 2.0 billion cubic feet of gas at an average price of $8.49 per thousand cubic feet in the second quarter, versus 1.8 billion cubic feet of gas at $6.56 per thousand cubic feet in the prior- year period. Natural gas prices in the current-year period reflect the benefit of hedging approximately 53 percent of production at $10.05 per thousand cubic feet.
Natural Resources reported operating income of $63.1 million in the second quarter, compared to operating income of $58.6 million in the prior-year period. The increase is primarily due to higher metallurgical coal and natural gas pricing, partially offset by higher costs at Mine No. 4. Cost per ton increased at Mine No. 4, predominantly due to lower production volume relative to the prior-year period as a result of thin seam conditions encountered at the beginning of the current longwall panel, which began in April 2006. The thin seam conditions contributed to reduced longwall advance rates and difficulties with roof control. The longwall at Mine No. 4 has since experienced improved advance rates and its production is expected to be 1.4 million to 1.5 million tons during the second half of 2006.
Sloss Industries, which is included in the "Other" segment, reported revenues for the second quarter of $34.9 million, up $2.2 million from the prior-year period. Operating income for the quarter totaled $2.1 million, down $1.0 million from the prior-year period, reflecting a $1.1 million pre-tax, non-cash asset impairment charge at Sloss' Chemicals Division.
Homebuilding & Financing
The Homebuilding and Financing group reported combined revenues of $120.6 million for the second quarter of 2006, compared to $115.7 million in the prior-year period. The 4.2 percent increase versus the prior-year period was primarily due to increased average home selling prices, partially offset by $1.4 million of lower instalment note prepayment income.
The Homebuilding and Financing group's combined operating income was $6.5 million for the quarter, compared to $0.2 million in last year's second quarter. Current year results reflect a significant improvement in gross margins per home delivered and reduced selling, general and administrative expenses, plus consistent earnings from the mortgage portfolio, compared to the second quarter last year.
Homebuilding completed 754 homes during the quarter at an average net selling price of $85,800. Average selling prices increased 13.5 percent versus the prior-year period, reflecting price increases instituted during the third and fourth quarters of 2005.
Financing's loss provision during the quarter increased $0.6 million versus the prior-year period due to a higher overall portfolio balance, coupled with higher sales of foreclosed houses at slightly lower recovery rates. At June 30, 2006, delinquencies on the mortgage portfolio (the percentage of amounts outstanding more than 30 days past due) were 4.0 percent, unchanged versus the prior-year period.
Results for last year's second quarter included $3.2 million of unusual charges related to repair and rework on homes under construction, supplies inventory write-downs and additional accruals for legal and warranty issues. In the current-year period, the group recorded a $1.2 million allowance for doubtful accounts against receivables in the modular home division. Excluding unusual charges in both periods, operating results improved $4.3 million.
Other
Second quarter corporate expenses, included in the "Other" segment, were $2.0 million lower than the same period last year, reflecting reduced severance costs in the current quarter, partially offset by higher stock-based compensation from the adoption of FAS 123(R), "Share-Based Payment."
Interest expense totaled $42.1 million in the second quarter versus $4.1 million for the same period last year, reflecting the increased debt associated with the Mueller Water Products acquisition. In addition, interest expense for the current period included a $4.1 million write off of unamortized debt expense associated with the partial repayment of Mueller Water Products' term debt in the second quarter.
Non-GAAP Financial Measures
Within this announcement, the Company makes reference to certain non-GAAP financial measures, which have directly comparable GAAP financial measures as identified in this release. These non-GAAP measures are provided so that investors have the same financial data that management uses with the belief that it will assist the investment community in properly assessing the underlying performance of the Company for the periods being reported. The reconciliation between GAAP and non-GAAP performance measures is presented in compliance with the provisions of the rules under Regulation G.
Conference Call Web cast
Walter Industries Chairman and CEO Greg Hyland and members of the Company's leadership team will discuss quarterly results and other general business matters on a conference call and live Web cast to be held on Wednesday, Aug. 2, 2006, at 8:30 a.m. Eastern Daylight Time. To listen to the event live or in archive, visit the Company Web site at http://www.walterind.com/ .
About Walter Industries
Walter Industries, Inc. is a diversified company with consolidated annual revenues of approximately $3.1 billion. The Company is a significant producer of high-quality metallurgical coal and natural gas for worldwide markets and is a leader in affordable homebuilding and financing. Walter Industries is also the majority shareholder of Mueller Water Products, a leading water infrastructure, flow control and water transmission products company. Including Mueller Water, the Company employs approximately 10,000 people. For more information about Walter Industries, please visit the Company Web site at http://www.walterind.com/ .
Safe Harbor Statement
Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to differ materially from forecasted results. Those risks include, among others, changes in customers' demand for the Company's products, changes in raw material, labor, equipment and transportation costs and availability, geologic and weather conditions, changes in extraction costs and pricing in the Company's mining operations, changes in customer orders, pricing actions by the Company's competitors, changes in law, the collection of approximately $14 million of receivables associated with a working capital adjustment arising from the sale of a subsidiary in 2003, potential changes in the mortgage-backed capital markets, and general changes in economic conditions. Those risks also include the timing of and ability to execute on the spin-off of Mueller Water Products, Inc. and any other strategic action that may be pursued. Risks associated with forward-looking statements are more fully described in the Company's and Mueller Water Products' filings with the Securities and Exchange Commission. The Company assumes no duty to update its forward-looking statements as of any future date.
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
($ in Thousands)
Unaudited
For the three months
ended June 30,
2006 2005
Net sales and revenues:
Net sales $765,113 $409,563
Interest income on instalment
notes 50,937 53,110
Miscellaneous 9,683 5,281
825,733 467,954
Cost and expenses:
Cost of sales (exclusive of
depreciation) 523,845 296,823
Depreciation 26,627 14,505
Selling, general and
administrative 91,819 54,015
Provision for losses on instalment
notes 2,510 1,949
Postretirement benefits 4,018 3,234
Interest expense - mortgage-
backed/asset-backed notes 28,958 31,102
Interest expense - other debt 42,103 4,097
Amortization of intangibles 8,039 923
Restructuring and impairment
charges 1,361 305
729,280 406,953
Income from continuing operations
before income tax expense and
minority interest 96,453 61,001
Income tax expense (31,932) (19,520)
Income from continuing operations
before minority interest 64,521 41,481
Minority interest in net income of
affiliates, net of income taxes (287) --
Income from continuing operations 64,234 41,481
Discontinued operations, net of
income taxes (1) (273) -
Net income $63,961 $41,481
Basic income per share:
Income from continuing operations $1.48 $1.07
Discontinued operations (0.01) --
Net income $1.47 $1.07
Weighted average number of shares
outstanding 43,528,991 38,660,846
Diluted income per share:
Income from continuing operations $1.25 $0.87
Discontinued operations (0.01) --
Net income $1.24 $0.87
Weighted average number of
dilutive securities 52,174,218 49,144,631
(1) 2006 expenses resulted from the Company's sale of its AIMCOR
subsidiary in December 2003.
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
RESULTS BY OPERATING SEGMENT
($ in Thousands)
Unaudited
For the three months
ended June 30,
2006 2005
NET SALES AND REVENUES:
Mueller Co. $225,225 $--
Anvil 136,539 --
U.S. Pipe 143,718 161,966
Mueller Water Products 505,482 161,966
Natural Resources 173,094 162,833
Homebuilding 64,745 57,117
Financing 55,819 58,606
Homebuilding and Financing Group 120,564 115,723
Other 37,769 35,531
Consolidating Eliminations (11,176) (8,099)
$825,733 $467,954
OPERATING INCOME (LOSS):
Mueller Co. $52,143 $--
Anvil 9,506 --
U.S. Pipe 10,439 12,121
Mueller Water Products 72,088 12,121
Natural Resources 63,104 58,618
Homebuilding (6,832) (13,994)
Financing 13,358 14,216
Homebuilding and Financing Group 6,526 222
Other (3,153) (4,792)
Consolidating Eliminations (9) (1,071)
Operating income 138,556 65,098
Other debt interest expense (42,103) (4,097)
Income from continuing operations
before income tax expense and
minority interest $96,453 $61,001
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
($ in Thousands)
Unaudited
For the six months
ended June 30,
2006 2005
Net sales and revenues:
Net sales $1,459,806 $717,241
Interest income on instalment
notes 101,467 106,603
Miscellaneous 17,729 10,391
1,579,002 834,235
Cost and expenses:
Cost of sales (exclusive of
depreciation) 1,017,826 535,723
Depreciation 52,320 28,825
Selling, general and administrative 182,181 96,585
Provision for losses on instalment
notes 4,815 5,134
Postretirement benefits 8,035 6,472
Interest expense - mortgage-
backed/asset-backed notes 58,934 62,537
Interest expense - other debt 84,655 7,709
Amortization of intangibles 15,729 1,986
Credit for estimated hurricane
insurance losses (1,046) (556)
Restructuring and impairment
charges 5,622 610
1,429,071 745,025
Income from continuing operations
before income tax expense
and minority interest 149,931 89,210
Income tax expense (50,111) (28,547)
Income from continuing operations
before minority interest 99,820 60,663
Minority interest in net income of
affiliates, net of income taxes (287) --
Income from continuing operations 99,533 60,663
Discontinued operations, net of
income taxes (1) (273) (417)
Net income $99,260 $60,246
Basic income per share:
Income from continuing operations $2.37 $1.59
Discontinued operations (0.01) (0.01)
Net income $2.36 $1.58
Weighted average number of shares
outstanding 42,024,318 38,130,618
Diluted income per share:
Income from continuing operations $1.98 $1.29
Discontinued operations (0.01) (0.01)
Net income $1.97 $1.28
Weighted average number of dilutive
securities 51,354,225 48,851,746
(1) 2006 and 2005 expenses resulted from the Company's sale of its
AIMCOR subsidiary in December 2003.
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
RESULTS BY OPERATING SEGMENT
($ in Thousands)
Unaudited
For the six months
ended June 30,
2006 2005
NET SALES AND REVENUES:
Mueller Co. $418,564 $--
Anvil 264,010 --
U.S. Pipe 263,452 286,655
Mueller Water Products 946,026 286,655
Natural Resources 342,192 271,528
Homebuilding $129,134 $105,796
Financing 111,838 117,699
Homebuilding and Financing Group 240,972 223,495
Other 74,217 68,808
Consolidating Eliminations (24,405) (16,251)
$1,579,002 $834,235
OPERATING INCOME (LOSS):
Mueller Co. $86,060 $--
Anvil 10,861 --
U.S. Pipe 5,280 17,601
Mueller Water Products 102,201 17,601
Natural Resources 127,029 83,160
Homebuilding (13,140) (22,543)
Financing 26,350 28,802
Homebuilding and Financing Group 13,210 6,259
Other (6,285) (7,270)
Consolidating Eliminations (1,569) (2,831)
Operating income 234,586 96,919
Other debt interest expense (84,655) (7,709)
Income from continuing operations
before income
tax expense and minority interest $149,931 $89,210
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
Unaudited
For the three
months For the six months
ended June 30, ended June 30,
2006 2005 2006 2005
Depreciation ($ in thousands):
Homebuilding $1,322 $1,216 $2,634 $2,412
Financing 340 355 682 715
Mueller Co. 6,650 -- 13,356 --
Anvil 4,923 -- 9,924 --
U.S. Pipe 5,416 6,625 10,738 13,177
Natural Resources 6,700 5,183 12,545 10,230
Other 1,276 1,126 2,441 2,291
$26,627 $14,505 $52,320 $28,825
Amortization of intangibles ($ in
thousands):
Financing $642 $923 $1,339 $1,986
Mueller Co. 6,269 -- 12,538 --
Anvil 1,128 -- 1,852 --
$8,039 $923 $15,729 $1,986
Restructuring and impairment charges
($ in thousands):
U.S. Pipe Chattanooga plant shutdown
costs $226 $-- $4,487 $--
Mine No. 5 shutdown costs -- 305 -- 610
Other - Sloss Chemical asset
impairment 1,135 -- 1,135 --
$1,361 $305 $5,622 $610
Operating Data:
Homebuilding
New sales contracts 794 1,178 1,570 2,203
Cancellations 158 188 310 366
Unit completions 754 748 1,521 1,398
Average sale price $85,800 $75,600 $84,700 $75,200
Ending homes backlog 1,844 2,440 1,844 2,440
Financing
Delinquencies 4.0% 4.0% 4.0% 4.0%
Prepayment speeds 10.2% 10.5% 9.6% 10.4%
U.S. Pipe
Ending pipe & fittings backlog, tons 85,557 92,512 85,557 92,512
Ending pipe & fittings backlog,
dollars ($ in thousands) $80,005 $79,726 80,005 79,726
Sloss Industries
Tons of foundry coke sold 24,936 34,708 52,681 69,632
Tons of furnace coke sold 79,194 62,220 152,457 124,470
Foundry coke average sale price per
ton $260.62 $272.81 $260.86 $260.86
Furnace coke average sale price per
ton $209.10 $205.69 $208.66 $208.66
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
Unaudited
For the three
months For the six months
ended June 30, ended June 30,
2006 2005 2006 2005
Operating Data:
Natural Resources
Tons sold by type (in thousands):
Metallurgical coal, contracts 1,409 1,375 2,655 2,402
Metallurgical coal, spot sales -- 62 -- 144
Steam coal 2 395 300 787
1,411 1,832 2,955 3,333
Average sale price per ton:
Metallurgical coal, contracts $109.55 $94.08 $111.02 $84.17
Metallurgical coal, spot sales $-- $117.99 $-- $116.00
Steam coal $34.70 $34.75 $35.02 $35.01
Tons sold by mine (in thousands):
Mine No. 4 583 875 1,439 1,563
Mine No. 7 652 659 1,169 1,137
Mine No. 5 176 298 347 633
1,411 1,832 2,955 3,333
Coal cost of sales:
Mine No. 4 per ton $63.21 $39.72 $54.45 $40.29
Mine No. 7 per ton $51.77 $45.89 $50.94 $56.08
Mine No. 5 per ton $71.69 $54.73 $77.40 $53.64
Mine No. 4 idle costs ($ in thousands)
(1) $182 $-- $182 $--
Mine No. 5 idle costs ($ in thousands)
(1) $-- $3,560 $-- $3,560
Mine No. 7 idle costs ($ in thousands)
(1) $-- $-- $200 $--
Other costs ($ in thousands) (2) $2,868 $1,678 $5,493 $2,705
Tons of coal produced (in thousands)
Mine No. 4 384 701 1,153 1,665
Mine No. 7 635 715 1,414 1,297
Mine No. 5 172 109 439 494
1,191 1,525 3,006 3,456
Coal production costs per ton: (3)
Mine No. 4 $55.28 $32.93 $41.37 $29.26
Mine No. 7 $39.76 $32.79 $37.02 $34.50
Mine No. 5 $59.05 $87.81 $60.56 $52.35
Total $47.55 $36.76 $42.12 $34.52
Natural gas sales, in mmcf (in
thousands) 1,976 1,754 3,807 3,510
Natural gas average sale price per
mmcf $8.49 $6.56 $8.88 $6.66
Natural gas cost of sales per mmcf $2.57 $2.54 $2.89 $2.58
(1) Idle costs are charged to period expense when incurred.
(2) Consists of charges (credits) not directly allocable to a specific
mine.
(3) Coal production costs per ton are a component of inventoriable costs.
Other inventoriable costs not included in coal production costs per ton
include Company-paid outbound freight, postretirement benefits, asset
retirement obligation expenses, royalties and Black Lung excise taxes.
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
($ in Thousands)
Unaudited
June 30, December 31,
2006 2005
ASSETS
Cash and cash equivalents (1) $363,528 $137,396
Short-term investments, restricted 86,998 124,573
Instalment notes receivable, net of
allowance of $12,847 and
$12,489, respectively 1,748,334 1,693,922
Receivables, net 417,707 351,115
Inventories 587,644 551,293
Prepaid expenses 30,186 31,320
Property, plant and equipment, net 626,402 603,350
Unamortized debt expense 63,724 75,062
Other long-term assets 95,330 79,303
Identifiable intangibles, net 850,096 858,122
Goodwill 871,583 867,556
$5,741,532 $5,373,012
LIABILITIES AND STOCKHOLDERS'
EQUITY
Accounts payable $192,799 $161,215
Accrued expenses 203,627 213,596
Deferred income taxes 239,715 215,874
Debt:
Mortgage-backed/asset-backed notes 1,698,930 1,727,329
Other debt (1) 1,777,482 2,172,453
Accrued interest 29,280 32,619
Accumulated postretirement benefits
obligation 272,185 275,336
Other long-term liabilities 287,773 285,974
Total liabilities 4,701,791 5,084,396
Minority interest 300,805 --
Stockholders' equity 738,936 288,616
$5,741,532 $5,373,012
(1) On July 3, 2006, the Company used $183.3 million of cash and cash
equivalents to repay 35% of the principal balance of the 10% Senior
Subordinated Notes and the 14 3/4% Senior Discount Notes.
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
AND COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED JUNE 30, 2006
($ in Thousands)
Unaudited
Comprehensive
Total Income
Balance at December 31, 2005 $288,616
Comprehensive income:
Net income 99,260 $99,260
Other comprehensive income, net of
tax:
Cumulative foreign currency
translation adjustment 1,620 1,620
Net unrealized gain on hedges 13,027 13,027
Comprehensive income $113,907
Sale of common stock 168,680
Stock issued upon conversion of
convertible notes 25,862
Gain on sale of investment in
subsidiary through
initial public offering 131,141
Stock issued upon exercise of stock
options 3,617
Tax benefit on the exercise of
stock options 6,156
Dividends paid, $0.08 per share (3,309)
Stock-based compensation 4,266
Balance at June 30, 2006 $738,936
Accumulated
Other
Accumulated Comprehensive
Deficit Income (Loss)
Balance at December 31, 2005 $(602,002) $(61,414)
Comprehensive income:
Net income 99,260
Other comprehensive income, net of
tax:
Cumulative foreign currency
translation adjustment 1,620
Net unrealized gain on hedges 13,027
Comprehensive income
Sale of common stock
Stock issued upon conversion of
convertible notes
Gain on sale of investment in
subsidiary through
initial public offering
Stock issued upon exercise of stock
options
Tax benefit on the exercise of
stock options
Dividends paid, $0.08 per share
Stock-based compensation
Balance at June 30, 2006 $(502,742) $(46,767)
Capital in
Common Excess of Treasury
Stock Par Value Stock
Balance at December 31, 2005 $598 $1,210,751 $(259,317)
Comprehensive income:
Net income
Other comprehensive income, net of
tax:
Cumulative foreign currency
translation adjustment
Net unrealized gain on hedges
Comprehensive income
Sale of common stock 26 168,654
Stock issued upon conversion of
convertible notes 15 25,847
Gain on sale of investment in
subsidiary through
initial public offering 131,141
Stock issued upon exercise of stock
options 5 3,612
Tax benefit on the exercise of stock
options 6,156
Dividends paid, $0.08 per share (3,309)
Stock-based compensation 4,266
Balance at June 30, 2006 $644 $1,547,118 $(259,317)
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
($ in Thousands)
Unaudited
For the six months
ended June 30,
2006 2005
OPERATING ACTIVITIES
Net income $99,260 $60,246
Adjustments to reconcile income to
net cash provided by continuing
operations:
Minority interest in net income of
affiliates, net of tax 287 --
Discontinued operations, net of tax 273 417
Provision for losses on instalment
notes receivable 4,815 5,134
Depreciation 52,320 28,825
Restructuring and impairment
charges 1,135 --
Provision for deferred income taxes 23,422 12,531
Tax (benefit on) provision for the
exercise of employee stock options (6,156) 13,704
Amortization of intangibles 15,729 1,986
Amortization of debt expense 11,353 3,202
Other 20,813 2,405
Decrease (increase) in assets:
Receivables (71,311) (36,831)
Inventories (31,971) (60,716)
Prepaid expenses 1,975 (2,241)
Increase (decrease) in liabilities:
Accounts payable 11,258 18,391
Accrued expenses (15,401) (2,665)
Accrued interest (3,339) (410)
Cash flows provided by continuing
operations 114,462 43,978
Cash flows used in discontinued
operations (273) (417)
Cash flows provided by operating
activities 114,189 43,561
INVESTING ACTIVITIES
Acquisitions, net of cash acquired (5,095) --
Notes from sales and resales of
homes, purchases of loans,
repossessions and write-offs (253,435) (213,772)
Cash collections on accounts and
payouts in advance of maturity 194,208 222,104
Decrease in short-term investments,
restricted 37,575 4,656
Additions to property, plant and
equipment (84,006) (48,088)
Cash proceeds from sale of
property, plant and equipment 3,916 5,923
Decrease in investments 14 3,454
Cash flows used in investing
activities (106,823) (25,723)
FINANCING ACTIVITIES
Issuances of mortgage-backed/asset-
backed notes 97,600 71,732
Retirements of mortgage-
backed/asset-backed notes (126,080) (138,054)
Proceeds from issuance of other
debt -- 83,500
Retirements of other debt (375,476) (63,500)
Sale of common stock 168,680 --
Proceeds from initial public
offering 429,325 --
Tax benefit on the exercise of
employee stock options 6,156 --
Increase in the dollar value of
bank checks outstanding 20,795 --
Other (364) 10,767
Cash flows provided by (used in)
financing activities 220,636 (35,555)
Effect of exchange rate changes on
cash (1,870) --
Net increase (decrease) in cash and
cash equivalents 226,132 (17,717)
Cash and cash equivalents at
beginning of period 137,396 46,924
Cash and cash equivalents at end of
period $363,528 $29,207
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