-----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, N5hFw20FsINm4w1sKXzJ2zXZzA4Lx7FxLhBmvLOvFpmdpWO/Gxe60sHPnGa0lOt2 wvQgfTKzSTm5j9NoSp1swA== 0000005850-98-000004.txt : 19980209 0000005850-98-000004.hdr.sgml : 19980209 ACCESSION NUMBER: 0000005850-98-000004 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980203 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980206 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN STANDARD INC CENTRAL INDEX KEY: 0000005850 STANDARD INDUSTRIAL CLASSIFICATION: AIR COND & WARM AIR HEATING EQUIP & COMM & INDL REFRIG EQUIP [3585] IRS NUMBER: 250900465 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-00470 FILM NUMBER: 98524360 BUSINESS ADDRESS: STREET 1: ONE CENTENNIAL AVE STREET 2: P O BOX 6820 CITY: PISCATAWAY STATE: NJ ZIP: 08855-6820 BUSINESS PHONE: 9089806000 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN RADIATOR & STANDARD SANITARY CO DATE OF NAME CHANGE: 19670620 8-K 1 8K AND PRESS RELEASE UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): February 3, 1998 ------------------- AMERICAN STANDARD INC. (Exact name of registrant as specified in its charter) Delaware 33-64450 25-0900465 (State or other jurisdiction of (Commission File No.) (I.R.S. Employer incorporation or organization) Identification No.) One Centennial Avenue, P.O. Box 6820, Piscataway, NJ 08855-6820 (Address of principal executive offices) (Zip Code) Registrant's Telephone Number, including area code: (732)980-6000 ITEM 5. Other Events By press release dated February 3,1998, American Standard Companies Inc., a Delaware corporation that has as its only significant asset all of the outstanding shares of the Company's common stock, announced its earnings for the quarter and full year ended December 31, 1997, a copy of which press release is filed as an exhibit to this report. Information Concerning Forward-Looking Statements. Certain of the statements contained in this report (other than the historical financial data and other statements of historical fact), including, without limitation, statements as to management's expectations and belief are forward-looking statements. Forward-looking statements are made based upon management's expectations and belief concerning future developments and their potential effect upon the Company. There can be no assurance that future developments will be in accordance with management's expectations or that the effect of future developments on the Company will be those anticipated by management. Many important factors could cause actual results to differ materially from management's expectations, including the level of new construction activity in the Company's Air Conditioning Products' and Plumbing Products' markets; the timing of completion and success in the start-up of new production facilities; changes in U. S. or international economic conditions, such as inflation or interest rate fluctuations or recessions in the Company's markets; pricing changes to the Company's products or those of its competitors, and other competitive pressures on pricing and sales; integration of acquired businesses; risks generally relating to the Company's international operations, including governmental, regulatory or political changes; and transactions or other events affecting the need for, timing and extent of the Company's capital expenditures. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. (c ) Exhibits. 99.1 Press release dated February 3, 1998 of American Standard Companies Inc. 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. By ____/s/ G. Ronald Simon_____________ Name: G. Ronald Simon Title: Vice President and Controller DATE: February 6, 1998 EX-99.1 2 AMERICAN STANDARD NEWS RELEASE NEWS RELEASE FOR IMMEDIATE RELEASE AMERICAN STANDARD COMPANIES INC. REPORTS 17% INCREASE IN 1997 EARNINGS PER SHARE Piscataway, NJ - February 3, 1998 - American Standard Companies Inc. (NYSE:ASD) today announced that full year 1997 diluted per share earnings before extraordinary item (and before a write-off of purchased research and development) were a record $2.76, an increase of 17% over 1996 diluted per share earnings of $2.36 (excluding a non-cash asset impairment charge). Fourth quarter 1997 diluted per share earnings were $.62, an increase of 11% over fourth quarter 1996 diluted per share earnings of $.56. These results are consistent with the Company's previously announced expectations. Mr. Emmanuel A. Kampouris, Chairman, President and Chief Executive Officer, remarked, "The Company posted solid growth in sales and earnings in 1997 despite the adverse effect of cooler than normal weather on the air conditioning business in both the U.S. and Europe and the effects of foreign exchange, initially in Europe and more recently as a result of dramatic events in the Far East. Our ability to partially overcome these adversities clearly validates our strategies built on our global diversity and leadership positions worldwide, which provide the foundation for strong sales and earnings growth. While we expect weakness in the Far East outside China to continue and have adopted plans to monitor and limit the impact, we also believe our improvements elsewhere will continue." Total Sales for 1997 reached a record $6.0 billion, an increase of 4% from $5.8 billion in 1996 (an 8% increase excluding the $218 million unfavorable foreign exchange effect). Excluding foreign exchange effects: o Air Conditioning Products sales, although weakened by cooler than average temperatures in important markets, increased 5% to $3.6 billion. Strength in the U.S. commercial businesses, both applied systems and unitary products, more than offset a decline in the residential business. International sales also grew due to strong sales growth in Latin America and modest growth in Europe and the Middle East. o Plumbing Products sales increased 5% to $1.4 billion reflecting strong markets in Latin America, increased sales through expanding major U.S home improvement retailers and the effect of consolidating the operations in China since the acquisition of a majority interest at the end of October. Sales matched the prior year level in Europe and, despite recent economic weakness, Far East sales for the full year (excluding China) were flat. o Automotive Products sales increased 14% to $952 million driven by continued strengthening in European commercial vehicle production, higher product content per vehicle and increased export sales. Sales of anti-lock braking systems (ABS) to the Company's U.S. marketing joint venture rose sharply, reflecting the first-phase implementation of federal regulations requiring ABS systems on all new heavy trucks, together with a rebound in heavy-duty truck production. o Medical Systems sales were $50 million, reflecting the acquisition of the diagnostic businesses at the end of June. Operating Income in 1997 (excluding the write-off of purchased in-process research and development) was $590 million, an increase of 3% from $573 million in 1996, excluding an asset impairment charge. Operating income increased 7% excluding the $22 million unfavorable effect of foreign exchange. Excluding foreign exchange effects: o Air Conditioning Products operating income rose 3% to $364 million despite cooler than normal weather in both the U.S. and Europe. Increased volume and improved margin in both the applied and unitary commercial businesses more than offset weather related declines in both the U.S. residential and European businesses and the effect of economic weakness in the Far East. o Plumbing Products operating income increased 18% to $119 million on increased volume and improved margin in both Latin America and U.S. operations. Margin expansion in Europe, primarily from cost reductions in France, also contributed to the increase. The Company's China operations, consolidated for only the final two months of the year, offset the effects of lower volume and margin elsewhere in the Far East. o Automotive Products operating income increased 14% to $127 million. Increased volume and improved margin in European operations was partially offset by lower margin in Brazil and start-up costs of new, majority-owned ventures in the U.S. and China. o Medical Systems operating loss reflected continued costs of development and of integrating operations of the diagnostic businesses acquired in June. Write-off of Purchased Research and Development of $90 million results from the accounting for the June 30, 1997 acquisition of the medical diagnostic businesses. Interest Expense declined by $6 million from the prior year as lower interest rates achieved through the Company's 1997 Credit Agreement and redemption of $250 million 11 3/8% Senior Debentures in May 1997, financed under the Credit Agreement, offset the effect of increased debt arising from share repurchases and acquisition of the medical diagnostic businesses. Equity in Net Income of Unconsolidated Joint Ventures increased to $12 million compared to 1996 income of $3 million reflecting strong growth of Automotive Products' U.S. joint venture, benefits from the restructuring of Air Conditioning Products' scroll compressor joint venture and increased income from the Company's financing joint venture established in 1996. Plumbing Products' rapidly expanding businesses in China also contributed to the increase prior to the consolidation of such operations at the end of October when the Company acquired controlling interest in those businesses. Corporate and Other Expense was essentially flat. Income Taxes were $117 million, or 35.8% of pretax income excluding the write-off of purchased R&D, compared to 35.6% for 1996 excluding an asset impairment charge. Effective December 31, 1997, the Company adopted Statement of Financial Accounting Standards No. 128, "Earnings per Share" ("FAS 128"), which simplifies the standards for computing earnings per share, changes the manner of presentation on the income statement and requires the restatement of all prior periods presented. Accordingly, the Company has reported 1997 diluted income per common share of $2.76 (excluding a write-off of purchased in-process research and development related to the acquisition of the medical diagnostics businesses), compared with restated 1996 diluted income per common share of $2.36 (excluding an asset impairment loss). Overall, foreign exchange effects unfavorably impacted sales by 4%, or $218 million, and operating income by 4%, or $22 million. Offsetting favorable foreign exchange effects in interest, accretion and taxes brought the net unfavorable impact of foreign exchange to an after-tax effect of $.12 per share. Sales in the Far East (excluding China), approximately 6% of total consolidated sales, were down $27 million from 1996 and pre-tax income was $17 million, down $13 million from 1996. Fourth quarter 1997 sales were $1.5 billion, an increase of 7% from $1.4 billion in 1996 (a 12% increase excluding an unfavorable foreign exchange effect). Sales were strong for most U.S. businesses (particularly commercial air conditioning) and for Automotive Products, with sales of the new Medical Systems segment contributing to the gain. Far East sales, excluding China, declined. Operating income for the fourth quarter of 1997 was $138 million, an increase of 6% from $130 million in the 1996 quarter (a 12% increase excluding unfavorable foreign exchange effects). Air Conditioning gained 14% and Plumbing 6% (despite weakness in the Far East) which, together with a small gain for Automotive, were partly offset by a loss for Medical Systems. American Standard is the global, diversified manufacturer of Trane (R) and American Standard(R) air conditioning products, American Standard(R), Ideal Standard(R), Standard(R) and Porcher(R) plumbing products, WABCO(R) commercial and utility vehicle braking and control systems, LARA(TM) and Copalis(TM) medical diagnostic systems and DiaSorin(TM) and INCSTAR(R) medical diagnostic products. For Further Information, Contact: Ray Pipes (732) 980-6139 or, Phil Bradtmiller (732) 980-6038 The latest news release and corporate information can be heard on 1-888-ASD-NEWS. Additional information on American Standard is available on the Company's World Wide Web site http://www.americanstandard.com
AMERICAN STANDARD COMPANIES INC. SUMMARY SEGMENT DATA (Unaudited) In millions Three Months Ended December 31, ------------------------------- 1997 1996 ------- ------- Operating Operating Reported Margin Reported Margin -------- ------ -------- ------ Sales Air Conditioning Products $ 883 $ 835 Plumbing Products 377 373 Automotive Products 253 229 Medical Systems 26 -- ----- ----- $1,539 $1,437 ====== ====== Operating income (loss) Air Conditioning Products $ 79 8.9% $ 69 8.3% Plumbing Products 33 8.8% 31 8.3% Automotive Products 33 13.0% 32 14.0% Medical Systems (7) -- (2) -- ------- ------ $ 138 9.0% $ 130 9.0% ======= ======
Year Ended December 31, ----------------------- 1997 1996 ---- ----- Operating Operating Adjusted Margin Adjusted Margin -------- ------ -------- ------ Sales Air Conditioning Products $3,567 $3,437 Plumbing Products 1,439 1,452 Automotive Products 952 916 Medical Systems 50 -- ------ ------ $6,008 $5,805 ====== ====== Operating income (loss) before write-off of purchased research and development and asset impairment loss Air Conditioning Products $ 364 10.2% $ 353 10.3% Plumbing Products 119 8.3% 110 7.6% Automotive Products 127 13.3% 123 13.4% Medical Systems (20) -- (13) -- ------- ------ $ 590 9.8% $ 573 9.9% ======= ======
AMERICAN STANDARD COMPANIES INC. CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) In millions except per share data Three Months Ended December 31, ------------------------------- 1997 1996 ----- ----- Sales $1,539 $ 1,437 Operating income $ 138 $ 130 Equity in net income of unconsolidated joint ventures 3 6 ---- ---- 141 136 Interest expense 48 47 Corporate and other expenses 21 19 ---- ---- Income before income taxes 72 70 Income taxes 26 25 ---- ---- Net income $ 46 $ 45 ======= ===== Net income per common share: Basic $ .64 $ .57 ==== ======= Diluted $ .62 $ .56 ==== ======= Average outstanding common shares-basic 71.9 78.5 Average outstanding common shares-diluted 74.0 80.7
AMERICAN STANDARD COMPANIES INC. CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) In millions except Year Ended December 31, ----------------------- per share data 1997 1996 ---- ----- Reported Adjusted(a) Reported Adjusted(b) -------- -------- -------- -------- Sales $6,008 $6,008 $5,805 $5,805 Operating income before write-off of purchased research and development and asset impairment loss $ 590 $ 590 $ 573 $ 573 Write-off of purchased research and development (a) 90 -- -- -- Asset impairment loss (b) -- -- 235 -- ------ ------ ------ ------ Operating income 500 590 338 573 Equity in net income of unconsolidated joint ventures 12 12 3 3 ------ ------ ------ ------ 512 602 341 576 Interest expense 192 192 198 198 Corporate and other expenses 83 83 85 85 ------ ------ ------ ------ Income before income taxes and extraordinary item 237 327 58 293 Income taxes 117 117 104 104 ---- ---- ---- --- Income (loss) before extraordinary item 120 210 (46) 189 Extraordinary loss on retirement of debt, net of tax (24) (24) -- -- ------ ------ ------ ------ Net income (loss) $ 96 $ 186 $ (46) $ 189 ===== ====== ====== ===== Per common share (c): Basic: Income (loss) before extraordinary item $ 1.62 $ 2.85 $ (.60) $ 2.42 Extraordinary loss on retirement of debt (.32) (.32) -- -- ----- ----- --- -- Net income (loss) $ 1.30 $ 2.53 $ (.60) $ 2.42 ===== ====== ======== ===== Diluted: Income (loss) before extraordinary item $ 1.57 $ 2.76 $ (.60) $ 2.36 Extraordinary loss on retirement of debt (.31) (.31) -- -- ----- ----- --- -- Net income (loss) $ 1.26 $ 2.45 $ (.60) $ 2.36 ====== ======= ======== ====== Average outstanding common shares-basic 73.8 73.8 78.0 78.0 Average outstanding common shares-diluted 76.2 76.2 78.0 79.8 (a) In connection with the June 30, 1997 acquisition of the medical diagnostics businesses, the value of purchased in-process research and development was written off in accordance with applicable accounting rules. (b) Effective January 1, 1996, the Company adopted FAS 121 which resulted in an asset impairment loss of $235 million resulting predominantly from the write-down of goodwill for which no tax benefit was available. (c) Earnings per common share for all periods presented have been presented in accordance with FAS 128, "Earnings per Share", adopted effective December 31, 1997.
-----END PRIVACY-ENHANCED MESSAGE-----