-----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, EMFLsciyFeOAyov/MAfV48B/+qtytUneSAl/Gl58swpNGXwOzQh1+jIvcQTQz+WW aB2cVju/mW269izW2XXAcA== 0000912057-97-020428.txt : 19970617 0000912057-97-020428.hdr.sgml : 19970617 ACCESSION NUMBER: 0000912057-97-020428 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970430 FILED AS OF DATE: 19970616 SROS: NYSE SROS: PSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DRESSER INDUSTRIES INC /DE/ CENTRAL INDEX KEY: 0000030099 STANDARD INDUSTRIAL CLASSIFICATION: ENGINES & TURBINES [3510] IRS NUMBER: 750813641 STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-04003 FILM NUMBER: 97624676 BUSINESS ADDRESS: STREET 1: 2001 ROSS AVE CITY: DALLAS STATE: TX ZIP: 75201 BUSINESS PHONE: 2147406000 MAIL ADDRESS: STREET 1: P O BOX 718 CITY: DALLAS STATE: TX ZIP: 75221 10-Q 1 FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) [X] Quarterly report pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934 for the quarterly period ended April 30, 1997. --------------- [ ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Commission file number 1-4003 ------ DRESSER INDUSTRIES, INC. - ------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware C 75-0813641 - ------------------------------- ------------------- (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) P. O. Box 718 2001 Ross 75221 (P. O. Box) Dallas, Texas 75201 - ------------------------------- ------------------- (Address of principal executive (Zip Code) offices) Registrant's telephone number, including area code - 214-740-6000 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, 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 the latest practicable date. Class Outstanding at May 31, 1997 - ---------------------------- --------------------------- Common Stock, par value $.25 175,098,668 1 INDEX Page Number ------ Part I. Financial Information Management's Representation 3 Condensed Consolidated Statements of Earnings for the three months and six months ended April 30, 1997 and 1996 4 Condensed Consolidated Balance Sheets as of April 30, 1997 and October 31, 1996 5 Condensed Consolidated Statements of Cash Flows for the six months ended April 30, 1997 and 1996 6 Notes to Condensed Consolidated Financial Statements 7-11 Management's Discussion and Analysis of Financial Condition and Results of Operations 12-15 Part II. Other Information 16 Signature 17 Exhibit Index Exhibit 27 Financial Data Schedule 2 MANAGEMENT'S REPRESENTATION The condensed consolidated financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. The Company believes that the disclosures are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements, the notes to consolidated financial statements and management's discussion and analysis included in the Company's 1996 Annual Report on Form 10-K. In the opinion of the Company, all adjustments have been included that were necessary to present fairly the financial position of Dresser Industries, Inc. and subsidiaries as of April 30, 1997 and October 31, 1996, the results of operations for the three months and the six months ended April 30, 1997 and 1996, and cash flows for the six months ended April 30, 1997 and 1996. These adjustments consisted of normal recurring adjustments. The results of operations for such interim periods do not necessarily indicate the results for the full year. 3 DRESSER INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (In Millions Except Per Share Data) Three Months Ended Six Months Ended April 30, April 30, -------------------- -------------------- 1997 1996 1997 1996 --------- --------- --------- --------- (Unaudited) (Unaudited) Revenues $ 1,771.3 $ 1,629.6 $ 3,475.8 $ 3,092.5 Cost of revenues (1,364.6) (1,279.8) (2,707.3) (2,422.3) --------- --------- --------- --------- Gross earnings 406.7 349.8 768.5 670.2 Selling, engineering, admini- strative and general expenses (267.1) (242.9) (525.1) (480.1) Other income (deductions) Interest expense, net (15.2) (10.9) (30.0) (20.9) Other, net (.5) (4.1) (2.7) (4.4) --------- --------- --------- --------- Earnings before items below 123.9 91.9 210.7 164.8 Income taxes (43.4) (31.2) (73.8) (56.0) Minority interest (5.7) (3.5) (10.0) (5.0) --------- --------- --------- --------- Net Earnings 74.8 57.2 126.9 103.8 --------- --------- --------- --------- --------- --------- --------- --------- Earnings per common share $ .42 $ .31 $ .72 $ .57 Cash dividends per common share $ .17 $ .17 $ .34 $ .34 Average common shares outstanding 176.2 181.2 176.0 181.5 See accompanying Notes to Condensed Consolidated Financial Statements. 4 DRESSER INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In Millions) April 30, October 31, ASSETS 1997 1996 --------- --------- (Unaudited) Current Assets Cash and cash equivalents $ 144.0 $ 232.4 Notes and accounts receivable, net 1,146.5 1,152.1 Inventories, net 942.0 913.6 Deferred income taxes 83.8 83.8 Other current assets 81.1 87.6 --------- --------- Total Current Assets 2,397.4 2,469.5 Investments in and receivables from unconsolidated affiliates 178.5 182.5 Goodwill, net 857.9 870.6 Deferred income taxes 185.2 184.0 Other assets 200.7 181.2 Property, plant and equipment - at cost 2,878.3 2,836.7 Accumulated depreciation and amortization 1,643.4 1,574.3 --------- --------- Total properties, net 1,234.9 1,262.4 --------- --------- Total Assets $5,054.6 $5,150.2 --------- --------- --------- --------- LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Short-term debt $ 112.6 $ 86.0 Accounts payable 490.8 570.6 Contract advances 456.8 459.8 Accrued compensation and benefits 253.8 250.4 Income taxes 112.8 111.3 Other current liabilities 321.0 383.7 -------- -------- Total Current Liabilities 1,747.8 1,861.8 Employee retirement and postemployment benefit obligations 656.8 676.3 Long-term debt 754.8 756.3 Deferred compensation, insurance reserves and other liabilities 120.1 118.0 Minority interest 161.6 155.6 Shareholders' Equity Common shares 46.2 46.2 Capital in excess of par value 451.8 454.8 Retained earnings 1,487.9 1,420.8 Cumulative translation adjustments (109.6) (81.5) Pension liability adjustment (6.9) (6.9) -------- -------- 1,869.4 1,833.4 Less treasury shares, at cost 255.9 251.2 -------- -------- Total Shareholders' Equity 1,613.5 1,582.2 -------- -------- Total Liabilities and Shareholders' Equity $5,054.6 $5,150.2 -------- -------- -------- -------- Actual common shares outstanding 175.6 175.6 See accompanying Notes to Condensed Consolidated Financial Statements. 5 DRESSER INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In Millions) Six Months Ended April 30, ------------------------ 1997 1996 ---- ---- (Unaudited) Cash flows from operating activities: Net earnings $ 126.9 $ 103.8 Adjustments to reconcile net earnings to cash flow: Depreciation and amortization 126.1 108.2 Equity earnings from unconsolidated affiliates (19.1) (13.8) Minority interest 10.0 5.0 Changes in working capital (190.9) (151.5) Other - net (4.6) (2.6) ------- ------- Net cash provided by operating activities 48.4 49.1 ------- ------- Cash flows from investing activities: Capital expenditures (114.6) (153.2) Business acquisitions (3.6) (18.0) Proceeds from sales of assets 24.1 11.7 ------- ------- Net cash used by investing activities (94.1) (159.5) ------- ------- Cash flows from financing activities: Dividends paid (59.8) (61.8) Purchases of common shares for Treasury (19.0) (74.4) Issuance of common shares 9.2 17.3 Increase in short-term debt 26.5 176.9 (Decrease) Increase in long-term debt (1.5) 2.6 ------- ------- Net cash (used) provided by financing activities (44.6) 60.6 ------- ------- Effect of translation adjustments on cash 1.9 (.9) ------- ------- Net decrease in cash and cash equivalents (88.4) (50.7) Cash and cash equivalents, beginning of period 232.4 248.7 ------- ------- Cash and cash equivalents, end of period $ 144.0 $ 198.0 ------- ------- ------- ------- See accompanying Notes to Condensed Consolidated Financial Statements. Certain reclassifications of prior years' data have been made to conform to 1997 presentation. 6 DRESSER INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 1997 (Unaudited) NOTE A - INFORMATION BY INDUSTRY SEGMENT (IN MILLIONS) Three Months Ended Six Months Ended April 30, April 30, ----------------------- ---------------------- 1997 1996 1997 1996 -------- -------- -------- -------- REVENUES Petroleum Products and Services $ 644.6 $ 521.9 $1,247.3 $ 988.1 -------- -------- -------- -------- Engineering Services M. W. Kellogg Operations 444.5 466.4 901.7 858.4 -------- -------- -------- -------- Energy Equipment Compression and Pumping 296.4 264.9 587.8 540.4 Measurement 164.2 154.1 315.2 301.8 Flow Control 143.0 150.1 288.3 295.9 Power Systems 84.5 79.0 145.2 143.5 -------- -------- -------- -------- 688.1 648.1 1,336.5 1,281.6 Eliminations (5.9) (6.8) (9.7) (35.6) -------- -------- -------- -------- Total revenues $1,771.3 $1,629.6 $3,475.8 $3,092.5 -------- -------- -------- -------- -------- -------- -------- -------- OPERATING PROFIT Petroleum Products and Services $ 75.4 $ 57.1 $ 147.4 $ 110.0 -------- -------- -------- -------- Engineering Services 24.4 21.8 50.8 40.9 -------- -------- -------- -------- Energy Equipment Compression and Pumping 22.0 15.2 31.6 29.3 Measurement 15.7 11.8 26.9 21.2 Flow Control 15.7 16.4 26.0 28.8 Power Systems 12.9 9.2 13.5 12.4 -------- -------- -------- -------- 66.3 52.6 98.0 91.7 -------- -------- -------- -------- Total segment operating profit 166.1 131.5 296.2 242.6 Amortization of acquisition intangibles (7.8) (7.8) (15.4) (16.2) General corporate expenses (19.2) (20.9) (40.1) (40.7) Interest expense, net (15.2) (10.9) (30.0) (20.9) -------- -------- -------- -------- Earnings before taxes and minority interest $ 123.9 $ 91.9 $ 210.7 $ 164.8 -------- -------- -------- -------- -------- -------- -------- --------
7 DRESSER INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS APRIL 30, 1997 (UNAUDITED) NOTE B - UNCONSOLIDATED AFFILIATED COMPANIES The Company has several investments in less than majority owned affiliates. A summary of the impact of these investments on the condensed consolidated financial statements follows (in millions): Three Months Ended Six Months Ended April 30, April 30, ------------------ ---------------- 1997 1996 1997 1996 ---- ---- ---- ---- Share of earnings of unconsoli- dated affiliates Ingersoll-Dresser Pump (49% owned) $5.9 $2.5 $15.1 $11.7 Other affiliates 2.2 .9 4.0 2.1 ---- ---- ----- ----- $8.1 $3.4 $19.1 $13.8 ---- ---- ----- ----- ---- ---- ----- ----- April 30, October 31, 1997 1996 ---- ---- Investments in and receivables from unconsolidated affiliates Ingersoll-Dresser Pump (49% owned) $119.4 $132.5 Other affiliates 59.1 50.0 ------ ------ $178.5 $182.5 ------ ------ ------ ------ NOTE C - INVENTORIES The determination of inventory values and cost of sales under the LIFO method for interim financial results is based on management's estimates of expected year-end inventories. Inventories include the following (in millions): April 30, October 31, 1997 1996 ---- ---- Finished products and work in process $720.1 $699.4 Raw materials and supplies 221.9 214.2 ------ ------ $942.0 $913.6 ------ ------ ------ ------ 8 DRESSER INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS APRIL 30, 1997 (UNAUDITED) NOTE D - DIVIDENDS On May 15, 1997 the Company declared a quarterly dividend of $.17 per share of common stock payable on June 20, 1997 to shareholders of record on June 2, 1997. NOTE E - LITIGATION AND CONTINGENCIES The Company is involved in certain legal actions and claims arising in the ordinary course of business. See Note J -Commitments and Contingencies - in the Company's 1996 Annual Report on Form 10-K for a complete discussion of these matters. A discussion of significant changes subsequent to October 31, 1996 follows. ASBESTOSIS LITIGATION The Company has approximately 75,100 pending claims at April 30, 1997, with approximately 4,700 new claims filed and approximately 2,700 claims resolved during the second quarter of the fiscal year. Approximately 32,100 claims are currently being carried as pending until the settlements or dismissals are final. Resolution of these claims will reduce the number of pending claims at April 30, 1997, by approximately 45% for refractory product claims and 42% for non-refractory product claims. Management recognizes the uncertainties of litigation and the possibility that one or more adverse rulings could materially impact operating results. However, based upon the nature of and management's understanding of the facts and circumstances which gave rise to such actions and claims, management believes that such litigation and claims will be resolved without material effect on the Company's financial position or results of operations. 9 DRESSER INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS APRIL 30, 1997 (UNAUDITED) NOTE F - BAROID FINANCIAL INFORMATION Dresser Industries, Inc. (Dresser) merged with Baroid Corporation (Baroid) on January 21, 1994. Baroid has ceased filing periodic reports with the Securities and Exchange Commission. Baroid's 8% Senior Notes (the Notes)remain outstanding and are fully guaranteed by the Company. As long as the Notes remain outstanding, summarized financial information of Baroid is required to be presented as follows (in millions): April 30, October 31, 1997 1996 ---- ---- BAROID CORPORATION Current assets $ 891.9 $ 796.2 Noncurrent assets 581.1 578.9 -------- -------- Total $1,473.0 $1,375.1 -------- -------- -------- -------- Current liabilities $ 396.2 $ 377.7 Noncurrent liabilities 464.0 429.2 Shareholders' equity 612.8 568.2 -------- -------- Total $1,473.0 $1,375.1 -------- -------- -------- -------- Three Months Ended Six Months Ended April 30, April 30, ------------------ ---------------- 1997 1996 1997 1996 ---- ---- ---- ---- Revenues $474.4 $374.9 $904.3 $732.8 ------ ------ ------ ------ ------ ------ ------ ------ Gross earnings $131.5 $105.0 $254.3 $210.0 ------ ------ ------ ------ ------ ------ ------ ------ Earnings from operations $ 59.9 $ 44.4 $112.6 $ 91.2 Other income (deductions) (2.7) (4.5) (7.7) (11.6) ------ ------ ------ ------ Earnings before taxes and minority interests 57.2 39.9 104.9 79.6 Income taxes (20.0) (13.6) (36.7) (27.1) Minority interest (.4) - (.3) (.2) ------ ------ ------ ------ Net earnings $ 36.8 $ 26.3 $ 67.9 $ 52.3 ------ ------ ------ ------ ------ ------ ------ ------ 10 DRESSER INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS APRIL 30, 1997 (UNAUDITED) NOTE G - OTHER DEVELOPMENTS On March 5, 1997, the Company signed a letter of intent to sell certain assets of its Sub Sea International Division to Global Industries, Ltd. The Company is currently responding to a second information request from the Department of Justice related to its Hart-Scott-Rodino filing. 11 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS - THREE MONTHS AND SIX MONTHS ENDED APRIL 30, 1997 COMPARED TO 1996 CONSOLIDATED OPERATIONS Earnings per share for the second quarter increased 35% to $.42 versus $.31 in the 1996 second quarter. Revenues of $1.8 billion were 9% higher, and segment operating profit of $166.1 million was 26% higher than in the 1996 second quarter. The results for the second quarter were primarily driven by high activity levels across the oil and gas industry. April 30, 1997 consolidated backlog was $5.3 billion, 18% higher than a year ago. For the six months ended April 30, 1997, net earnings and earnings per share increased 26% to $126.9 million and $.72 versus $103.7 million and $.57 in 1996. Six month revenues of $3.48 billion were 12% higher than a year ago, and operating profit of $296.2 million was 22% higher than a year ago. Selling, engineering, administrative and general expenses of $267.1 million for the quarter and $525.1 million for the six months were about 10% higher than the prior year. The increase was primarily due to higher levels of business activity. Net interest expense of $15.2 million in the quarter and $30.0 million for the six months was up 39% and 44%, respectively, from the 1996 periods due primarily to an increase in total borrowings and a higher interest rate on new long-term debt versus the previously issued commercial paper. The estimated income tax rate for the six months ended April 30, 1997 is currently 35% compared to 34% for last year. INDUSTRY SEGMENT ANALYSIS See Note A to Condensed Consolidated Financial Statements for details of financial information by Industry Segment. PETROLEUM PRODUCTS AND SERVICES SEGMENT Revenues rose 24% to $644.6 million for the quarter and 26% to $1,247.3 million for the six months. Operating profit increased 32% to $75.4 million for the quarter and 34% to $147.4 million for the six months. 12 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS INDUSTRY SEGMENT ANALYSIS (CONTINUED) PETROLEUM PRODUCTS AND SERVICES SEGMENT (CONTINUED) Drilling and production activity continued to be strong in the quarter, as indicated by a 14% increase in worldwide rig count. North American rig activity was 24% higher, and offshore activity was 10% higher. Baroid Drilling Fluids, Sperry-Sun and Security DBS saw substantial volume increases in both the quarter and the six month periods. Improved product mix and market share gains also contributed to higher earnings. Bredero-Shaw, Sub Sea and Wellstream had significantly higher revenues in both the quarter and the six months. Bredero-Shaw and Wellstream had improved profits in both periods. Pipeline activity in the North Sea, Mid East, Far East and the U.S. spurred the improved performance of the Bredero-Shaw pipecoating business. Wellstream benefitted from subsea completion activity in the North Sea and offshore Brazil. Sub Sea began work on the Schiehallion field in the West of Shetlands offshore region, but continued to be negatively impacted by market conditions in the Gulf of Mexico. At the end of the quarter, segment backlog was $547.3 million, up from $526.5 million a year ago. ENGINEERING SERVICES SEGMENT M. W. KELLOGG OPERATIONS For the quarter, operating profit increased 12% to $24.4 million despite revenues of $444.5 million being down 5%. For the six months, operating profit was up 24% to $50.8 million, and revenues were up 5% to $901.7. The profit improvement for the quarter and the six months reflected higher activity on LNG and ammonia projects in Africa, the Mid East and Latin America, with earnings also benefitting from successful milestones being reached on several projects nearing completion in Europe, the Far East and South America. Year-to-date bookings were $1.1 billion, and backlog at April 30, 1997 was a record $3.1 billion. The backlog was 35% higher than a year ago. Bid and proposal costs in the six months of $20.9 million were 17% higher than last year. ENERGY EQUIPMENT SEGMENT Segment operating profit for the quarter of $66.3 million was up 26% and revenues of $688.1 million were up 6%. For the six months, segment operating profit of $98.0 million and revenues of $1,336.5 million were up 7% and 4%, respectively. Of the four business lines, only Flow Control had lower revenues and earnings. Segment backlog was $1.7 billion, up from $1.5 billion at October 31, 1996 and the same as a year ago. 13 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS INDUSTRY SEGMENT ANALYSIS (CONTINUED) ENERGY EQUIPMENT SEGMENT (CONTINUED) COMPRESSION AND PUMPING Revenues and operating profits were up for both the quarter and the six months. Compared to 1996, Dresser-Rand's operating profit rose 36% for the quarter but was off 8% year-to-date. The gain in the quarter reflected increased contract compression activity in South America. Year-to-date profit continued to be negatively impacted by sales of low margin complete machines earlier this year. Earnings from Ingersoll-Dresser Pump were up in the quarter and the six months reflecting improvements in the Engineered Products Group along with lower headquarters expenses. MEASUREMENT Revenues rose 7% while operating profits were up 33% in the quarter. In the six months, revenues rose 4% and operating profits were up 27%. Successful product introductions and lower U.S. cost structure in the Wayne fuel dispenser business accounted for the majority of the earnings improvement. FLOW CONTROL Revenues and operating profits were down slightly in both the quarter and the six months reflecting lower margin shipments in the Control Valve business earlier this year. Energy Valve results are ahead of last year, and bidding activity continues at high levels. POWER SYSTEMS In the quarter, operating profit was up 40% on a revenue gain of 7%. For the six months, operating profit was up 9% while revenues were essentially level. The gains in the quarter reflected improvements by Waukesha as it recovered from a work slowdown earlier in the year and benefitted from growth in the gas compression market and high aftermarket activity. 14 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS LIQUIDITY, CAPITAL RESOURCES AND FINANCIAL CONDITION The Company's overall financial condition remained strong at April 30, 1997. Since the beginning of the year, the Company used approximately $113.4 million more cash than the operations generated resulting in an increase in short-term borrowings of $26.5 million. Major expenditures included $114.6 million for capital expenditures and $59.8 million for dividends. In addition, $190.9 million of cash was used to finance working capital, primarily for increases in inventories and decreases in payables and accrued expenses. Total debt was $867.4 million as of April 30, 1997, compared to $842.3 million at October 31, 1996. Total debt was 35% of total book capitalization as of April 30, 1997 and October 31, 1996. Net debt was 12% of market capitalization at April 30, 1997, versus 9% at October 31, 1996. LEGAL AND ENVIRONMENTAL MATTERS The Company is currently involved in a number of lawsuits and has also been identified as a potentially responsible party in a number of Superfund sites. Note E to Condensed Consolidated Financial Statements includes significant changes subsequent to October 31, 1996. In accordance with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, the Company notes that the statements in this Form 10-Q and elsewhere, which are forward-looking and which provide other than historical information, involve risks and uncertainties that may impact the Company's results of operations. These forward-looking statements include, among others, statements concerning the Company's general business strategies, financing decisions, corporate structure, backlog, operating trends, industry trends, cost reduction strategies and their results, expectations for funding capital expenditures and operations in future periods. The Company also continues to face many risks and uncertainties including: litigation, environmental laws, operations in high risk countries, technological and structural changes in the industries served by the Company, changes in the price of oil and natural gas, changes in capital spending by customers in the hydrocarbon industry for exploration, development, production, processing and refining and pipeline delivery networks. The risks and uncertainties inherent in these forward-looking statements could cause actual results to differ materially from those expressed in or implied by these statements. 15 PART II. OTHER INFORMATION ITEM 2. CHANGES IN SECURITIES (c) In March 1997, the Company issued 23 shares of Common Stock ($.25 par value) to one executive officer of the Company in connection with the exercise of stock options. Under the terms of the Company's 1989 Restricted Incentive Stock Plan (Plan), one restricted share will be issued for every five shares of the related stock option exercised. Stock issued pursuant to the Plan are not registered. No consideration for the unregistered shares was exchanged. In issuing the above securities, the Company relied on the exemption from the registration and prospectus delivery requirements of the Securities Act of 1933 (the Securities Act) provided by Section 4(2) of the Securities Act. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS (a) The Annual Meeting of Shareholders of Registrant was held on March 20, 1997 (c) At the Annual meeting, the shareholders: (i) voted to elect, in an uncontested election, twelve directors of the Company. Each nominee for Director was elected by a vote of the shareholders as follows: Votes Votes For Withheld William E. Bradford 146,966,808 329,259 Samuel B. Casey, Jr. 146,906,330 389,737 Lawrence S. Eagleburger 146,901,426 394,641 Sylvia A. Earle 146,923,326 372,741 Rawles Fulgham 146,950,182 345,885 John Gavin 146,950,001 346,066 Ray L. Hunt 146,969,659 326,408 J. Landis Martin 146,963,286 332,781 Lionel H. Olmer 146,935,699 360,368 Jay A. Precourt 136,640,364 10,655,703 Donald C. Vaughn 146,955,052 341,015 Richard W. Vieser 146,916,777 379,290 ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits. Exhibit 27 Financial Data Schedule 16 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. DRESSER INDUSTRIES, INC. By: /s/ Kenneth J. Kotara Kenneth J. Kotara Controller Dated: June 16, 1997 17 EXHIBIT INDEX Exhibit Description - ------- ----------- 27 Financial Data Schedule. (Pursuant to Item 601(c)(iv) of Regulation S-K, the Financial Data Schedule is not deemed to be "filed" for purposes of Section 11 of the Securities Act of 1933, as amended, or Section 18 of the Securities Exchange Act of 1934, as amended.) EX-27 2 EX 27
5 1,000 6-MOS OCT-31-1997 APR-30-1997 144,000 0 1,146,500 0 942,000 2,397,400 2,878,300 1,643,400 5,054,600 1,747,800 754,800 0 0 46,200 1,567,300 5,054,600 3,456,700 3,475,800 2,707,300 3,232,400 0 0 34,300 210,700 73,800 126,900 0 0 0 126,900 .72 .72
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