-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DQpStrmUdEuOJgIbFpo8oQRnDm0H4c9hHhuByf7hCyIuB06Y6cM4q34cSupM47bH D9DCj8bTsD7x3hp7byCJhQ== 0000106455-99-000038.txt : 19991117 0000106455-99-000038.hdr.sgml : 19991117 ACCESSION NUMBER: 0000106455-99-000038 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990930 FILED AS OF DATE: 19991115 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WESTMORELAND COAL CO CENTRAL INDEX KEY: 0000106455 STANDARD INDUSTRIAL CLASSIFICATION: BITUMINOUS COAL & LIGNITE MINING [1220] IRS NUMBER: 231128670 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-11155 FILM NUMBER: 99752533 BUSINESS ADDRESS: STREET 1: 2 NORTH CASCADE AVENUE 14TH FLOOR STREET 2: 200 S BROAD ST CITY: COLORADO SPRINGE STATE: CO ZIP: 80903 BUSINESS PHONE: 7194422600 MAIL ADDRESS: STREET 1: 2 N CASCADE AVE STREET 2: # 14THFL CITY: COLORADO SPRINGS STATE: CO ZIP: 80903-1614 10-Q 1 THIRD QUARTER FORM 10-Q FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1999 OR ( ) 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 0-752 WESTMORELAND COAL COMPANY ------------------------- (Exact name of registrant as specified in its charter) DELAWARE 23-1128670 -------- ---------- (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.) 2 North Cascade Avenue 14th Floor Colorado Springs, Colorado 80903 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, area code 719-442-2600 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 [ ] Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of November 1, 1999: 7,059,663 PART I - FINANCIAL INFORMATION Item 1 Financial Statements Westmoreland Coal Company and Subsidiaries Consolidated Balance Sheets - ------------------------------------------------------------------------------------------------- (Unaudited) September 30, 1999 December 31, 1998 - ----------------------------------------------------------- ------------------ ----------------- (in thousands)
Assets Current assets: Cash and cash equivalents $ 31,931 $ 84,073 Receivables: Trade 3,794 2,566 Terminated pension plan, net 500 500 Other 1,043 2,730 - ----------------------------------------------------------- ------------------ ----------------- 5,337 5,796 Other current assets 1,496 691 - ----------------------------------------------------------- ------------------ ----------------- Total current assets 38,764 90,560 - ----------------------------------------------------------- ------------------ ----------------- Property, plant and equipment: Land and mineral rights 10,572 10,990 Plant and equipment 66,125 94,989 - ----------------------------------------------------------- ------------------ ----------------- 76,697 105,979 Less accumulated depreciation and depletion 39,743 69,029 - ----------------------------------------------------------- ------------------ ----------------- 36,954 36,950 Investment in independent power projects 42,831 62,386 Investment in Dominion Terminal Associates (DTA) 4,778 5,475 Workers' compensation bond 4,754 4,140 Prepaid pension cost 3,913 3,748 Excess of trust assets over pneumoconiosis benefit obligation 8,691 10,891 Security deposits 10,148 - Other assets 1,513 1,456 - ----------------------------------------------------------- ------------------ ----------------- Total Assets $ 152,346 $ 215,606 =========================================================== ================== ================= (Continued) See accompanying Notes to Consolidated Financial Statements.
Westmoreland Coal Company and Subsidiaries Consolidated Balance Sheets (Continued) - ------------------------------------------------------------------------------------------------- (Unaudited) September 30, 1999 December 31, 1998 - ----------------------------------------------------------- ------------------- ----------------- (in thousands)
Liabilities and Shareholders' Equity Current liabilities: Current installments of long-term debt $ 218 $ 200 Accounts payable and accrued expenses 8,169 11,249 Workers compensation 3,200 3,800 Postretirement medical costs 11,066 11,066 UMWA 1974 Pension Plan obligation 1,170 - Reorganization expenses 1,257 7,900 Consent judgment payment obligation - 39,006 Reclamation costs 100 100 Income taxes 75 2,185 - ----------------------------------------------------------- ------------------- ----------------- Total current liabilities 25,255 75,506 - ----------------------------------------------------------- ------------------- ----------------- Long-term debt, less current installments 1,333 1,562 Accrual for workers compensation 15,329 17,338 Accrual for postretirement medical costs 79,607 73,143 1974 UMWA Pension Plan obligations 11,030 13,776 Accrual for reclamation costs, less current portion 2,752 3,046 Other liabilities 1,947 2,370 Minority interest 7,692 7,020 Commitments and contingent liabilities Shareholders' equity Preferred stock of $1.00 par value Authorized 5,000,000 shares; Issued 311,843 shares at September 30, 1999, 312 575 575,000 shares at December 31, 1998 Common stock of $2.50 par value Authorized 20,000,000 shares; Issued 7,059,663 shares at September 30, 1999, 17,649 17,413 6,965,328 shares at December 31, 1998 Other paid-in capital 75,046 94,630 Accumulated deficit (85,606) (90,773) - ----------------------------------------------------------- ------------------- ----------------- Total shareholders' equity 7,401 21,845 - ----------------------------------------------------------- ------------------- ----------------- Total Liabilities and Shareholders' Equity $ 152,346 $ 215,606 =========================================================== =================== ================= See accompanying Notes to Consolidated Financial Statements.
Westmoreland Coal Company and Subsidiaries Consolidated Statements of Income - ---------------------------------------------------------------------------------------------------- (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, 1999 1998 1999 1998 - ------------------------------------------------------ ----------- ----------- ---------- ---------- (in thousands except per share data)
Revenues: Coal $ 11,426 $ 11,383 $ 28,660 $ 34,526 Independent power - equity in earnings 3,283 4,129 29,990 59,548 DTA - equity in earnings (share of losses) (417) (27) (1,135) 218 - ------------------------------------------------------ ----------- ----------- ---------- ---------- 14,292 15,485 57,515 94,292 - ------------------------------------------------------ ----------- ----------- ---------- ---------- Costs and expenses: Cost of sales - coal 9,980 9,771 24,943 29,265 Depreciation, depletion and amortization 327 618 1,071 1,855 Selling and administrative 1,622 1,640 8,399 4,678 Heritage costs 6,440 3,975 18,917 12,079 Pension benefit (55) (53) (165) (158) Doubtful account recoveries (74) (725) (165) (953) - ------------------------------------------------------ ----------- ----------- ---------- ---------- 18,240 15,226 53,000 46,766 Operating income (loss) (3,948) 259 4,515 47,526 Other income (expense): Gains on sales of assets 364 204 433 391 Interest expense (298) (48) (896) (143) Interest income 652 - 1,617 - Minority interest (297) (186) (672) (696) Other income (expense) 293 486 116 1,942 - ------------------------------------------------------ ----------- ----------- ---------- ---------- Income (loss) from operations before reorganization items and income taxes (3,234) 715 5,113 49,020 Reorganization legal and consulting fees - (1,321) - (2,756) Reorganization interest income - 1,102 - 2,430 Income taxes 99 (197) 54 (197) - ------------------------------------------------------ ----------- ----------- ---------- ---------- Income (loss) before cumulative effect of change in accounting principle (3,135) 299 5,167 48,497 Cumulative effect of change in accounting principle - - - (9,876) - ------------------------------------------------------ ----------- ----------- ---------- ---------- Net income (loss) (3,135) 299 5,167 38,621 Less preferred stock dividends (in arrears) (663) (1,222) (1,989) (3,666) - ------------------------------------------------------ ----------- ----------- ---------- ---------- Net income (loss) applicable to common shareholders $ (3,798) $ (923) $ 3,178 $ 34,955 ====================================================== =========== =========== ========== ========== Net income (loss) per share applicable to common shareholders: Before cumulative effect of change in accounting principle $ (.54) $ (.13) $ .45 $ 6.44 Cumulative effect of change in accounting principle - - - (1.42) ====================================================== =========== =========== ========== ========== $ (.54) $ (.13) $ .45 $ 5.02 ====================================================== =========== =========== ========== ========== Weighted average number of common shares outstanding 7,033 6,965 7,033 6,965 ====================================================== =========== =========== ========== ========== See accompanying Notes to Consolidated Financial Statements.
Westmoreland Coal Company and Subsidiaries Consolidated Statements of Cash Flows - ---------------------------------------------------------------------------------------------- (Unaudited) Nine Months Ended September 30, 1999 1998 ------------------------------------------------------------------- ------------ ------------ (in thousands)
Cash flows provided by operating activities: Net income $ 5,167 $ 38,621 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Equity earnings from independent power projects (29,990) (59,548) Cash received from independent power projects 49,545 42,881 Equity in losses from DTA 1,135 (218) Cash generated by DTA 759 1,926 Cash contributions to DTA (1,197) (1,515) Depreciation, depletion and amortization 1,071 1,855 Stock compensation expense 271 - Gain on disposition of assets (433) (391) Minority interest 672 696 Cumulative effect of change in accounting principle - 9,876 Other (861) (1,077) Changes in assets and liabilities: Accounts receivable, net of allowance for doubtful accounts 459 13,128 Workers' compensation bond (614) 1,843 Prepaid pension asset (165) - Excess of trust assets over pneumoconiosis benefit obligation 2,200 - Security deposits (10,148) - Accounts payable and accrued expenses (3,080) (663) Income tax payable (2,110) - Accrual for workers compensation (2,609) - Accrual for postretirement medical costs 6,464 - Consent judgment payment obligation (39,006) - Other liabilities (68) - 1974 UMWA Pension Plan obligations (1,576) - ------------------------------------------------------------------- ------------ ------------ Net cash provided by (used in) operating activities before reorganization items (24,114) 47,414 ------------------------------------------------------------------- ------------ ------------ Changes in reorganization items (6,643) 9,062 ------------------------------------------------------------------- ------------ ------------ Net cash provided by (used in) operating activities (30,757) 56,476 ------------------------------------------------------------------- ------------ ------------ Cash flows provided by (used in) investing activities: Fixed asset additions (1,959) (296) Net proceeds from sales of assets 719 357 ------------------------------------------------------------------- ------------ ------------ Net cash provided by (used in) investing activities (1,240) 61 ------------------------------------------------------------------- ------------ ------------ Cash flows provided by (used in) financing activities: Repayment of long-term debt (211) (47) Purchase of preferred stock (20,000) - Exercise of stock options 66 - ------------------------------------------------------------------- ------------ ------------ Net cash used in financing activities (20,145) (47) ------------------------------------------------------------------- ------------ ------------ Net increase (decrease) in cash and cash equivalents (52,142) 56,490 Cash and cash equivalents, beginning of period 84,073 30,664 =================================================================== ============ ============ Cash and cash equivalents, end of period $ 31,931 $ 87,154 =================================================================== ============ ============ Supplemental disclosures of cash flow information: Cash paid during the period for: Interest $ 5,708 $ 27 Taxes $ 2,110 $ - See accompanying Notes to Consolidated Financial Statements.
WESTMORELAND COAL COMPANY AND SUBSIDIARIES Notes to Consolidated Financial Statements - -------------------------------------------------------------------------------- The Notes contained herein should be read in conjunction with the Notes to the Company's Consolidated Financial Statements filed on Form 10-K/A for the year ended December 31, 1998. The financial information contained in this Form 10-Q is unaudited but reflects all adjustments which are, in the opinion of management, necessary for a fair presentation of the financial information for the periods shown. Such adjustments are of a normal recurring nature. Certain prior year amounts have been reclassified to conform to the current year presentation. 1. Nature of Operations The Company's principal activities, conducted within the United States, are: (i) the production and sale of coal from a contractor-operated mine in the Powder River Basin in Eastern Montana; (ii) the ownership of interests in cogeneration and other non-regulated independent power plants; and (iii) the leasing of capacity at Dominion Terminal Associates, a coal storage and vessel loading facility. Chapter 11 Reorganization Proceedings - ------------------------------------- On December 23, 1996 ("Petition Date"), Westmoreland Coal Company and four subsidiaries, Westmoreland Resources, Inc., Westmoreland Coal Sales Company, Westmoreland Energy, Inc., and Westmoreland Terminal Company (the "Debtor Corporations"), filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Colorado (the "Chapter 11 Cases"). By order of the Bankruptcy Court entered on December 23, 1998, pursuant to the request of the Debtor Corporations, the Chapter 11 Cases were dismissed. There were no objections during the ten day stay period that expired on January 4, 1999. Upon the dismissal, the Debtor Corporations were and are no longer subject to the protections afforded or restrictions imposed by the Bankruptcy Code. 2. Contingencies Westmoreland Energy, Inc. ("WEI") - WEI Project Contingencies - ------------------------------------------------------------- Southampton Project - In October, 1998, the Southampton Partnership and Virginia Power Company ("VEPCO") entered into a settlement agreement of their administrative proceeding before the Federal Energy Regulatory Commission concerning the project's compliance with Qualifying Facility ("QF") criteria and payments arising out of plant performance in 1992. The settlement provided for, among other items, payments by the Southampton Partnership to Virginia Power of $1,000,000 annually for the years 1999-2001, followed by a reduction in capacity payments from Virginia Power to the Southampton Partnership of $500,000 for the years 2002-2008. Following 2008, Virginia Power may elect to terminate its power purchases from the Southampton Partnership or continue to receive the $500,000 annual reduction in capacity payments for the remainder of the power purchase agreement. The settlement was approved by the FERC. Resolution of the FERC QF issue provides the Southampton Partnership an answer about QF status in 1992, regulatory certainty regarding application of the Federal Power Act to both the Southampton project and the upstream partners and owners, including WEI and Westmoreland, and, assuming continued compliance with loan covenants and appropriate project financial performance, the ability to distribute earnings to the project partners. A limited partner of LG&E-Southampton, L.P. made a demand on the Southampton Partnership and related LG&E and Westmoreland entities for reimbursement in the amount of $1,979,000 in connection with its share of the settlement. The Westmoreland entities made a similar demand against the LG&E entities. All parties agreed to attempt to resolve the dispute through non-binding mediation and met with the mediator on October 13 and 14, 1999. During this mediation session the claims of the LG&E-Southampton L.P. limited partner were resolved. The Westmoreland entity agreed to contribute $100,000 of a significantly larger total settlement amount. A second round of mediation talks regarding the Westmoreland claims has been scheduled for early December, 1999. ROVA I Project - WEI owns a 50% partnership interest in Westmoreland-LG&E Partners (the "ROVA Partnership"). The ROVA Partnership's principal customer, Virginia Power, contracted to purchase the electricity generated by ROVA I, one of two units included in the ROVA partnership, under a long-term contract. In the second quarter of 1994, that customer disputed the ROVA Partnership's interpretation of provisions of the contract dealing with the payment of the capacity purchase price when the facility experiences a "forced outage" day. A forced outage day is a day when ROVA I is not able to generate a specified level of electrical output. The ROVA Partnership believes that the customer is required to pay the ROVA Partnership the full capacity purchase price unless forced outage days exceed a contractually stated allowed annual number. The customer asserts that it is not required to do so. From May, 1994, through September, 1999, Virginia Power withheld approximately $19,800,000 of these capacity payments during periods of forced outages. To date, the Company has not recognized any revenue on its 50% portion of the capacity payments being withheld by Virginia Power. In October 1994, the ROVA Partnership commenced litigation against Virginia Power seeking damages, contending that Virginia Power breached the Power Purchase Agreement in withholding such payments. The case was tried beginning on October 26, 1998 in the Circuit Court of the City of Richmond, Virginia. On December 2, 1998, the Court entered judgment in the ROVA Partnership's favor for the amount of $14,800,000 (the amount that Virginia Power had withheld at the trial date) plus interest for a total of $19,336,214. On December 21, 1998, Virginia Power posted its appeal bond and on December 29, 1998, noted its appeal of the Court's decision to the Virginia Supreme Court. The Supreme Court agreed to hear Virginia Power's appeal. Briefs have been submitted. The Company anticipates that the Court will hear Oral Arguments in January, 2000. A decision is expected to follow in 30-60 days. Due to the uncertainty of the appeal, the financial statements do not reflect any portion of this judgment. Rensselaer - On March 15, 1999, LG&E-Westmoreland Rensselaer ("LWR") completed the sale of the Rensselaer Project to Fulton Cogeneration Associates, L.P. ("Fulton"). LWR received approximately $68,000,000 in cash as consideration for the sale of the Rensselaer plant and operating contracts. After payment of expenses and remaining debts, Westmoreland Energy Inc.'s share of the proceeds was approximately $33,000,000. Other - ----- In accordance with a Master Agreement entered into among the Company, the UMWA Health and Benefit Funds, the Official Committee of Equity Security Holders, and the United Mine Workers of America ("UMWA"), pursuant to which the parties supported Westmoreland's dismissal from bankruptcy, the Company agreed to pay "the reasonable and necessary professional fees and expenses of the Equity Committee professionals, Andrews and Kurth, L.L.P. and Putnam Hayes and Bartlett, for services rendered in connection with the Chapter 11 cases". These two firms billed approximately $453,000 and $816,000 for services rendered in the short period between June and December, 1998 in the case of Andrews and Kurth and July and December, 1998 in the case of Putnam Hayes. Moreover, the Settlement Term Sheet among the parties for resolution of the Chapter 11 proceeding was entered in the Court on October 15, 1998. The Company has paid approximately $802,000 of these fees, but believes that the balance (approximately $466,000) reflects services that did not and were not reasonably expected to benefit the estate and may have been performed in preparation for the proxy contest that took place after the bankruptcy ended. This amount has been disputed and not paid. On April 7, 1999, Andrews & Kurth, L.L.P. and Putnam Hayes and Bartlett filed suit in District court in the State of Colorado seeking payment of the amounts allegedly owed. The Company believes the charges were not reasonable and necessary in accordance with the Bankruptcy Code and the Master Agreement and will vigorously contest the case. The parties have agreed to attempt to resolve the dispute through mediation. If that is not successful, the case is scheduled for trial commencing May 15, 2000. The likely outcome of the dispute is unknown at this time. The Company has accrued the entire amount demanded. 3. Capital Stock Preferred stock dividends at a rate of 8.5% per annum were paid quarterly from the third quarter of 1992 through the first quarter of 1994. The declaration and payment of preferred stock dividends was suspended in the second quarter of 1994 in connection with extension agreements with the Company's principal lenders. Upon the expiration of these extension agreements, the Company paid a quarterly dividend on April 1, 1995 and July 1, 1995. Pursuant to the requirements of Delaware law, described below, the preferred stock dividend was suspended in the third quarter of 1995 as a result of recognition of losses and the subsequent shareholders' deficit. The twenty quarterly dividends which are accumulated but unpaid (dividend payment dates July 1, 1994, October 1, 1994, January 1, 1995, October 1, 1995, January 1, 1996, April 1, 1996, July 1, 1996, October 1, 1996, January 1, 1997, April 1, 1997, July 1, 1997, October 1, 1997, January 1, 1998, April 1, 1998, July 1, 1998, October 1, 1998, January 1, 1999, April 1, 1999, July 1, 1999, and October 1, 1999) amount to $13,253,000 in the aggregate ($42.50 per preferred share or $10.63 per depositary share). Common stock dividends may not be declared until the preferred stock dividends that are accumulated but unpaid are made current. On March 10, 1999, the Company offered to purchase up to 1,052,631 depositary shares, each representing one quarter of a share of its Series A Convertible Exchangeable Preferred Stock ("Series A Preferred Stock"). The offer price of $19 per share was in full satisfaction of claims to accumulated but unpaid dividends on the depositary shares tendered. On April 7, 1999, the offer expired and 1,683,903 depositary shares were tendered in response to the offer. Because the number of shares tendered exceeded the maximum number of shares the Company had offered to purchase, a proration factor of approximately 62.5% was applied to all shares tendered. A total of 1,052,631 depositary shares were purchased for $20,000,000. The balance sheet effect of this transaction was to reduce cash and shareholders' equity by $20,000,000. Following completion of the tender offer, the depositary shares purchased in the offer were converted into shares of Series A Preferred Stock, the shares of Series A Preferred Stock were retired, and the capital of the Company was reduced by the par value of the shares of Series A Preferred Stock retired. This reduced the number of shares of Series A Preferred Stock outstanding from 575,000 to 311,843, accumulated but unpaid dividends from $21,994,000 to $11,928,000, and the ongoing quarterly preferred dividend requirement from $1,222,000 to $663,000. On September 16, 1999, the Company made a second offer to purchase up to an additional 631,000 depositary shares at $19 per depositary share. The offer price of $19 per share was in full satisfaction of claims to accumulated but unpaid dividends on the depositary shares tendered. On October 26, 1999, the offer expired and 412,536 depositary shares were tendered in response to the offer. The balance sheet effect of the transaction will be to reduce cash and shareholders' equity by $7,838,000. Following completion of the tender offer, the depositary shares purchased in the offer will be converted to shares of Series A Preferred Stock, the shares of Series A Preferred Stock will be retired, and the capital of the Company will be reduced by the par value of the shares of Series A Preferred Stock retired. This will reduce the number of shares of Series A Preferred Stock outstanding from 311,843 to 208,709, accumulated but unpaid dividends from $13,253,000 to $8,870,000 and the ongoing quarterly dividend requirement from $663,000 to $444,000. There are statutory restrictions limiting the payment of preferred stock dividends under Delaware law, the state in which the Company is incorporated. Under Delaware law, the Company is permitted to pay preferred stock dividends only: (1) out of surplus, surplus being the amount of shareholders' equity in excess of the par value of the Company's two classes of stock; or (2) in the event there is no surplus, out of net profits for the fiscal year in which a preferred stock dividend is declared (and/or out of net profits from the preceding fiscal year), but only to the extent that shareholders' equity exceeds the par value of the preferred stock ($312,000 at September 30, 1999). The Company had shareholders' equity at September 30, 1999 of $7,401,000 and the par value of all outstanding depositary shares and shares of common stock aggregated $17,961,000 at September 30, 1999. 4. DISPOSITION On July 27, 1999, the Company sold all remaining assets of its idled Virginia Division. The assets consisted of the Bullitt Preparation Plant and Transloader Complex. The Company received approximately $650,000 in cash and the purchaser assumed reclamation liabilities of approximately $600,000. The transaction resulted in a net gain of approximately $360,000. The Company continues in its efforts to sell the Virginia Division refuse site. The site has no recorded asset value. 5. BUSINESS SEGMENT INFORMATION The Company's operations have been classified into three segments: coal, independent power operations and terminal operations. The coal segment includes the production and sale of coal from the Powder River Basin in eastern Montana. The independent power operations segment includes the ownership of interests in cogeneration and other non-regulated independent power plants. The terminal operation segment consists of the leasing of capacity at Dominion Terminal Associates, a coal storage and vessel loading facility. The Corporate classification noted in the tables represents all costs not otherwise classified including corporate office charges, heritage costs, and all residual costs of the idled Virginia Division. Summarized financial information by segment for the quarter and nine months ended September 30, 1999 and 1998, is as follows: ------------------------------------ -- -------------- ----------------- ---------------- --------------- ---------------- Independent Terminal Coal Power Operations Operations Corporate Total ------------------------------------ -- -------------- ----------------- ---------------- --------------- ---------------- (in thousands)
Three months ended September 30, 1999: Total assets $ 60,492 $ 55,216 $ 5,243 $ 31,395 $ 152,346 Revenues 11,426 3,283 (417) - 14,292 Operating income (loss) 1,002 3,515 (711) (7,754) (3,948) Reconciliation of operating income to income from operations before income taxes: Operating income (loss) 1,002 3,515 (711) (7,754) (3,948) Gains on sale of assets - - - 364 364 Interest expense (36) - - (262) (298) Interest income 192 122 6 332 652 Minority interest (297) - - - (297) Other income (expense) (12) (265) (114) 684 293 ==================================== == ============== ================= ================ =============== ================ Income (loss) from operations before income taxes $ 849 $ 3,372 $ (819) $ (7,636) $ (3,234) ==================================== == ============== ================= ================ =============== ================ Three months ended September 30, 1998: Total assets $ 58,269 $ 119,921 $ 19,482 $ 31,859 $ 229,531 Revenues 11,383 4,129 (27) - 15,485 Operating income (loss) 586 4,765 (123) (4,969) 259 Reconciliation of operating income to income from operations before income taxes: Operating income (loss) 586 4,765 (123) (4,969) 259 Gains on sale of assets - - - 204 204 Interest expense (41) - - (7) (48) Interest income 182 686 5 229 1,102 Minority interest (186) - - - (186) Other income (expense) 2 (954) (24) 1,462 486 Reorganization costs - - - (1,321) (1,321) ------------------------------------ -- -------------- ----------------- ---------------- --------------- ---------------- Income (loss) from operations before income taxes $ 543 $ 4,497 $ (142) $ (4,402) $ 496 ==================================== == ============== ================= ================ =============== ================
------------------------------------ -- -------------- ----------------- ---------------- --------------- ---------------- Independent Terminal Coal Power Operations Operations Corporate Total ------------------------------------ -- -------------- ----------------- ---------------- --------------- ---------------- (in thousands)
Nine months ended September 30, 1999: Total assets $ 60,492 $ 55,216 $ 5,243 $ 31,395 $ 152,346 Revenues 28,660 29,990 (1,135) - 57,515 Operating income (loss) 2,310 28,881 (1,214) (25,462) 4,515 Reconciliation of operating income to income from operations before income taxes: Operating income (loss) 2,310 28,881 (1,214) (25,462) 4,515 Gains on sale of assets - - - 433 433 Interest expense (108) - - (788) (896) Interest income 484 412 30 691 1,617 Minority interest (672) - - - (672) Other income (expense) 9 (767) - 874 116 ==================================== == ============== ================= ================ =============== ================ Income (loss) from operations before income taxes $ 2,023 $ 8,526 $ (1,184) $ (25,252) $ 5,113 ==================================== == ============== ================= ================ =============== ================ Nine months ended September 30, 1998: Total assets $ 58,269 $ 119,921 $ 19,482 $ 31,859 $ 229,531 Revenues 34,526 59,548 218 - 94,292 Operating income (loss) 2,485 58,951 (850) (13,060) 47,526 Reconciliation of operating income to income from operations before income taxes: Operating income (loss) 2,485 58,951 (850) (13,060) 47,526 Gains on sale of assets - - - 391 391 Interest expense (123) - - (20) (143) Interest income 501 1,180 54 695 2,430 Minority interest (696) - - - (696) Other income (expense) 22 (954) - 2,874 1,942 Reorganization costs - - - (2,756) (2,756) ==================================== == ============== ================= ================ =============== ================ Income (loss) from operations before income taxes $ 2,189 $ 59,177 $ (796) $ (11,876) $ 48,694 ==================================== == ============== ================= ================ =============== ================
Item 2 - -------------------------------------------------------------------------------- Management's Discussion and Analysis of Financial Condition and Results of Operations Material Changes in Financial Condition From December 31, 1998 to September 30, 1999 Forward-Looking Disclaimer Certain statements in this report which are not historical facts or information are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, but not limited to, the information set forth in Management's Discussion and Analysis of Financial Condition and Results of Operations. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, levels of activity, performance or achievements of the Company, or industry results, to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: general economic and business conditions; the ability of the Company to implement its business strategy; the Company's access to financing; the Company's ability to successfully identify new business opportunities; the Company's ability to achieve anticipated cost savings and profitability targets; changes in the industry; competition; the Company's ability to utilize its tax net operating losses; the ability to reinvest excess cash at an acceptable rate of return; weather conditions; the availability of transportation; price of alternative fuels; costs of coal produced by other countries; the effect of regulatory and legal proceedings and other factors discussed in Item 1 of the Company's Form 10-K. As a result of the foregoing and other factors, no assurance can be given as to the future results and achievement of the Company. Neither the Company nor any other person assumes responsibility for the accuracy and completeness of these statements. Bankruptcy Proceeding Westmoreland Coal Company and four subsidiaries, Westmoreland Resources, Inc., Westmoreland Coal Sales Company, Westmoreland Energy, Inc., and Westmoreland Terminal Company ("the Debtor Corporations"), filed voluntary petitions for protection under Chapter 11 of the Bankruptcy Code on December 23, 1996. On December 23, 1998, the Bankruptcy Court granted the Debtors' Motion to Dismiss the cases. The automatic stay period pursuant to the Federal Rules of Bankruptcy Procedure expired on January 4, 1999. Continued financial improvement of the Debtors during the bankruptcy provided the basis for dismissal and settlement with the UMWA Health and Benefit Funds ("Funds"), the Company's principal creditors. On October 15, 1998, the Company, the Funds, the United Mine Workers of America ("UMWA") and the Official Committee of Equity Security Holders ("Equity Committee") reached agreement on a settlement term sheet, which contained the principal terms of an agreement among them and provided for, among other things, the resolution of the Chapter 11 cases. The agreement, which facilitated a consensual dismissal of the bankruptcy cases, was announced during scheduled hearings on Westmoreland's Motion to Dismiss and the Equity Committee's Motion to Convert to Chapter 7, and the hearings were subsequently recessed. The agreement was subsequently documented in certain stipulated judgments and in a Master Agreement among the Company, the Funds, the UMWA, and the Equity Committee. On October 30, 1998, the Debtor Corporations, the Funds, the UMWA, and the Equity Committee filed a joint motion with the Bankruptcy Court, setting forth the outline of a procedure for dismissal of the Chapter 11 Cases combined with the entry of "consent judgments" in connection with certain of the pending litigation. The Debtor Corporations filed motions requesting approval of the consent judgments on or around November 18, 1998. Notices of the filing of these motions were mailed to creditors as directed by the Bankruptcy Court. There were no allowable objections and dismissal of the Chapter 11 Cases occurred on December 23, 1998. The Master Agreement was executed on January 29, 1999. Liquidity and Capital Resources Cash used in operating activities was $30,757,000 for the nine months ended September 30, 1999. Cash provided by operating activities was $56,476,000 for the nine months ended September 30, 1998. The decrease in cash from operations in 1999 compared to 1998 is mainly due to cash received from the Rensselaer restructuring at WEI and the termination of the salaried pension plan in 1998, as well as the payment of pre-petition liabilities and reorganization costs and the funding of security deposits in 1999. Equity in the earnings of Rensselaer, net of restructuring revenues, was approximately $2,700,000 in 1998. Cash used in investing activities was $1,240,000 for the nine months ended September 30, 1999. Cash provided by investing activities for the nine months ended September 30, 1998 was $61,000. Cash used in investing activities in 1999 included fixed asset additions of $1,959,000 at WRI offset by proceeds from sales of assets of $719,000. Cash provided by investing activities in 1998 of $61,000 included $357,000 of proceeds from sales of assets offset by fixed asset additions at WRI of $296,000. Cash used in financing activities for the nine months ended September 30, 1999 and 1998 totaled $20,145,000 and $47,000, respectively. Cash used in financing activities in 1999 related primarily to the purchase of preferred stock. Consolidated cash and cash equivalents at September 30, 1999 totaled $31,931,000 (including $15,438,000 at WRI). At December 31, 1998, cash and cash equivalents totaled $84,073,000 (including $14,712,000 at WRI). The cash at WRI, an 80%-owned subsidiary, is available to the Company only through dividends. In addition, the Company had restricted cash, which was not classified as cash or cash equivalents, of $14,902,000 at September 30, 1999 and $4,140,000 at December 31, 1998. The restricted cash represents interest-bearing cash deposit accounts which collateralize the Company's Contingent Note ($6,000,000) required by the Master Agreement and the surety bond for the security required by the 1992 UMWA Benefit Plan ($4,148,000), as well as $4,754,000 that collateralizes the outstanding surety bonds for its workers compensation self-insurance programs. The restricted cash in 1998 represents collateral for the outstanding surety bonds for its workers compensation self-insurance programs. The Company also has $8,000,000 in interest-bearing debt reserve accounts for certain of the Company's independent power projects. This cash is restricted as to its use and is classified as part of the investment in independent power projects. In addition, there is a surplus in the Company's pneumoconiosis trust of approximately $8,691,000, that may be available to pay postretirement health benefits dependent upon future actuarial calculations as well as $3,900,000 of excess funds in the salaried pension plan. Preferred stock dividends at a rate of 8.5% per annum were paid quarterly from the third quarter of 1992 through the first quarter of 1994. The declaration and payment of preferred stock dividends was suspended in the second quarter of 1994 in connection with extension agreements entered into with the Company's principal lenders. Upon the expiration of these extension agreements, the Company paid a quarterly dividend on April 1, 1995 and July 1, 1995. Pursuant to Delaware law, the preferred stock dividend was suspended in the third quarter of 1995 as a result of the recognition of losses related to the idling of the Virginia division and the resulting shareholders' deficit. The twenty quarterly dividends which are in arrears (those dividends whose payment dates would have been July 1, 1994, October 1, 1994, January 1, 1995, October 1, 1995, January 1, 1996, April 1, 1996, July 1, 1996, October 1, 1996, January 1, 1997, April 1, 1997, July 1, 1997, October 1, 1997, January 1, 1998, April 1, 1998 and July 1, 1998, October 1998, January 1, 1999, April 1, 1999, July 1, 1999, and October 1, 1999) amount to $13,253,000 in the aggregate ($42.50 per preferred share or $10.63 per depositary share). As described in Note 3 of Notes to Consolidated Financial Statements, this amount of accrued but unpaid dividends decreased after September 30, 1999 as a result of the second offer to purchase which expired on October 26, 1999. There are statutory restrictions limiting the payment of preferred stock dividends under Delaware law, the state in which the Company is incorporated. Under Delaware law, the Company is permitted to pay preferred stock dividends only: (1) out of surplus, surplus being the amount of shareholders' equity in excess of the par value of the Company's two classes of stock; or (2) in the event there is no surplus, out of net profits for the fiscal year in which a preferred stock dividend is declared (and/or out of net profits for the preceding fiscal year), but only to the extent that shareholders' equity exceeds the par value of the preferred stock ($312,000 at September 30, 1999). The Company had shareholders' equity at September 30, 1999 of $7,401,000 and the par value of all outstanding depositary shares and shares of common stock aggregated $17,961,000 at September 30, 1999. Liquidity Outlook The major factors impacting the Company's liquidity outlook are its significant "heritage costs" and its ongoing and future business needs. These heritage costs consist primarily of cash payments for postretirement medical benefits, workers' compensation costs and UMWA pension benefits. The Company also is obligated for pension and pneumoconiosis benefits; however, both of these future obligations have a funding surplus at present. The Company has ongoing cash expenditures of approximately $16,000,000 per year for postretirement medical benefits which will remain fairly constant over the next five years and then decline to zero over the next approximately thirty-seven years. In addition, the Company has cash expenditures of approximately $3,000,000 per year for workers' compensation benefits which will steadily decline to zero over the next approximately twenty years. Since the UMWA pension plan is a multiemployer plan under ERISA, a contributing company is liable for its share of unfunded vested liabilities upon termination or withdrawal from the plan. The Company believes the plan was fully funded at the time of the Company's withdrawal in 1998. However, the plan has asserted a claim of $13,800,000, which the Company vigorously contests. The Company is contesting this amount through arbitration, as provided under ERISA. In accordance with the Multiemployer Pension Plan Amendments Act of 1980, the Company has made monthly principal and interest payments to the plan while it pursues its rights and will continue to make such monthly payments until arbitration is completed. Included in the payments made in 1999 was interest of approximately $785,000. Depending upon the results of arbitration, the Company may be entitled to a refund or it could be required to pay any remaining obligation over no more than nine and one-half years. Under the Coal Act, the Company is required to provide postretirement medical benefits for UMWA miners by making payments into three benefit plans: (i) premiums to the UMWA Combined Benefit Fund (the "Combined Fund"), a multiemployer plan which benefits miners who retired before January 1, 1976 or who retired thereafter but whose last employer did not provide benefits pursuant to an operator-specific Individual Employer Plan ("IEP"), (ii) payments to maintain an IEP for miners who retired after January 1, 1976 and (iii) premiums to the 1992 UMWA Benefit Plan, a multiemployer plan which benefits (A) miners who were eligible to retire on February 1, 1993, who did retire on or before September 30, 1994 and whose former employers are no longer in business, (B) miners receiving benefits under an IEP whose former employer has gone out of business and ceased to maintain the IEP, and (C) new spouses or new dependents of retirees in the Combined Fund who would be eligible for coverage thereunder but for the fact that the Combined Fund closed to new beneficiaries as of July 20, 1992. The premiums paid by the Company cover its own retirees and its allocated portion of the pool of retired miners whose previous employers have gone out of business. The Company, on January 4, 1999, as a result of its improved financial position and subsequent dismissal from bankruptcy, satisfied all of its premium obligations to the Combined Fund through the end of 1998, and made prepayments to the Combined Fund for its premiums for the first three quarters of 1999. Normal monthly payments resumed on October 25, 1999. Beginning on that date, the Company began receiving credits against its Combined Fund premiums at a rate of approximately $200,000 per month through April, 2000, for a total of $1,400,000. This credit is the result of a recalculation of premiums by the Combined Fund pursuant to an order of the U.S. District Court for the Northern District of Alabama entered July 20, 1995 in National Coal Association v. Chater. Faced with an impending solvency crisis as a result of benefit expenses exceeding premiums, the Combined Benefit Fund has sought relief from Congress. Under sponsorship of Senators Byrd and Rockefeller of West Virginia, the House and Senate conference committee approved, as part of the Interior and Related Agencies appropriations bill, a further transfer of $68,000,000 of accumulated interest in the Abandoned Mine Land Reclamation Fund to the Combined Fund. This bill has been forwarded to the President. However, the Interior bill along with several other appropriations bills have not been signed by the President due to differences over a number of issues. The AML transfer does not appear to be one of the disputed issues. As part of its report, the conference committee noted that this was a short term solution and urged that the Congressional committees with jurisdiction over the matter work with the concerned parties to insure the long term solvency of the Combined Fund. One concept that has been discussed within the industry would be to cause Medicare to cover the cost of prescription drug benefits for eligible retirees. In addition, the Coal Act authorized the Trustees of the 1992 UMWA Benefit Plan to implement security provisions for three years benefits pursuant to the Act. In 1995, the Trustees set the level of security to be provided by the Company. In 1999, the Company secured its obligation to provide retiree health benefits under the 1992 Plan by posting a bond in the amount of three years benefits (or $22.7 million). The bond is collateralized by U.S. Government-backed securities. The amount to be secured and the bond amount will be reviewed and adjusted on an annual basis. The Company's current principal sources of cash flow include cash distributions from its independent power projects, dividends from WRI, and interest earned on its cash reserves. In addition, the Company will receive its share of the judgment in the ROVA litigation if VEPCO's appeal to the Virginia Supreme Court is unsuccessful. Distributions from the overfunded pneumoconiosis trust to pay post retirement health benefits are also possible depending on future actuarial calculations. Management believes that cash generated from these sources and cash reserves should be sufficient to pay the Company's heritage costs and fund its ongoing operations and other capital requirements for the foreseeable future. Capital commitments included $4,200,000 to repair the dragline at WRI. Approximately $2,000,000 was expended in 1998 with the majority of the remainder expended by June 30, 1999. The Company has paid for the repair to assure continued, uninterrupted production at WRI, but the Company believes the obligation to repair the dragline is solely Morrison-Knudsen's and, therefore, is in discussion with them on this and other matters, including enforcement of the Company's right to require Morrison-Knudsen to pay for the repair. The Company is subject to certain financial ratio tests under the terms of the Master Agreement. The Company agreed to secure its obligations under the Master Agreement by providing a Contingent Promissory Note ("Note"). The original principal amount of the Note is $12 million; the principal amount of the Note decreases to $6 million in 2002. The Note is payable only in the event the Company does not meet its Coal Act obligations, fails to meet certain ongoing financial tests specified in the Note, fails to maintain the required balance in the escrow account established under an escrow agreement or fails to comply with certain covenants set forth in a security agreement. The Company hopes to further improve its long-term liquidity in a number of ways, including the development of additional cash flow from existing and new business operations and monetizing assets where proceeds on sale would exceed the expected return from continued operation. The Company also plans to seek further cost reductions wherever feasible and prudent, and will attempt to reduce certain postretirement medical, workers' compensation and related payments. The Company is also monitoring certain legislative developments which could reduce the Company's retiree health care expenses. Although management expects to improve the Company's profitability, the time required to realize such improvements cannot be estimated at this time nor can assurances be given that the Company can achieve any such improvements. Year 2000 The Year 2000 ("Y2K") problem concerns the inability of information and technology-based operating systems to properly recognize and process date-sensitive information beyond December 31, 1999. This could result in systems failures and miscalculations which could cause business disruptions. Equipment that uses a date, such as computers and operating control systems, may be affected. This includes equipment used by our customers and suppliers, as well as the Company's independent power projects. Most of the Company's systems and related software are already Y2K compliant. The Company has actively reviewed all hardware and software associated with its computers, personal computers and client/servers, telecommunications and embedded systems found in equipment throughout its operations. This program consists of identifying and inventorying all software applications and systems, making required replacements, modifications, and testing. All of the independent power projects have completed Y2K testing. The projects operated normally with only minor errors in the reporting process. Computer systems at WRI and its mining contractor have been replaced or appropriately modified. WRI's rail supplier has virtually completed an aggressive campaign to bring its systems into compliance. Compliance at Dominion Terminal Associates ("DTA") has been completed through replacement of non-compliant systems. The terminal is dependent on efficient and timely rail service and DTA is closely monitoring the compliance efforts of the terminal's rail service providers. The nature of the Company's operations make substantive contingency plans extremely difficult. No reasonable alternatives exist for the inability of the railroads to provide timely service to WRI and the DTA terminal. As previously mentioned, the Company is closely following the compliance efforts of the railroads and other major suppliers. Based on information currently available, it is estimated that the costs to replace and modify Company systems to achieve Y2K compliance will not exceed $60,000, of which approximately $38,000 has been incurred through September 30, 1999. While there can be no assurance that all modifications and contingency plans to date will be successful, the Company does not expect that any disruptions will have a material adverse effect on its overall financial position, results of operations, or liquidity. The foregoing constitutes a "forward-looking statement" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. It is based on management's current expectations, estimates and projections, which could ultimately prove to be inaccurate. Factors which could affect the Company's ability to be Y2K compliant by the end of 1999 include the failure of customers, suppliers, governmental entities and others to achieve compliance and the inaccuracy of certifications received from them. RESULTS OF OPERATIONS - -------------------------------------------------------------------------------- Quarter Ended September 30, 1999 Compared to Quarter Ended September 30, 1998. Revenues for the quarter ending September 30, 1999 were $14,292,000 compared to $15,485,000 for the quarter ending September 30, 1998. The decrease is due to lower equity in earnings at WEI due to the sale of the Rensselaer facility early in 1999 and decreased earnings from terminal operations due to a decline in the export market. Costs and expenses for the quarter ending September 30, 1999 were $18,240,000 compared to $15,226,000 for the quarter ending September 30, 1998. The majority of the increase is due to an increase in the accrual for heritage costs. Upon the termination of the bankruptcy, the Company was required to resume monthly payments of approximately $500,000 to the Combined Benefit Fund. In addition, there was approximately $450,000 in market-related adjustments to the Black Lung Trust due to fluctuations in the assets of the bond portfolio that satisfies the Black Lung obligation. Sales volumes at WRI have decreased slightly, decreasing costs and expenses accordingly. Gains on the sales of assets were $364,000 during the quarter ending September 30, 1999, compared to $204,000 for the quarter ending September 30, 1998. The gains relate primarily to sales of various assets from the Company's idled Virginia Division. Interest expense was $298,000 and $48,000 for the three months ended September 30, 1999 and 1998, respectively. The increase is due to interest on installment payments being made monthly to the 1974 UMWA Pension Plan pending resolution of the Company's arbitration proceeding with the Plan. Interest income was $652,000 for the three months ended September 30, 1999. Interest income of $1,102,000 in 1998 was recorded as a reorganization item. Nine Months Ended September 30, 1999 Compared to Nine Months Ended September 30, 1998. Revenues for the nine months ended September 30, 1999 were $57,515,000 compared to $94,292,000 for the nine months ended September 30, 1998. The decrease is mainly due to elevated 1998 earnings as a result of the restructuring of the power purchase contract at WEI's Renssalaer project with Niagara Mohawk and reduced 1999 sales volumes at WRI and DTA. Costs and expenses for the nine months ended September 30, 1999 were $53,000,000 compared to $46,766,000 for the nine months ended September 30, 1998. The majority of the increase is due to an increase in the accrual for heritage costs. Upon the termination of the bankruptcy the Company was required to resume monthly payments of approximately $500,000 to the Combined Benefit Fund. In addition there was approximately $2,700,000 in Workers Compensation expense and market related adjustments to the Black Lung Trust due to fluctuations in the assets of the bond portfolio that satisfies the Black Lung obligation. Sales volumes at WRI have decreased, decreasing costs and expenses accordingly. Selling and administrative costs increased in 1999 as a result of approximately $3,900,000 in final bankruptcy, proxy contest and tender offer expenses along with employee bonuses paid following the Company's dismissal from bankruptcy. Interest expense was $896,000 and $143,000 for the nine months ended September 30, 1999 and 1998, respectively. The increase is due to interest on installment payments being made monthly to the 1974 UMWA Pension Plan pending resolution of the Company's arbitration proceeding with the Plan. Interest income was $1,617,000 for the nine months ended September 30, 1999. Interest income of $2,430,000 in 1998 was recorded as a reorganization item. The decrease is due to the reduced cash balance that resulted from pre-petition payments made on January 4,1999 following the Company's dismissal from bankruptcy. Other income was $116,000 and $1,942,000 for the nine months ended September 30, 1999 and 1998, respectively. The 1998 period included income relating to a production tax holdback of $650,000 and to a $750,000 buyout of a royalty agreement from a former contract miner. PART II - OTHER INFORMATION ITEM 1 LEGAL PROCEEDINGS - -------------------------------------------------------------------------------- See Note 1 "Chapter 11 Reorganization Proceedings" and Note 2 "Contingencies" of Notes to Consolidated Financial Statements, which are incorporated by reference herein. ITEM 3 DEFAULTS UPON SENIOR SECURITIES - -------------------------------------------------------------------------------- See Note 3 "Capital Stock" of Notes to Consolidated Financial Statements, which is incorporated by reference herein. Item 6 Exhibits and Reports on Form 8-K - -------------------------------------------------------------------------------- a) Exhibit 27 - Financial Data Schedule On July 1, 1999, the Company filed a report on Form 8-K announcing that it expects to conduct an additional tender offer at $19 per depositary share for approximately 600,000 shares. On July 28, 1999, the Company filed a report on Form 8-K announcing the sale of its Bullitt preparation plant and transloader complex to Mountain, LLC for approximately $650,000 in cash and the assumption $600,000 of associated reclamation liabilities. On October 27, 1999 the Company filed a report on Form 8-K announcing the results of its tender offer to purchase up to 631,000 shares of its depositary shares. 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. WESTMORELAND COAL COMPANY Date: November 15, 1999 /s/ Robert J. Jaeger --------------------------------------- Robert J. Jaeger Senior Vice President - Finance and Treasurer /s/ Larry W. Mikkola --------------------------------------- Larry W. Mikkola Controller EX-27 2
5 1,000 9-MOS DEC-31-1999 SEP-30-1999 31,931 0 5,337 0 0 38,764 76,697 39,743 152,346 24,085 0 0 312 17,649 (10,560) 152,346 57,515 57,515 24,943 53,000 1,494 0 896 5,113 54 5,167 0 0 0 5,167 .45 .45
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