-----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, J667JeMb1wpEk3xc17fq6VlpUVKdHbU7h7vY1c6IhK2MN41na2tp3tc5MIsIskY7 K6vS68Cmo4t6EAjNWvLgMw== 0000950123-04-009176.txt : 20040803 0000950123-04-009176.hdr.sgml : 20040803 20040803160740 ACCESSION NUMBER: 0000950123-04-009176 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040803 ITEM INFORMATION: FILED AS OF DATE: 20040803 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALLEGHANY CORP /DE CENTRAL INDEX KEY: 0000775368 STANDARD INDUSTRIAL CLASSIFICATION: TITLE INSURANCE [6361] IRS NUMBER: 510283071 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09371 FILM NUMBER: 04948627 BUSINESS ADDRESS: STREET 1: 375 PARK AVENUE STREET 2: SUITE 3201 CITY: NEW YORK STATE: NY ZIP: 10152 BUSINESS PHONE: 2127521356 MAIL ADDRESS: STREET 1: 375 PARK AVENUE STREET 2: SUITE 3201 CITY: NEW YORK STATE: NY ZIP: 10152 FORMER COMPANY: FORMER CONFORMED NAME: ALLEGHANY FINANCIAL CORP DATE OF NAME CHANGE: 19870115 8-K 1 y99701ke8vk.txt FORM 8-K 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): August 3, 2004 ------------------- ALLEGHANY CORPORATION (Exact name of registrant as specified in its charter)
Delaware 1-9371 51-0283071 -------- ------ ---------- (State or other jurisdiction of (Commission File Number) (IRS Employer Identification No.) Incorporation)
375 Park Avenue, Suite 3201 New York, New York 10152 ---------------------------------------- ---------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (212) 752-1356 ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. (c) Exhibits Exhibit Number Description - -------------- ----------- 99.1 2004 Second Quarter Earnings Release, dated August 3, 2004. ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION. On August 3, 2004, Alleghany Corporation issued a press release on the subject of its 2004 second quarter consolidated earnings, A copy of such release is furnished herewith as Exhibit 99.1. The information hereunder shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liabilities of that section, nor shall it be incorporated by reference into a filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. 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. ALLEGHANY CORPORATION /s/ Peter R. Sismondo -------------------------- By: Peter R. Sismondo Vice President, Controller, Treasurer and Assistant Secretary Date: August 3, 2004 INDEX TO EXHIBITS
Exhibit Number Exhibit Description - -------------- ------------------- 99.1 2004 Second Quarter Earnings Release, dated August 3, 2004
EX-99.1 2 y99701kexv99w1.txt 2004 2ND QUARTER EARNINGS RELEASE EXHIBIT 99.1 NEW YORK, NY, August 3, 2004 -- Net earnings of Alleghany Corporation (NYSE-Y) in the second quarter of 2004 were $48.7 million, or approximately $6.33 diluted earnings per share of common stock, compared with net earnings of $6.0 million, or approximately $0.79 diluted earnings per share of common stock, in the second quarter of 2003, John J. Burns, Jr., President and chief executive officer of Alleghany, announced today. Net gains on investment transactions after taxes in the second quarter of 2004 totalled $2.8 million, or $0.37 per share, compared with $1.0 million, or $0.14 per share, in the corresponding 2003 period. In the first six months of 2004, Alleghany's net earnings were $110.8 million, or approximately $14.40 diluted earnings per share, compared with net earnings of $13.7 million, or $1.80 diluted earnings per share, in the first six months of 2003. The 2004 six-month results include net gains on investment transactions after taxes of $24.4 million, or approximately $3.18 per share, compared with $3.1 million, or approximately $0.42 per share, in the corresponding 2003 period. Alleghany common stockholders' equity per share at June 30, 2004 was $218.32 per share, an increase from common stockholders' equity per share of $210.33 as of March 31, 2004 (both as adjusted for the stock dividend declared in March 2004). Highlights are as follows (in millions, except for per share and share amounts):
Three Months Ended Six Months Ended June 30, June 30, -------- -------- 2004 2003 2004 2003 ---- ---- ---- ---- Revenues $ 334.1 $ 144.4 $ 678.1 $ 283.0 Earnings before income taxes $ 74.5 $ 8.7 $ 170.2 $ 20.3 Net earnings $ 48.7 $ 6.0 $ 110.8 $ 13.7 Basic earnings per share of common stock * $ 6.35 $ 0.79 $ 14.46 $ 1.81 Diluted earnings per share of common stock* $ 6.33 $ 0.79 $ 14.40 $ 1.80 Average number of outstanding shares of common stock* 7,670,297 7,582,105 7,661,002 7,571,762
* Adjusted to reflect the dividend of common stock declared in March 2004. The comparative contributions to earnings before taxes made by Alleghany's operating units Alleghany Insurance Holdings LLC ("AIHL," a holding company for Alleghany's property and casualty insurance businesses, consisting of RSUI Group, Inc. ("RSUI"), Capitol Transamerica Corporation ("CATA") and Darwin Professional Underwriters, Inc. ("Darwin")), and World Minerals (industrial minerals business), as well as by Alleghany's parent company and other operations, were as follows (in millions):
Three Months Ended Six Months Ended June 30, June 30, -------- -------- 2004 2003 2004 2003 ---- ---- ---- ---- AIHL $75.2 $2.7 $165.9 $ 7.6 World Minerals 5.6 6.5 10.8 11.4 Corporate activities (6.4) (0.5) (6.5) 1.3 ----- ---- ------ ----- Total $74.4 $8.7 $170.2 $20.3 ===== ==== ====== =====
On a diluted per-share, after-tax basis, the foregoing earnings contributions may be broken down as follows: THREE MONTHS ENDED JUNE 30,
World Corporate AIHL Minerals activities Total ---- -------- ---------- ----- 2004 Operating income (loss)* $ 6.09 $ 0.40 $ (0.53) $ 5.96 Net gain on investment transactions 0.37 - - 0.37 -------- -------- -------- -------- Net earnings (loss) per share $ 6.46 $ 0.40 $ (0.53) $ 6.33 ======== ======== ======== ======== 2003 Operating income (loss)* $ 0.35 $ 0.45 $ (0.15) $ 0.65 Net gain on investment transactions - - 0.14 0.14 -------- -------- -------- -------- Net earnings (loss) per share $ 0.35 $ 0.45 $ (0.01) $ 0.79 ======== ======== ======== ========
SIX MONTHS ENDED JUNE 30, World Corporate AIHL Minerals activities Total ---- -------- ---------- ----- 2004 Operating income (loss)* $ 11.14 $ 0.76 $ (0.68) $ 11.22 Net gain on investment transactions 3.03 -- 0.15 3.18 -------- -------- -------- -------- Net earnings (loss) per share $ 14.17 $ 0.76 $ (0.53) $ 14.40 ======== ======== ======== ======== 2003 Operating income (loss)* $ 0.79 $ 0.75 $ (0.16) $ 1.38 Net gain on investment transactions 0.08 -- 0.34 0.42 -------- -------- -------- -------- Net earnings per share $ 0.87 $ 0.75 $ 0.18 $ 1.80 ======== ======== ======== ========
*Operating income (loss) represents net earnings (loss) per share on a GAAP (generally accepted accounting principles) basis less the net gain or loss on investment transactions taxed at the federal income tax rate. AIHL recorded pre-tax earnings of $75.2 million on revenues of $217.0 million in the 2004 second quarter, compared with pre-tax earnings of $2.7 million on revenues of $38.3 million in the second quarter of 2003, and pre-tax earnings of $165.9 million on revenues of $448.3 million in the first six months of 2004, compared with pre-tax earnings of $7.6 million on revenues of $77.0 million in the first six months of 2003. AIHL's 2004 second quarter net earnings include after-tax investment income of $6.5 million and a realized after-tax net gain on investment transactions of $2.8 million, compared with after-tax investment income of $3.3 million and no realized after-tax net gain on investment transactions in the corresponding 2003 period. AIHL's 2004 second quarter after-tax investment income reflects a larger invested asset base, principally due to capital contributions by Alleghany and the acquisition of RSUI in July 2003. The comparative pre-tax contributions to AIHL's results made by its operating units RSUI, CATA and Darwin were as follows (in thousands, except ratios):
Three Months Ended June 30, -------------------------------------------------- RSUI(1) CATA(2) Darwin(3) Total ------- ------- --------- ----- 2004 Gross premiums written $ 308.1 $ 46.7 $ 20.2 $ 375.0 Net premiums written 171.8 42.2 14.6 228.6 Net premiums earned $ 154.0 $ 39.5 $ 9.7 $ 203.2 Loss and loss adjustment expenses 63.4 22.6 6.1 92.1 Underwriting expenses 23.5 15.6 3.7 42.8 ------- ------- ------- ------- Underwriting profit (loss) (4) $ 67.1 $ 1.3 $ (0.1) $ 68.3 ======= ======= ======= ======= Loss ratio (5) 41.2% 57.2% 62.9% 45.3% Expense ratio (6) 15.3% 39.5% 38.1% 21.1% Combined ratio (7) 56.5% 96.7% 101.0% 66.4% 2003 Gross premiums written - $ 44.1 $ 2.1 $ 46.2 Net premiums written - 39.4 2.0 41.4 Net premiums earned - $ 33.4 $ 0.1 $ 33.5 Loss and loss adjustment expenses - 19.8 0.1 19.9 Underwriting expenses - 13.6 1.4 15.0 ------- ------- ------- Underwriting profit (loss) (4) - $ 0.0 $ (1.4) $ (1.4) ======= ======= ======= Loss ratio (5) - 59.3% - 59.3% Expense ratio (6) - 40.7% - 44.9% Combined ratio (7) - 100.0% - 104.2%
Six Months Ended June 30, -------------------------------------------------- RSUI(1) CATA(2) Darwin(3) Total ------- ------- --------- ----- 2004 Gross premiums written $ 602.5 $ 88.4 $ 40.8 $ 731.7 Net premiums written 309.5 79.0 28.6 417.1 Net premiums earned $ 302.3 $ 74.0 $ 16.6 $ 392.9 Loss and loss adjustment expenses 133.4 41.4 10.4 185.2 Underwriting expenses 47.0 30.8 6.6 84.4 ------- ------- ------- ------- Underwriting profit (loss) (4) $ 121.9 $ 1.8 $ (0.4) $ 123.3 ======= ======= ======= ======= Loss ratio (5) 44.1% 56.0% 62.7% 47.1% Expense ratio (6) 15.5% 41.6% 39.8% 21.5% Combined ratio (7) 59.6% 97.6% 102.5% 68.6% 2003 Gross premiums written - $ 80.5 $ 2.1 $ 82.6 Net premiums written - 71.7 2.0 73.7 Net premiums earned - $ 66.8 $ 0.1 $ 66.9 Loss and loss adjustment expenses - 39.6 0.1 39.7 Underwriting expenses - 26.8 1.4 28.2 ------- ------- ------- Underwriting profit (loss) (4) - $ 0.4 $ (1.4) $ (1.0) ======= ======= ======= Loss ratio (5) - 59.3% - 59.3% Expense ratio (6) - 40.2% - 42.2% Combined ratio (7) - 99.5% - 101.5%
(1) Since July 1, 2003. (2) Includes the results of Platte River Insurance Company, which was acquired contemporaneously with CATA in January 2002 and operates in conjunction with CATA. (3) Although Darwin is an underwriting manager for Platte River and certain subsidiaries of CATA, the results of business generated by Darwin have been separated from CATA's results for purposes of this table. Since Darwin commenced operations in May 2003, it generated minimal business during the second quarter and first six months of 2003. Therefore, ratios for such periods are not separately presented. (4) Represents net premiums earned less loss and loss adjustment expenses and underwriting expenses, all as determined in accordance with generally accepted accounting principles in the United States of America ("GAAP"), and does not include income derived from investments. Underwriting profit (loss) does not replace net income (loss) determined in accordance with GAAP as a measure of profitability; rather, it provides a basis for management to evaluate the underwriting performance of its insurance operating units. (5) Loss and loss adjustment expenses divided by net premiums earned, all as determined in accordance with GAAP. (6) Underwriting expenses divided by net premiums earned, all as determined in accordance with GAAP. (7) The sum of the Loss Ratio and Expense Ratio, all as determined in accordance with GAAP, representing the percentage of each premium dollar an insurance company has to spend on losses (including loss adjustment expenses) and underwriting expenses. RSUI's favorable underwriting results in the first six months of 2004, particularly with respect to its commercial property line, reflect the absence of any significant catastrophe losses and lower than expected commercial property non-catastrophe losses during the 2004 second quarter. RSUI's commercial property business is exposed to catastrophe losses which have historically occurred more frequently during the second and third quarters. The increase in CATA's gross premiums written in the second quarter and first six months of 2004 compared with the corresponding 2003 periods primarily reflects premiums generated from an expansion of its business into the excess and surplus markets. CATA's 2004 second quarter underwriting results reflect better underwriting margins on the current accident year, offset by a resulting increase in profit commissions and a $2.9 million pre-tax charge related to loss reserve development on contract surety and commercial multi-peril liability business written by CATA in the 2003 and prior accident years. Darwin's results in the second quarter and first six months of 2004 continue to reflect start-up expenses incurred to support expected future premium levels, as well as increased competition across all of its lines of business. World Minerals recorded pre-tax earnings of $5.6 million on revenues of $71.3 million in the second quarter of 2004, compared with pre-tax earnings of $6.5 million on revenues of $69.0 million in the corresponding period in 2003, and pre-tax earnings of $10.8 million on revenues of $138.3 million in the first six months of 2004, compared with pre-tax earnings of $11.4 million on revenues of $131.1 million in the first six months of 2003. The 2004 first half results reflect lower margins due to competitive pricing pressures and increased energy, labor and benefit costs, partially offset by the continuing favorable impact of the strong euro versus the U.S. dollar and an increase in net shipments. Corporate activities recorded a pre-tax loss of $6.4 million on revenues of $45.8 million in the second quarter of 2004, compared with a pre-tax loss of $0.5 million on revenues of $37.1 million in the corresponding period in 2003, and a pre-tax loss of $6.5 million on revenues of $91.5 million in the first six months of 2004, compared with pre-tax earnings of $1.3 million on revenues of $74.9 million in the corresponding 2003 period. Corporate activities includes parent company results and the results of miscellaneous subsidiaries, including Heads & Threads International LLC and Alleghany Properties, Inc. The 2004 results for corporate activities reflect increased expense for stock-based incentive compensation due to a significant increase in the market price of Alleghany common stock from June 30, 2003 to June 30, 2004. As of June 30, 2004 Alleghany beneficially owned approximately 8.0 million shares, or 2.1 percent, of the outstanding common stock of Burlington Northern Santa Fe Corporation, which had an aggregate market value on that date of approximately $280.6 million, or $35.07 per share, compared with a market value on June 30, 2003 of $227.5 million, or $28.44 per share. The aggregate cost of such shares is approximately $96.6 million, or $12.07 per share. Alleghany has previously announced that it may purchase shares of its common stock in open market transactions from time to time. In the second quarter of 2004, Alleghany did not purchase any shares of its common stock. As of June 30, 2004, Alleghany had 7,675,313 shares of common stock outstanding (which includes the stock dividend declared in March 2004). Additional information regarding the 2004 second quarter results of Alleghany and its operating units is contained in Alleghany's Report on Form 10-Q for the quarter ended June 30, 2004, which was filed with the U.S. Securities and Exchange Commission on August 3, 2004. # # # ALLEGHANY CORPORATION COMBINING STATEMENTS OF EARNINGS (dollars in thousands) (unaudited)
THREE MONTHS ENDED JUNE 30, 2004 ---------------------------------------------------- ALLEGHANY INSURANCE WORLD CORPORATE HOLDINGS MINERALS ACTIVITIES COMBINED -------- -------- ---------- -------- REVENUES Net fastener sales $ 0 $ 0 $ 43,577 $ 43,577 Interest, dividend and other income 9,387 19 2,261 11,667 Net premiums earned 203,215 0 0 203,215 Net mineral and filtration sales 0 71,246 0 71,246 Net gain (loss) on investment transactions 4,363 0 (11) 4,352 -------- -------- -------- -------- Total revenues 216,965 71,265 45,827 334,057 COSTS AND EXPENSES Underwriting expenses 42,750 0 0 42,750 Salaries, administrative and other operating expenses 6,842 10,063 9,025 25,930 Loss and loss adjustment expenses 92,016 0 0 92,016 Cost of goods sold - fasteners 0 0 32,435 32,435 Cost of mineral and filtration sales 0 55,065 0 55,065 Interest expense 0 573 742 1,315 Corporate administration 106 0 9,986 10,092 -------- -------- -------- -------- Total costs and expenses 141,714 65,701 52,188 259,603 -------- -------- -------- -------- EARNINGS BEFORE INCOME TAXES $ 75,251 $ 5,564 ($ 6,361) 74,454 ======== ======== ======== INCOME TAXES 25,731 -------- NET EARNINGS $ 48,723 ========
THREE MONTHS ENDED JUNE 30, 2003 ---------------------------------------------------- ALLEGHANY INSURANCE WORLD CORPORATE HOLDINGS MINERALS ACTIVITIES COMBINED -------- -------- ---------- -------- REVENUES Net fastener sales $ 0 $ 0 $ 27,292 $ 27,292 Interest, dividend and other income 4,833 119 8,159 13,111 Net premiums earned 33,525 0 0 33,525 Net mineral and filtration sales 0 68,860 0 68,860 Net gain (loss) on investment transactions (39) 0 1,617 1,578 -------- -------- -------- -------- Total revenues 38,319 68,979 37,068 144,366 COSTS AND EXPENSES Underwriting expenses 14,921 0 0 14,921 Salaries, administrative and other operating expenses 874 9,801 9,303 19,978 Loss and loss adjustment expenses 19,815 0 0 19,815 Cost of goods sold - fasteners 0 0 20,809 20,809 Cost of mineral and filtration sales 0 52,201 0 52,201 Interest expense 0 516 952 1,468 Corporate administration 0 0 6,483 6,483 -------- -------- -------- -------- Total costs and expenses 35,610 62,518 37,547 135,675 -------- -------- -------- -------- EARNINGS BEFORE INCOME TAXES $ 2,709 $ 6,461 ($ 479) 8,691 ======== ======== ======== INCOME TAXES 2,695 NET EARNINGS $ 5,996 ========
ALLEGHANY CORPORATION COMBINING STATEMENTS OF EARNINGS (dollars in thousands) (unaudited)
SIX MONTHS ENDED JUNE 30, 2004 -------------------------------------------------------- ALLEGHANY INSURANCE WORLD CORPORATE HOLDINGS MINERALS ACTIVITIES COMBINED -------- -------- ---------- -------- REVENUES Net fastener sales $ 0 $ 0 $ 81,380 $ 81,380 Interest, dividend and other income 19,660 (73) 8,432 28,019 Net premiums earned 392,883 0 0 392,883 Net mineral and filtration sales 0 138,327 0 138,327 Net gain (loss) on investment transactions 35,800 0 1,735 37,535 --------- --------- --------- --------- Total revenues 448,343 138,254 91,547 678,144 COSTS AND EXPENSES Underwriting expenses 84,388 0 0 84,388 Salaries, administrative and other operating expenses 12,826 19,864 17,483 50,173 Loss and loss adjustment expenses 185,114 0 0 185,114 Cost of goods sold - fasteners 0 0 60,341 60,341 Cost of mineral and filtration sales 0 106,443 0 106,443 Interest expense 0 1,129 1,430 2,559 Corporate administration 139 0 18,755 18,894 --------- --------- --------- --------- Total costs and expenses 282,467 127,436 98,009 507,912 --------- --------- --------- --------- EARNINGS BEFORE INCOME TAXES $ 165,876 $ 10,818 ($ 6,462) 170,232 ========= ========= ========= INCOME TAXES 59,445 --------- NET EARNINGS $ 110,787 =========
SIX MONTHS ENDED JUNE 30, 2003 -------------------------------------------------- ALLEGHANY INSURANCE WORLD CORPORATE HOLDINGS MINERALS ACTIVITIES COMBINED -------- -------- ---------- -------- REVENUES Net fastener sales $ 0 $ 0 $ 55,245 $ 55,245 Interest, dividend and other income 9,210 219 15,662 25,091 Net premiums earned 66,940 0 0 66,940 Net mineral and filtration sales 0 130,908 0 130,908 Net gain (loss) on investment transactions 872 0 3,970 4,842 -------- -------- -------- -------- Total revenues 77,022 131,127 74,877 283,026 COSTS AND EXPENSES Underwriting expenses 28,283 0 0 28,283 Salaries, administrative and other operating expenses 1,477 18,748 17,359 37,584 Loss and loss adjustment expenses 39,668 0 0 39,668 Cost of goods sold - fasteners 0 0 41,568 41,568 Cost of mineral and filtration sales 0 100,121 0 100,121 Interest expense 0 871 1,875 2,746 Corporate administration 0 0 12,783 12,783 -------- -------- -------- -------- Total costs and expenses 69,428 119,740 73,585 262,753 -------- -------- -------- -------- EARNINGS BEFORE INCOME TAXES $ 7,594 $ 11,387 $ 1,292 20,273 ======== ======== ======== INCOME TAXES 6,553 -------- NET EARNINGS $ 13,720 ========
ALLEGHANY CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except share amounts)
JUNE 30, DECEMBER 31, 2004 2003 (unaudited) (audited)* ----------- ---------- ASSETS Available for sale securities at fair value: Equity securities $ 594,206 $ 620,754 Debt securities 1,219,710 917,270 Short-term investments 168,102 135,079 ---------- ---------- 1,982,018 1,673,103 Cash 166,098 231,583 Notes receivable 91,804 92,082 Accounts receivable, net 74,369 75,154 Premium balances receivable 192,486 279,682 Reinsurance receivables 323,856 228,423 Ceded unearned premium reserves 336,188 264,038 Deferred acquisition costs 56,271 47,282 Property and equipment - at cost, net of accumulated depreciation 171,615 177,708 Inventory 88,239 84,612 Goodwill and other intangibles, net of amortization 232,423 233,739 Deferred tax assets 104,822 85,736 Other assets 77,780 94,898 ---------- ---------- $3,897,969 $3,568,040 ========== ========== LIABILITIES AND COMMON STOCKHOLDERS' EQUITY Current taxes payable $ 29,077 $ 49,605 Losses and loss adjustment expenses 684,429 454,664 Other liabilities 242,316 211,000 Reinsurance payable 127,286 255,117 Unearned premiums 773,340 676,940 Subsidiaries' debt 162,585 167,050 Deferred tax liabilities 203,237 190,842 ---------- ---------- Total liabilities 2,222,270 2,005,218 Common stockholders' equity 1,675,699 1,562,822 ---------- ---------- $3,897,969 $3,568,040 ========== ========== COMMON SHARES OUTSTANDING (adjusted for stock dividends) 7,675,313 7,644,232 ========== ==========
* Certain amounts have been reclassified to conform to the 2004 presentation. -----END PRIVACY-ENHANCED MESSAGE-----