-----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, Gd07xEeEugYI+gDb5T1qOWiV+JwojZ7OIme6kAaeOvvsjzQv/goe7syBUV7+m6UW 9Cdvc5CBK2ys22TzWOndIQ== 0000931148-96-000041.txt : 19961101 0000931148-96-000041.hdr.sgml : 19961101 ACCESSION NUMBER: 0000931148-96-000041 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 19960930 FILED AS OF DATE: 19961031 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: UCAR INTERNATIONAL INC CENTRAL INDEX KEY: 0000931148 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRICAL INDUSTRIAL APPARATUS [3620] IRS NUMBER: 061385548 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-13888 FILM NUMBER: 96650788 BUSINESS ADDRESS: STREET 1: 39 OLD RIDGEBURY ROAD STREET 2: J-4 CITY: DANBURY STATE: CT ZIP: 06817 BUSINESS PHONE: 2032077740 MAIL ADDRESS: STREET 1: 39 OLD RIDGEBURY ROAD STREET 2: J-4 CITY: DANBURY STATE: CT ZIP: 06817-0001 10-Q 1 ================================================================================ - -------------------------------------------------------------------------------- FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1996 [ ] 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: (1-13888) UCAR INTERNATIONAL INC. (Exact name of registrant as specified in its charter) DELAWARE 06-1385548 -------- ---------- (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 39 OLD RIDGEBURY ROAD, J-4, DANBURY, CONNECTICUT 06817-0001 - ------------------------------------------------ ---------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (203) 207-7700 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 [ ] As of September 30, 1996, 46,497,915 shares of common stock, par value $.01 per share, were outstanding. - -------------------------------------------------------------------------------- ================================================================================ TABLE OF CONTENTS PART I. FINANCIAL INFORMATION: Item 1. Financial Statements: ----------------------------- Consolidated Balance Sheets as of September 30, 1996 and December 31, 1995............................................ Page 3 Consolidated Statements of Operations for the Three Months Ended September 30, 1996 and 1995 and for the Nine Months Ended September 30, 1996 and 1995...................................... Page 4 Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 1996 and 1995................................ Page 5 Consolidated Statement of Stockholders' Equity (Deficit) for the Nine Months Ended September 30, 1996............................. Page 7 Notes to Consolidated Financial Statements........................ Page 8 Item 2. Management's Discussion and Analysis of Financial Condition ------------------------------------------------------------------- and Results of Operations................................... Page 12 ------------------------- PART II. OTHER INFORMATION: Item 6. Exhibits and Reports on Form 8-K.......................... Page 18 ------------------------------------------ SIGNATURE.............................................................. Page 19 INDEX TO EXHIBITS...................................................... Page E-1 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS - ---------------------------- UCAR INTERNATIONAL INC. AND SUBSIDIARIES Consolidated Balance Sheets (Dollars in millions, except per share data ) September 30, December 31, ASSETS 1996 1995 ---- ---- (Unaudited) Current assets: Cash and cash equivalents......................... $ 91 $ 53 Notes and accounts receivable..................... 176 180 Inventories: Raw materials and supplies..................... 35 28 Work in process................................ 97 78 Finished goods................................. 39 30 ------- ------ 171 136 Prepaid expenses.................................. 37 34 ------- ------ Total current assets...................... 475 403 ------- ------ Property, plant and equipment....................... 1,036 1,013 Less: accumulated depreciation...................... 656 635 ------- ------ Net fixed assets.......................... 380 378 ------- ------ Company carried at equity........................... 16 18 Other assets........................................ 42 65 ------- ------ Total assets.............................. $ 913 $ 864 ======= ====== LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) Current liabilities: Accounts payable.................................. $ 46 $ 56 Short-term debt................................... 37 31 Payments due within one year on long-term debt.... 1 1 Accrued income and other taxes.................... 42 50 Other accrued liabilities......................... 78 90 ------- ------ Total current liabilities................. 204 228 ------- ------ Long-term debt...................................... 596 636 Other long-term obligations......................... 132 137 Deferred income taxes............................... 17 20 Minority stockholders' equity in consolidated entities.......................................... 4 5 Common stock subject to "puts"...................... - 8 Less: related loans to management.................. - (3) ------- ------ Stockholders' equity (deficit): Preferred stock - par value $.01; authorized - 10,000,000 shares; issued - none............. - - Common stock - par value $.01; authorized - 100,000,000 shares; issued - 46,497,915 shares....................................... - - Additional paid-in capital.......................... 496 485 Cumulative foreign currency translation adjustment.. (115) (116) Retained earnings (deficit)......................... (421) (536) ------- ------ Total stockholders' equity (deficit)........ (40) (167) ------- ------ Total liabilities and stockholders' equity (deficit)........................ $ 913 $ 864 ======= ====== See accompanying Notes to Consolidated Financial Statements. 3 PART I (Cont.) UCAR INTERNATIONAL INC. AND SUBSIDIARIES Consolidated Statements of Operations (Dollars in millions, except per share data) (Unaudited)
Three Months Nine Months Ended September 30, Ended September 30, ------------------- ------------------- 1996 1995 1996 1995 ---- ---- ---- ---- Net sales .................................................................... $ 227 $ 220 $ 711 $ 657 Cost of sales ................................................................ 141 136 436 411 -------- -------- -------- -------- Gross profit ................................................................. 86 84 275 246 Research and development ..................................................... 2 2 6 5 Selling, administrative and other expenses ................................... 21 39 66 87 Restructuring costs .......................................................... - - - 30 Other (income) expense (net) ................................................. - (2) 1 (4) -------- -------- -------- -------- Operating profit ........................................................ 63 45 202 128 Interest expense ............................................................. 16 26 47 75 -------- -------- -------- -------- Income before provision for income taxes ................................ 47 19 155 53 Provision for income taxes ................................................... 14 8 52 60 -------- -------- -------- -------- Income (loss) of consolidated entities .................................. 33 11 103 (7) Less: minority stockholders' share of income ................................. - 1 - 4 Plus: UCAR share of net income from company carried at equity ................ 2 3 5 5 -------- -------- -------- -------- Income (loss) before extraordinary charge and cumulative effect of change in accounting principles ............................. 35 13 108 (6) Extraordinary charge, net of tax ............................................. - 16 - 18 -------- -------- -------- -------- Income (loss) before cumulative effect of change in accounting principles ................................................. 35 (3) 108 (24) Cumulative effect on prior years of change in accounting for inventories ..... - - 7 - -------- -------- -------- -------- Net income (loss) ..................................................... $ 35 $ (3) $ 115 $ (24) ======== ======== ======== ======== Primary net income per common share (Note 7) (Pro forma in 1995): Income before cumulative effect of change in accounting principles ........ $ 0.72 $ 0.58 $ 2.22 $ 1.22 Cumulative effect on prior years of change in accounting for inventories... - - 0.15 - -------- -------- -------- -------- Primary net income per share .......................................... $ 0.72 $ 0.58 $ 2.37 $ 1.22 ======== ======== ======== ======== Weighted average common shares outstanding (Pro forma in 1995) (in thousands) .................................. 48,619 48,759 48,405 48,693 ======== ======== ======== ========
See accompanying Notes to Consolidated Financial Statements. 4 PART I (Cont.) UCAR INTERNATIONAL INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows Increase in Cash and Cash Equivalents (Dollars in millions) (Unaudited) Nine Months Ended September 30, ------------------- 1996 1995 ---- ---- Cash flow from operating activities: Net income (loss) ........................................ $ 115 $ (24) Extraordinary charge, net of tax ......................... - 18 Cumulative effect on prior years of change in accounting for inventories ............................ (7) - Non-cash (credits) charges to net income (loss): Depreciation ........................................... 28 30 Deferred income taxes .................................. 17 (8) Restructuring costs .................................... - 30 Vesting of performance stock options ................... - 19 Other non-cash charges ................................. 10 1 Working capital * ........................................ (53) (12) Long-term assets and liabilities ......................... (5) 9 ----- ----- Net cash provided by operating activities ............ 105 63 ----- ----- Cash flow from investing activities: Capital expenditures ..................................... (37) (44) Purchase of minority shares in subsidiary ................ (3) (53) Redemption/sale of assets ................................ 1 2 ----- ----- Net cash used in investing activities ................ (39) (95) ----- ----- Cash flow from financing activities: Short-term debt .......................................... 6 (13) Long-term debt borrowings ................................ 2 960 Long-term debt reductions ................................ (42) (477) Financing costs .......................................... (1) (64) Sale of common stock, net of loans to management ......... 7 427 Cash distribution to stockholders ........................ - (756) ----- ----- Net cash (used in) provided by financing activities .. (28) 77 ----- ----- Net increase in cash and cash equivalents ................. 38 45 Effect of exchange rate changes on cash and cash equivalents ............................... - (3) Cash and cash equivalents at beginning of period .......... 53 60 ----- ----- Cash and cash equivalents at end of period ................ $ 91 $ 102 ===== ===== (Continued) 5 PART I (Cont.) UCAR INTERNATIONAL INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows, Continued Nine Months Ended September 30, ------------------- 1996 1995 ---- ---- Supplemental disclosures of cash flow information: Net cash paid during the periods for: Interest expense ....................................... $ 46 $ 60 Income taxes ........................................... 39 26 *Net change in working capital by component (excluding cash and cash equivalents, deferred income taxes and short-term debt): (Increase) decrease in current assets: Notes and accounts receivable: Sale of receivables .............................. $ 3 $ - Other changes .................................... (2) (11) Inventories .......................................... (25) (11) Prepaid expenses and other current assets ............ 4 - Increase (decrease) in payables and accruals ............ (33) 10 ---- ---- Working capital .................................. $(53) $(12) ==== ==== See accompanying Notes to Consolidated Financial Statements. 6 PART I (Cont.) UCAR INTERNATIONAL INC. AND SUBSIDIARIES Consolidated Statement of Stockholders' Equity (Deficit) Nine Months Ended September 30, 1996 (Dollars in millions) (Unaudited)
Cumulative Foreign Additional Currency Retained Total Common Paid-in Translation Earnings Stockholders' Stock Capital Adjustment (Deficit) Equity (Deficit) ----- ------- ---------- --------- ---------------- Balance at December 31, 1995................... $ - $ 485 $ (116) $ (536) $ (167) Exercise of employee stock options............. - 4 - - 4 Tax benefit arising from exercise of employee stock options................... - 3 - - 3 Reclassification of: Common stock subject to "puts"............. - 8 - - 8 Related loans to management................ - (3) - - (3) Registration cost of offering................. - (1) - - (1) Translation adjustments....................... - - 1 - 1 Net income.................................... - - - 115 115 ----- ------ ------- ----- ------- Balance at September 30, 1996................. $ - $ 496 $ (115) $ (421) $ (40) ===== ====== ======= ======= =======
See accompanying Notes to Consolidated Financial Statements. 7 PART I (Cont.) UCAR INTERNATIONAL INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Cont.) (Unaudited) (1) INTERIM FINANCIAL PRESENTATION The interim Consolidated Financial Statements are unaudited; however, in the opinion of management, they have been prepared in accordance with Rule 10-01 of Regulation S-X adopted by the Securities and Exchange Commission ("Commission") and reflect all adjustments (all of which are of a normal, recurring nature) which are necessary for a fair statement of the financial condition, results of operations, cash flows and changes in stockholders' equity (deficit) for the periods presented. Results of operations for the nine months ended September 30, 1996 are not necessarily indicative of the results that may be expected for the entire fiscal year ending December 31, 1996. As used in these Notes, references to "UCAR" mean UCAR International Inc., to "Global" mean UCAR Global Enterprises Inc., a direct, wholly-owned subsidiary of UCAR, and to the "Company" mean UCAR and its subsidiaries (including Global), collectively. Separate financial statements of Global are not presented because they would not be material to holders of senior subordinated notes. The Company's investment in EMSA (Pty.) Ltd. ("EMSA"), a 50%-owned company, is carried on the equity basis and its proportional share of the net income of EMSA is reported under the caption "UCAR share of net income from company carried at equity". At September 30, 1996, retained earnings (deficit) included $37 million representing UCAR's share of the undistributed earnings (prior to foreign currency translation adjustment) of EMSA. (2) UCAR GLOBAL ENTERPRISES INC. UCAR has no material assets, liabilities or operations other than those that result from its ownership of 100% of the outstanding common stock of Global. The following is a summary of the consolidated assets and liabilities of Global and its subsidiaries at September 30, 1996 and December 31, 1995 and their consolidated results of operations for the three month and nine month periods ended September 30, 1996 and 1995: September 30, December 31, 1996 1995 ---- ---- (Dollars in millions) Assets: Current assets ............................ $ 475 $ 403 Non-current assets ........................ 438 461 ------ ------ Total assets ........................... $ 913 $ 864 ====== ====== Liabilities: Current liabilities ....................... $ 204 228 Non-current liabilities ................... 745 793 ------ ------ Total liabilities ...................... $ 949 $1,021 ====== ====== Minority stockholders' equity in consolidated entities .................. $ 4 $ 5 ====== ====== 8 PART I (Cont.) UCAR INTERNATIONAL INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Cont.) (Unaudited) Three Months Nine Months Ended September 30, Ended September 30, ------------------- ------------------- 1996 1995 1996 1995 ---- ---- ---- ---- (Dollars in millions) Net sales ............................ $ 227 $ 220 $ 711 $ 657 Gross profit ......................... 86 84 275 246 Income (loss) before extraordinary charge and cumulative effect of change in accounting principles .... 35 13 108 (6) Net income (loss) .................... 35 (3) 115 (24) (3) CHANGE IN ACCOUNTING FOR INVENTORIES Effective January 1, 1996, the Company changed its method of determining LIFO inventories. The new methodology provides specifically identified parameters for defining new items within the LIFO pool which the Company believes improves the accuracy of costing those items. The Company recorded income of $7 million (after related income taxes of $4 million) as the cumulative effect on prior years of this change in accounting for inventories. The Company believes this change will not materially impact the Company's ongoing results of operations. (4) INCOME TAXES In connection with the leveraged recapitalization of the Company in January 1995 ("Recapitalization"), certain foreign subsidiaries borrowed and repatriated funds to the United States. In the three months ended March 31, 1995, the Company recorded a tax liability of $37 million in connection therewith. (5) RESTRUCTURING COSTS The Company recorded restructuring costs of $30 million in the three months ended March 31, 1995 to write-off fixed assets of $22 million and accrue $8 million of related shutdown costs in connection with a project to close certain high cost manufacturing operations and to add modern lower cost manufacturing operations at the Company's North American graphite electrode plants. 9 PART I (Cont.) UCAR INTERNATIONAL INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Cont.) (Unaudited) (6) OTHER (INCOME) EXPENSE - NET The following is an analysis of other (income) expense (net): Three Months Nine Months Ended September 30, Ended September 30, ------------------- ------------------- 1996 1995 1996 1995 ---- ---- ---- ---- (Dollars in millions) Foreign currency adjustments........... $ - $ 3 $ 1 $ (1) Interest income ....................... (2) (6) (7) (19) Loss on sales and disposals of assets.. - - 1 1 Brazilian monetary correction ......... - - - 2 Bank fees due to Recapitalization ..... 1 - 1 7 Other ................................. 1 1 5 6 ---- ---- ---- ---- $ - $ (2) $ 1 $ (4) ==== ===== ==== ==== (7) EARNINGS PER SHARE Primary Net Income Per Share Primary net income per share is computed by dividing net income by the weighted average number of common shares outstanding during the period. The weighted average number of common shares outstanding includes common stock equivalents calculated in accordance with the "treasury stock method," wherein the net proceeds from the exercise thereof are assumed to be used to repurchase outstanding shares of common stock at the average market price for the period. Fully diluted earnings per share is not significantly different than primary net income per share and, therefore, has not been presented. Pro Forma Net Income Per Share For the unaudited pro forma net income per share data presented on the Consolidated Statements of Operations, historical net loss for the three month and nine month periods ended September 30, 1995 has been adjusted as if the Recapitalization and the Company's initial public offering ("Initial Offering"), redemption of senior subordinated notes ("Redemption") and refinancing of credit facilities ("Refinancing") had occurred as of January 1, 1995 and to exclude the extraordinary charge and the non-recurring effects of the Recapitalization and the Initial Offering. The weighted average number of common shares outstanding reflects shares of common stock outstanding after the Initial Offering, including common stock equivalents calculated in accordance with the "treasury stock method," wherein the net proceeds from the exercise thereof are assumed to be used to repurchase outstanding shares of common stock at $25.80 (the average price for the three 10 PART I (Cont.) UCAR INTERNATIONAL INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Cont.) (Unaudited) months ended September 30, 1995) and $24.42 (the average price for the nine months ended September 30, 1995). The following table is a summary of the pro forma adjustments to net loss for the periods presented:
Three Months Nine Months Ended September 30, Ended September 30, ------------------- ------------------- 1995 1995 ---- ---- (Dollars in millions) Net loss as reported in the Consolidated Financial Statements ............ $ (3) $(24) Pro forma effects of the Recapitalization (after tax): Compensation expense related to the Company's long term incentive compensation plan................................. - 1 Senior subordinated credit facility expense.......................... - 4 Net adjustment to interest........................................... - (3) Taxes due to Recapitalization ....................................... - 37 Pro forma effects of the Initial Offering and Redemption (after tax): Accelerated vesting of performance stock options and matching shares.............................................. 12 12 Net adjustment to interest........................................... 2 9 Extraordinary charge................................................. 16 18 Pro forma effects of the Refinancing (after tax): Net adjustment to interest........................................... 2 6 ---- ---- Pro forma net income...................................................... $ 29 $ 60 ==== ====
11 PART I (Cont.) UCAR INTERNATIONAL INC. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS - -------------------------------------------------------------------------------- OF OPERATIONS ------------- GENERAL As used herein, references to "UCAR" mean UCAR International Inc., to "Global" mean UCAR Global Enterprises Inc., a direct, wholly-owned subsidiary of UCAR, and to the "Company" mean UCAR and its subsidiaries (including Global), collectively. On January 26, 1995, the Company consummated a leveraged recapitalization ("Recapitalization"). On August 15, 1995, UCAR completed an initial public offering ("Initial Offering") of its common stock, par value $.01 per share ("Common Stock"). On September 11, 1995, the Company acquired substantially all of the outstanding common stock of its Brazilian subsidiary, UCAR Carbon S.A., held by public shareholders in Brazil. On September 15, 1995, the Company redeemed $175 million aggregate principal amount of Senior Subordinated Notes ("Subordinated Notes") at a redemption price equal to 110% of the aggregate principal amount thereof, plus accrued interest thereon of approximately $4 million ("Redemption"). On October 19, 1995, the Company refinanced its existing credit facilities ("Recapitalization Bank Facilities") and entered into new credit facilities ("Senior Bank Facilities") at more favorable interest rates and with more favorable covenants. In March 1996, certain stockholders of UCAR sold an aggregate of 16,675,000 shares of Common Stock in a secondary public offering ("Secondary Offering"). In the Secondary Offering, Blackstone Capital Partners II Merchant Banking Fund L.P. and its affiliates (collectively, "Blackstone"), Chemical Equity Associates and certain members of management sold approximately 15,449,000 shares, 826,000 shares and 400,000 shares, respectively. After the Secondary Offering, Blackstone owned approximately 20% of the outstanding shares of Common Stock. UCAR did not sell any shares in the Secondary Offering and did not receive any proceeds from the shares sold by the selling stockholders. Approximately 193,000 of the shares sold by management consisted of shares issued upon the exercise of vested stock options concurrently with the Secondary Offering and the Company received proceeds of approximately $1.5 million from the exercise of such options. RESULTS OF OPERATIONS Three Month and Nine Month Periods Ended September 30, 1996 as Compared to Three Month and Nine Month Periods Ended September 30, 1995 Net sales of $227 million in the third quarter of 1996 ("1996 Third Quarter") represent a 3% increase over net sales of $220 million in the third quarter of 1995 ("1995 Third Quarter"). Graphite electrode sales were $166 million in the 1996 Third Quarter as compared to $165 million in the 1995 Third Quarter. While net sales of graphite electrodes remained flat, the volume of graphite electrodes sold declined 6% to 49,000 metric tons in the 1996 Third Quarter from 52,000 metric tons in the 1995 Third Quarter. This decline was primarily due to a reduction in shipments in Western Europe and in some export markets as customers drew down on inventories previously built-up as a result of a reduction in steel shipments. The average selling price (in dollars and net of changes in currency exchange rates) for 12 PART I (Cont.) UCAR INTERNATIONAL INC. the Company's graphite electrodes rose by 4% per metric ton in the 1996 Third Quarter as compared to the 1995 Third Quarter. Net sales of graphite specialty products in the 1996 Third Quarter increased 15% to $30 million from $26 million in the 1995 Third Quarter. This increase was primarily due to strong demand in all its product lines and a 6% price increase (in dollars) which became effective on January 1, 1996. Net sales of carbon specialty products were $22 million in the 1996 Third Quarter as compared to $21 million in the 1995 Third Quarter. Net sales of Grafoil(Registered) were $9 million in the 1996 Third Quarter as compared to $7 million in the 1995 Third Quarter. Strong demand for Grafoil(Registered) gaskets in the transportation industry was the main reason for the increase. Net sales in the nine months ended September 30, 1996 (the "1996 Period") were $711 million, an increase of 8% over net sales of $657 million in the nine months ended September 30, 1995 (the "1995 Period"). Net sales of graphite electrodes were $519 million in the 1996 Period as compared to $492 million in the 1995 Period. The volume of graphite electrodes sold declined by 5,700 metric tons, or 4%, in the 1996 Period as compared to the 1995 Period, primarily for the reason described above. The average selling price (in dollars and net of changes in currency exchange rates) for the Company's graphite electrodes rose by 7% per metric ton in the 1996 Period as compared to the 1995 Period. Net sales of graphite specialty products in the 1996 Period increased 19% to $94 million from $79 million in the 1995 Period, due to both increased demand and selling price. Net sales of carbon specialty products increased 20% to $71 million in the 1996 Period from $59 million in the 1995 Period. This increase was due primarily to the 6% price increase described above. Net sales of Grafoil(Registered) were $27 million in the 1996 Period as compared to $26 million in the 1995 Period. Cost of sales increased 4% to $141 million in the 1996 Third Quarter from $136 million in the 1995 Third Quarter. This increase was primarily due to the increased volume of carbon specialty and graphite specialty products sold. In the 1996 Period, cost of sales increased 6% to $436 million from $411 million in the 1995 Period, also due primarily to the increased volume of carbon specialty and graphite specialty products sold. As a result of the changes described above, the Company's gross profit margin decreased to 37.9% in the 1996 Third Quarter from 38.2% in the 1995 Third Quarter. In the 1996 Period, gross profit margin increased to 38.7% from 37.4% in the 1995 Period. Selling, administrative and other expenses decreased to $21 million in the 1996 Third Quarter from $39 million in the 1995 Third Quarter. For the 1996 Period, selling, administrative and other expenses decreased to $66 million from $87 million in the 1995 Period. These decreases are primarily due to the fact that there was an $18 million expense in the 1995 Third Quarter as a result of the accelerated vesting of performance stock options and restricted matching stock while there was no such charge in the 1996 Period. Restructuring costs of $30 million were incurred in the 1995 Period in connection with a project, approved by UCAR's Board of Directors in January 1995, which involved the closure of certain high cost manufacturing operations and the addition of modern lower cost manufacturing operations at the Company's North American graphite electrode plants ("Rationalization Project"). The Rationalization 13 PART I (Cont.) UCAR INTERNATIONAL INC. Project is expected to yield approximately $23 million in annual cost savings, with approximately $20 million expected to be realized in 1996 and the full $23 million expected to be realized in 1997 (in each case, as compared to 1994). These restructuring costs include fixed asset write-offs of $22 million and $8 million of facility closing expenses and environmental clean-up costs. Except for the Rationalization Project, no restructuring costs were incurred in the 1995 Period or the 1996 Period. Other (income) expense (net) was nil in the 1996 Third Quarter as compared to income of $2 million in the 1995 Third Quarter. This change was primarily due to a $4 million decrease in interest income and a $3 million increase in exchange gains on transactions denominated in foreign currencies. Certain hedge transactions have been implemented to mitigate the currency exposure for the Company on a global basis. Other (income) expense (net) for the 1996 Period was $1 million of expense as compared to income of $4 million for the 1995 Period. The major changes between the 1996 Period and the 1995 Period were a $12 million decrease in interest income and a $6 million expense in the 1995 Period associated with a back-up senior subordinated credit facility provided by Chemical Bank in connection with the Recapitalization. Operating profit in the 1996 Third Quarter was $63 million (27.8% of net sales) as compared to $45 million (20.5% of net sales) in the 1995 Third Quarter. In the 1996 Period, operating profit was $202 million (28.4% of net sales) as compared to $128 million (19.5% of net sales) in the 1995 Period. Excluding the restructuring costs of $30 million, the nonrecurring expense of $6 million associated with the senior subordinated credit facility, the $18 million included in selling, administrative and other expenses as result of accelerated vesting of performance stock options and restricted matching stock and the $2 million included in other expenses due to accelerated payments under the Company's long term incentive compensation plan which were accelerated as a result of the Recapitalization, operating profit in the 1995 Period would have been $184 million (28.0% of net sales). Interest expense decreased to $16 million in the 1996 Third Quarter from $26 million in the 1995 Third Quarter. The average outstanding total debt in the 1996 Third Quarter was $634 million as compared to $866 million in the 1995 Third Quarter, and the average annual interest rate in the 1996 Third Quarter was 9.7% as compared to 11.3% in the 1995 Third Quarter. Interest expense decreased to $47 million in the 1996 Period as compared to $75 million in the 1995 Period. The average outstanding total debt was $649 million and the average annual interest rate was 9.6% in the 1996 Period as compared to an average outstanding total debt of $855 million and an average annual interest rate of 10.8% in the 1995 Period. The provision for income taxes was $14 million in the 1996 Third Quarter as compared to $8 million in the 1995 Third Quarter. The increase was primarily due to higher pre-tax income, partially offset by reductions of deferred tax valuation allowances. The provision for income taxes was $52 million in the 1996 Period as compared to $60 million in the 1995 Period. The decrease was primarily due to the fact that there were taxes of approximately $37 million in the 1995 Period associated with the Recapitalization which were not incurred in the 1996 Period, partially offset by the effect of higher pre-tax income. 14 PART I (Cont.) UCAR INTERNATIONAL INC. LIQUIDITY AND CAPITAL RESOURCES Debt At September 30, 1996, the Company had total debt of $634 million as compared to $668 million at December 31, 1995. The Company had a stockholders' deficit of $40 million at September 30, 1996 as compared to $167 million at December 31, 1995. Inventory Levels and Working Capital Inventory levels at any specified date are affected by increases in inventories of raw materials to meet anticipated increases in sales of finished products, customer buy-ins and other factors affecting net sales from quarter to quarter. Inventory levels increased to $171 million at September 30, 1996 from $136 million at December 31, 1995. This increase was primarily due to an $11 million LIFO accounting method change, a $4 million temporary build-up of inventory in North America due to the Rationalization Project and a $20 million increase of inventory in Europe as a result of a reduction in graphite electrode shipments in Western Europe and some export markets described above. The Company's working capital increased to $271 million at September 30, 1996 from $175 million at December 31, 1995. The increase was primarily due to the increase in inventory described above, a decrease of $24 million in current liabilities and a $38 million increase in cash and cash equivalents. Cash and cash equivalents at September 30, 1996 included $40 million held by the Company's Brazilian subsidiary. Capital Expenditures Capital expenditures aggregated $37 million (including $4 million for the Rationalization Project) in the 1996 Period as compared to $44 million (including $19 million for the Rationalization Project) in the 1995 Period. Capital expenditures have been and will be made during 1996 to maintain existing facilities and equipment, to achieve cost savings and to improve operating efficiency (including the Rationalization Project and other restructuring and reengineering projects). The Company expects capital expenditures in 1996 to total approximately $60 million (including expenditures relating to the Rationalization Project which were pre-funded as part of the Recapitalization). Capital expenditures for environmental protection have not been and are not expected to be a significant factor with respect to the Company's capital expenditures as a whole. Acquisitions On September 11, 1996, the Company announced its intention to pursue the purchase of a controlling interest in Graphite PLC, which operates a graphite electrode business in Viazma, Russia. The Company intends to purchase Graphite PLC through a tender offer to its major shareholders, which include members of the board of directors and employees of Graphite PLC. It is anticipated that the transaction will be completed by December 31, 1996. The total estimated investment is $50 million and includes 15 PART I (Cont.) UCAR INTERNATIONAL INC. the purchase of shares, a working capital infusion, the assumption of certain short-term debt and other expenses. On May 21, 1996, the Company announced its intention to pursue the purchase of 70% of the outstanding shares of Carbone Savoie, S.A., a wholly-owned subsidiary of a competitor and a manufacturer of carbon cathode blocks. While the final purchase price will not be determined until after satisfactory completion of due diligence, it is estimated that the purchase price will not exceed 200 million French Francs. Both acquisitions are subject to satisfaction of a number of conditions, including receipt of governmental approvals. The Company intends to finance both acquisitions from existing cash, cash flow from operations and borrowings under its revolving credit facility. Restrictions on Dividends and Distributions Under the Senior Bank Facilities, UCAR and Global are generally permitted to pay dividends to their respective stockholders only in an annual amount up to the greater of $15 million or a specified percentage of adjusted consolidated net income. The indenture relating to the Subordinated Notes restricts the payment of dividends by Global to UCAR if (a) at the time of such proposed dividend, Global is unable to meet certain indebtedness incurrence and income tests or (b) the total amount of the dividend paid exceeds specified aggregate limits based on consolidated net income and net proceeds from asset and stock sales and certain other transactions. Such restrictions are not applicable to dividends (i) in respect of UCAR's administrative fees and expenses and (ii) for the specific purpose of the purchase or redemption by UCAR of capital stock held by present or former officers of the Company up to $5 million per year or $25 million in the aggregate. CHANGES IN ACCOUNTING PRINCIPLES Effective January 1, 1996, the Company changed its method of determining LIFO inventories. The new methodology provides specifically identified parameters for defining new items within the LIFO pool which the Company believes improves the accuracy of costing those items. The Company recorded income of $7 million (after related income taxes of $4 million) as the cumulative effect on prior years of this change in accounting for inventories. The Company believes this change will not materially impact the Company's ongoing results of operations. In October 1995, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards ("SFAS") 123, "Accounting for Stock-Based Compensation" which is effective for years beginning after December 15, 1995. SFAS 123 permits a fair value based method of accounting for employee stock compensation plans. It also allows a company to continue to use the intrinsic value method of accounting prescribed by Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" ("APB 25"). Companies electing to continue to use the accounting prescribed by 16 PART I (Cont.) UCAR INTERNATIONAL INC. APB 25 must make pro forma disclosures of net income and net income per share as if the fair value based method of accounting defined in SFAS 123 had been applied. The Company intends to continue the method of accounting for stock-based compensation prescribed by APB 25; accordingly, the adoption of SFAS 123 will have no effect on the Company with the exception of expanded disclosures required under SFAS 123. 17 PART II. OTHER INFORMATION UCAR INTERNATIONAL INC. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - ------------------------------------------ (a) EXHIBITS The exhibits listed in the following table have been filed as part of this Quarterly Report on Form 10-Q. Exhibit Number Description of Exhibit ------ ---------------------- 10.28(a) Third Amendment to UCAR International Inc. Compensation Deferral Program effective as of January 1, 1996 10.41(b) First Amendment to The UCAR Carbon Retirement Plan effective February 25, 1991 10.41(c) Third Amendment to such Retirement Plan effective, as to paragraph 2, as of January 26, 1995 and as to paragraphs 1 and 3-5, as of January 1, 1997 10.50(a) Second Amendment to UCAR International Inc. Benefits Protection Trust effective as of January 1, 1996 11 Statement re: computation of per share earnings 27 Financial Data Schedule (b) Reports on Form 8-K No Report on Form 8-K was filed during the quarter for which this Quarterly Report on Form 10-Q is filed. 18 UCAR INTERNATIONAL INC. SIGNATURE Pursuant to the requirement 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. UCAR INTERNATIONAL INC. Date: October 31, 1996 By: /s/ William P. Wiemels ---------------------- William P. Wiemels Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer) 19 UCAR INTERNATIONAL INC. INDEX TO EXHIBITS Exhibit No. Description Page 10.28(a) Third Amendment to UCAR International Inc. Compensation Deferral Program effective as of January 1, 1996............ E-2 10.41(b) First Amendment to The UCAR Carbon Retirement Plan effective February 25, 1991................................. E-4 10.41(c) Third Amendment to such Retirement Plan effective, as to paragraph 2, as of January 26, 1995 and as to paragraphs 1 and 3-5, as of January 1, 1997.............................. E-6 10.50(a) Second Amendment to UCAR International Inc. Benefits Protection Trust effective as of January 1, 1996............ E-8 11 Statement re: computation of per share earnings............. E-11 27 Financial Data Schedule..................................... E-12 E-1 EX-10.28(A) 2 THIRD AMENDMENT TO UCAR INTERNATIONAL INC. COMPENSATION DEFERRAL PROGRAM EFFECTIVE AS OF JANUARY 1, 1996 EXHIBIT 10.28(a) THIRD AMENDMENT TO THE UCAR INTERNATIONAL INC. COMPENSATION DEFERRAL PROGRAM ----------------------------- The UCAR International Inc. Compensation Deferral Program (the "Plan") is hereby amended as follows: 1. Section 2.3 of the Plan is amended in its entirety to read as follows: "2.3 "Officers Plan" means the UCAR International Inc. Officers Incentive Plan, as amended from time to time." 2. Section 2.21 of the Plan is amended in its entirety to read as follows: "2.21 "Management Plan" means the UCAR International Inc. Management Incentive Plan, as amended from time to time." 3. Section 2.10 of the Plan is amended in its entirety to read as follows: "2.10 "Organization and Compensation Committee" means the Organization and Compensation Committee of the Board of Directors of the Corporation." 4. A new Section 2.32 is added to the Plan to read as follows: "2.32 "ERIP" means the UCAR Carbon Company Inc. Employee Retirement Income Plan, as amended from time to time." 5. Section 2.31 of the Plan is amended in its entirety to read as follows: "2.31 "Variable Compensation Plans" means collectively, the Bonus II Plan, the Long Term Plan, Management Plan, Officers Plan and any other variable compensation plan authorized by the Organization and Compensation Committee to participate in the Program." 6. Section 5.2(c) of the Plan is amended by adding the words "the ERIP" immediately following the words " the SRIP". E-2 7. Sections 5.3(a) and 5.3(b) of the Plan are amended by adding the words "the ERIP" immediately following the words "the SRIP". 8. Section 9.3 of the Plan is amended by adding the words "the ERIP" immediately following the words "the SRIP". 9. All references in the Plan to the "Annual Plan" are hereby amended to read "Officers Plan". 10. All references in the Plan to the "Mid-Management Plan" are hereby amended to read "Management Plan". 11. All references in the Plan to the "Compensation Committee" are hereby amended to read "Organization and Compensation Committee". 12. The provisions of this Second Amendment shall be effective as of January 1, 1996. Dated: July 9, 1996 UCAR INTERNATIONAL INC. By: /s/ P. B. Mancino ------------------ E-3 EX-10.41(B) 3 FIRST AMENDMENT TO THE UCAR CARBON RETIREMENT PLAN EFFECTIVE FEBRUARY 25, 1991 EXHIBIT 10.41(b) FIRST AMENDMENT TO THE UCAR CARBON RETIREMENT PLAN --------------------------- The UCAR Carbon Retirement Plan (the "Plan") is amended as follows: 1. Section 2.5.(h) of the Plan is amended and restated in its entirety to read as follows: "(h) Any individual who becomes a part-time or temporary employee, unless such individual's employment status is changed from full-time to part-time by action of an Employer. For purposes of this Section 2.5(h), any individual who is scheduled to work (and actually works) no more than 999 hours a year will be considered a part-time employee. Any individual hired to work of a temporary nature without the intention of re-employing such individual intermittently will be considered a temporary employee". 2. Section 8.4. of the Plan is amended by inserting the following new subsection (c) at the end thereof: "(c) Limitations on Adjustments. --------------------------- (i) Except as provided in subparagraph (ii) below for purposes of adjusting any benefit for limitation under Section 8.4(a) of this Plan, the interest rate assumption shall not be less than the greater of 5 percent or the rate provided in Section 1.2 of this Plan. (ii) For purposes of adjusting the benefit or limitation of any form of benefit subject to Code Section 417(e)(3), the applicable interest rate (as defined in Code Section 417(e)(3)) shall be substituted for 5 percent. (iii) For purposes of adjusting any limitation under Section 8.4(b) of this Plan, the interest rate assumption shall not be the greater of the lesser of 5% of the rate specified in Section 1.2 of this Plan. (iv) For purposes of this Section 8.4(c), no adjustments under Code Section 415(d)(1) shall be taken into account before the year for which such adjustment first takes effect. (v) For purposes of adjusting any benefit or limitation under this Section 8.4, the mortality table used shall be the table prescribed by the secretary. Such table shall be based on the prevailing commissioners' standard table used to E-4 determine reserves for group annuity contracts issued on the date the adjustment is being made. 3. The provisions of this First Amendment shall be effective as of February 25, 1991. UCAR CARBON COMPANY INC. By: /s/ John C. Arnold ------------------- -2- E-5 EX-10.41(C) 4 THIRD AMENDMENT TO SUCH RETIREMENT PLAN EFFECTIVE, AS TO PARAGRAPH 2, AS OF JANUARY 26, 1995 AND AS TO PARAGRAPHS 1 AND 3-5, AS OF JANUARY 1, 1997 EXHIBIT 10.41(c) THIRD AMENDMENT TO THE UCAR CARBON RETIREMENT PLAN --------------------------- The UCAR Carbon Retirement Plan (the "Plan") is hereby amended as follows: 1. Section 5.6 of the Plan is amended by deleting therefrom the phrase "in accordance with the actuarial factors set forth in Table 4, which is attached hereto and made a part of the Plan" and replacing such language with the following: "using the annual interest rate on 30-year Treasury securities effective for August of the calendar year preceding the date of determination, and the applicable mortality table based upon a fixed blend of 50 percent of the male mortality rates and 50 percent of the female mortality rates from the 1983 Group Annuity Mortality Table or such other applicable table prescribed by the Secretary pursuant to Code Section 417(e)(3)." 2. The following language is added to Section 7.1 of the Plan: "With respect to a deceased Participant who (i) was entitled to a Disability Retirement Benefit under this Plan (including where such benefit has been converted to a Normal Retirement Benefit), (ii) is entitled to a Qualified Joint and Survivor Annuity under this Plan, (iii) was entitled to a retirement benefit under the Retirement Program Plan for Employees of Union Carbide Corporation and its Participating Subsidiary Companies ("UCC Plan"), and (iv) did not elect to provide for a survivor benefit under the UCC Plan, the term Accrued Benefit, solely for purposes of this Article VII, shall mean that Participant's Accrued Benefit as determined under Article V, but without taking any offset for such Participant's UCC Plan benefit." 3. Section 7.6 of the Plan is hereby amended by deleting the last paragraph thereof and replacing it with the following: "Such lump sum shall be determined by using the annual interest rate on 30-year Treasury securities for the second month before the date of distribution, and the applicable mortality table based upon a fixed blend E-6 of 50 percent of the male mortality rates and 50 percent of the female mortality rates from the 1983 Group Annuity Mortality Table or such other applicable table prescribed by the Secretary pursuant to Code Section 417(e)(3)." 4. Section 9.2 of the Plan is hereby amended by replacing the last sentence of the first paragraph with the following: "The lump sum Actuarial Equivalent of a Participant's Retirement Benefit shall be calculated, both for purposes of determining if the benefit payable is less than $3,500 and for purposes of computing such Retirement Benefit, using the annual interest rate on 30-year Treasury securities for the second month before the date of distribution, and the applicable mortality table based upon a fixed blend of 50 percent of the male mortality rates and 50 percent of the female mortality rates from the 1983 Group Annuity Mortality Table or such other applicable table prescribed by the Secretary pursuant to Code Section 417(e)(3)." 5. The Plan is further amended by deleting Table 4 therefrom. 6. The provisions of paragraph 2 of this Third Amendment shall be effective as of January 26, 1995. 7. The provisions of paragraphs 1 and 3-5 of this Third Amendment to the Plan shall be effective as of January 1, 1997. UCAR CARBON COMPANY INC. By:/s/ John C. Arnold ------------------ -2- E-7 EX-10.50(A) 5 SECOND AMENDMENT TO UCAR INTERNATIONAL INC. BENEFITS PROTECTION TRUST EFFECTIVE AS OF JANUARY 1, 1996 EXHIBIT 10.50(a) SECOND AMENDMENT TO THE UCAR INTERNATIONAL INC. BENEFITS PROTECTION TRUST The UCAR International Inc. Benefits Protections Trust (the "Trust") is hereby amended as follows: 1. Article SECOND, paragraph (a) of the Trust is amended by adding a new subparagraph (6) to read as follows: "(6) such cash and other property acceptable to the Trustee as shall be paid or delivered to the Trustee from time to time as contributions with respect to the Company's obligations under the Enhanced Retirement Income Plan, together with the earnings, income, additions and appreciation thereon and thereto (all of which is hereinafter referred to as the "ERIP Account")." 2. Article SECOND, paragraph (c) of the Trust is amended by adding the words "the ERIP Account" after the words "the SRIP Account". 3. Article SECOND, paragraph (d)(1) of the Trust is amended in its entirety to read as follows: "(1) The assets of the Equalization Account may be used to discharge the obligations of the Equalization Plan and, to the extent the assets of the SRIP Account or the ERIP Account are insufficient, the obligations of the Supplemental Retirement Income Plan and the Enhanced Retirement Income Plan respectively." 4. Article SECOND, paragraph (d)(2) of the Trust is amended in its entirety to read as follows: "(2) The assets of the SRIP Account may be used to discharge the obligations of the Supplemental Retirement Income Plan and, to the extent the assets of the Equalization Account or the ERIP E-8 Account are insufficient, the obligations of the Equalization Plan and the Enhanced Retirement Income Plan respectively." 5. Article SECOND, paragraph (d) of the Trust is amended by adding a new subparagraph (2-a) to read as follows: "(2-a) The assets of the ERIP Account may be used to discharge the obligations of the Enhanced Retirement Income Plan and to the extent the assets of the SRIP Account and Equalization Account are insufficient, the obligations of the Equalization Plan and the Supplement Retirement Income Plan respectively." 6. Article FOURTEENTH, paragraph (d) of the Trust is amended by adding the words "the Enhanced Retirement Income Plan" following the words "the Supplemental Retirement Income Plan". 7. Schedule 1 of the Trust is amended by adding the following sentence at the end thereof: "5. The UCAR Carbon Company Inc. Enhanced Retirement Income Plan." 8. Schedule 2 of the Trust is amended by adding the following sentence at the end thereof: "5. The UCAR Carbon Company Inc. Enhanced Retirement Income Plan." - 2 - E-9 9. The amendment set forth herein shall be effective as of January 1, 1996. Dated: July 17, 1996 UCAR INTERNATIONAL INC. By: /s/ F. C. Wolf --------------- THE CHASE MANHATTAN BANK By: /s/ Paula R ------------ - 3 - E-10 EX-11 6 STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS EXHIBIT 11 UCAR INTERNATIONAL INC. COMPUTATION OF EARNINGS PER SHARE (Dollars in millions, except per share data)
THREE MONTHS ENDED SEPTEMBER 30, ____________________________________________________ 1996 1995 _______________________ _______________________ Fully Fully Primary Diluted Primary Diluted __________ __________ __________ __________ Income (loss) before extraordinary charge and cumulative effect of change in accounting principles................................... $ 34.8 $ 34.8 $ (2.8) $ (2.8) Pro forma effects of the Recapitalization (after tax): Compensation expense related to the Company's long term incentive compensation plan........................................ - - - - Senior subordinated credit facility expense............................... - - - - Net adjustment to interest................................................ - - - - Taxes due to Recapitalization............................................. - - - - Pro forma effects of the Initial Offering and Redemption (after tax): Accelerated vesting of performance stock options and matching shares...... - - 12.0 12.0 Net adjustment to interest................................................ - - 2.0 2.0 Extraordinary charge...................................................... - - 15.0 15.0 Pro forma effects of the Refinancing (after tax): Net adjustment to interest................................................ - - 2.0 2.0 __________ __________ __________ __________ Income before cumulative effect of change in accounting principles (Pro forma in 1995).............................................. $ 34.8 $ 34.8 $ 28.2 $ 28.2 Cumulative effect on prior years of change in accounting for inventories..... .1 .1 - - __________ __________ __________ __________ Net income - common stockholders (Pro forma in 1995)................ $ 34.9 $ 34.9 $ 28.2 $ 28.2 ========== ========== ========== ========== Weighted average number of common and common equivalent shares applicable to each earnings per share calculation (Pro forma in 1995): Weighted average number of shares outstanding............................. 46,323,935 46,323,935 45,959,718 45,959,718 Dilutive effect of stock options.......................................... 2,294,804 2,351,921 2,798,876 2,798,876 __________ __________ __________ __________ 48,618,739 48,675,856 48,758,594 48,758,594 ========== ========== ========== ========== Net income per common share (Pro forma in 1995) (A): Income before cumulative effect of change in accounting principles........ $ 0.72 $ 0.72 $ 0.58 $ 0.58 Cumulative effect on prior years of change in accounting for inventories.. - - - - __________ __________ __________ __________ Net income per share................................................ $ 0.72 $ 0.72 $ 0.58 $ 0.58 ========== ========== ========== ========== (A) Fully diluted earnings per share is not significantly different than primary net income per share and, therefore, has not been presented on the face of the Consolidated Statements of Operations. NINE MONTHS ENDED SEPTEMBER 30, ____________________________________________________ 1996 1995 _______________________ _______________________ Fully Fully Primary Diluted Primary Diluted __________ __________ __________ __________ Income (loss) before extraordinary charge and cumulative effect of change in accounting principles................................... $ 107.7 $ 107.7 $ (23.8) $ (23.8) Pro forma effects of the Recapitalization (after tax): Compensation expense related to the Company's long term incentive compensation plan........................................ - - 1.0 1.0 Senior subordinated credit facility expense............................... - - 4.0 4.0 Net adjustment to interest................................................ - - (3.0) (3.0) Taxes due to Recapitalization............................................. - - 37.0 37.0 Pro forma effects of the Initial Offering and Redemption (after tax): Accelerated vesting of performance stock options and matching shares...... - - 12.0 12.0 Net adjustment to interest................................................ - - 9.0 9.0 Extraordinary charge...................................................... - - 17.4 17.4 Pro forma effects of the Refinancing (after tax): Net adjustment to interest................................................ - - 6.0 6.0 __________ __________ __________ __________ Income before cumulative effect of change in accounting principles (Pro forma in 1995).............................................. $ 107.7 $ 107.7 $ 59.6 $ 59.6 Cumulative effect on prior years of change in accounting for inventories..... 7.1 7.1 - - __________ __________ __________ __________ Net income - common stockholders (Pro forma in 1995)................ $ 114.8 $ 114.8 $ 59.6 $ 59.6 ========== ========== ========== ========== Weighted average number of common and common equivalent shares applicable to each earnings per share calculation (Pro forma in 1995): Weighted average number of shares outstanding............................. 46,173,537 46,173,537 45,959,718 45,959,718 Dilutive effect of stock options.......................................... 2,231,759 2,271,278 2,732,828 2,732,828 __________ __________ __________ __________ 48,405,296 48,444,815 48,692,546 48,692,546 ========== ========== ========== ========== Net income per common share (Pro forma in 1995) (A): Income before cumulative effect of change in accounting principles........ $ 2.22 $ 2.22 $ 1.22 $ 1.22 Cumulative effect on prior years of change in accounting for inventories.. 0.15 0.15 - - __________ __________ __________ __________ Net income per share................................................ $ 2.37 $ 2.37 $ 1.22 $ 1.22 ========== ========== ========== ========== (A) Fully diluted earnings per share is not significantly different than primary net income per share and, therefore, has not been presented on the face of the Consolidated Statements of Operations.
E-11 EX-27 7 ARTICLE 5 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY CONSOLIDATED FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED FINANCIAL STATEMENTS OF UCAR INTERNATIONAL INC. INCLUDED IN ITS FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 1996 AND ITS FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 1995, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH CONSOLIDATED FINANCIAL STATEMENTS. 0000931148 UCAR INTERNATIONAL INC. 1,000,000 9-MOS 9-MOS DEC-31-1996 DEC-31-1995 JAN-01-1996 JAN-01-1995 SEP-30-1996 SEP-30-1995 91 102 0 0 188 174 12 10 171 139 475 445 1036 936 656 568 913 896 204 185 596 726 0 0 0 0 0 0 (40) (183) 913 896 711 657 711 657 436 411 436 411 6 35 1 2 47 75 155 53 52 60 108 (6) 0 0 0 18 7 0 115 (24) 2.37 1.22 2.37 1.22 Pro forma for 1995. See Note 7 of the Notes to Consolidated Financial Statements.
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