Square D Net Earnings

Selected Pages from Square D's 1990 Annual Report

CONSOLIDATED FINANCIAL STATEMENTS

CONSOLIDATED STATEMENTS OF NET EARNINGS

Year Ended December 31

(Amounts in thousands, except per share) 1990 1989 1988

Net Sales $ 1,653,319 $ 1,598,688 $ 1,497,772

Costs and Expenses:
Cost of products sold 1,088,977 1,027,348 979,591
Selling, administrative and general 385,903 369,726 338,962
Restructuring charge - 26,320 -
Operating Earnings 178,439 175,294 179,219
Non-Operating Income 34,740 17,106 17,255
Interest Expense (28,760) (31,438) (22,082)
Earnings from Continuing Operations before
Income Taxes 184,419 160,962 174,392
Provision for Income Taxes 67,773 59,856 63,310
Earnings from Continuing Operations 116,646 101,106 111,082
Discontinued Operations:
(Loss) earnings from operations, net of
income tax (benefit) expense: 1990--
$(1,188); 1989--$(1,086); 1988--$3,831 (312) 798 7,852
Gain on disposal, net of other provisions; net
of income taxes of $1,865 4,391 - -
Earnings from Discontinued Operations 4,079 798 7,852
Net Earnings 120,725 101,904 118,934
Preferred Dividend, Net of Income Taxes 6,176 3,300 -
Net Earnings Available for Common
Shareholders $ 114,549 $ 98,604 $ 118,934
Earnings per Common Share:
Primary:
Continuing operations $ 4.77 $ 3.95 $ 4.15
Discontinued operations 0.18 0.03 0.29
Net Earnings $ 4.94 $ 3.98 $ 4.44
Fully Diluted:
Continuing operations $ 4.40 $ 3.79 $ 4.11
Discontinued operations 0.16 0.03 0.29
Net Earnings $ 4.57 $ 3.82 $ 4.40
Weighted Average Number of Common Shares
Outstanding:
Primary 23,181 24,763 26,776
Fully diluted 25,088 25,809 27,016

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 Square D Balance

CONSOLIDATED BALANCE SHEETS

December 31,
(Dollars in thousands, except per share) 1990 1989

ASSETS
Current Assets:
Cash and short-term investments $ 244,933 $ 66,348
Receivables, less allowances (1990--$23,759; 1989--$18,556) 305,241 314,123
Inventories 159,109 151,316
Prepaid expenses 12,664 15,206
Prepaid income taxes 4,714 -
Deferred income tax benefit 34,988 26,459
Net assets of discontinued operation - 117,116
Total Current Assets 761,649 690,568
Investment in Leveraged Leases 137,182 133,344
Property, Plant and Equipment:
Land 24,477 22,216
Buildings and improvements 222,105 212,992
Equipment 552,785 501,531
Property, Plant and Equipment--at cost 799,367 736,739
Less accumulated depreciation 349,265 318,261
Property, Plant and Equipment--net 450,102 418,478
Net Assets of Discontinued Operations 36,681 52,949
Excess of Purchase Price Over Net Assets of Businesses Acquired,
Less Amortization (1990--$13,769; 1989--$12,978) 51,391 50,528
Other Assets 22,744 26,718
Total Assets $ 1,459,749 $ 1,372,585

LIABILITIES AND COMMON SHAREHOLDERS' EQUITY

Current Liabilities:
Short-term debt $ 123,871 $ 263,730
Current maturities of long-term debt 15,067 10,174
Accounts payable and accrued expenses 220,575 200,686
Income taxes - 10,327
Dividends payable 12,633 11,893
Total Current Liabilities 372,146 496,810
Long-Term Debt 244,820 123,420
Deferred Income Taxes 82,381 74,464
Deferred Income Taxes--Leveraged Leases 127,699 112,473
Other Liabilities 14,000 -
Minority Interest 10,941 9,295
Preferred Stock, No Par Value, Authorized 6,000,000 Shares; Issued
1,709,402 Shares, Outstanding 1,701,822 Shares, Cumulative
Series A ESOP Convertible Preferred Stock 124,568 125,000
Note Receivable from ESOP Trust (25,000) (125,000)
Unearned ESOP Compensation (95,400) -
Common Shareholders' Equity:
Common stock, par value $1.662/3, authorized 100,000,000 shares 49,601 49,409

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 Square D Balance

Additional paid-in capital 130,401 120,211

Retained earnings 773,126 713,225
Cumulative translation adjustments 3,262 (8,788)
Treasury stock--at cost (352,796) (317,934)
Total Common Shareholders' Equity 603,594 556,123
Total Liabilities and Common Shareholders' Equity $ 1,459,749 $ 1,372,585

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 Square D Cash Flows

CONSOLIDATED STATEMENTS OF CASH FLOWS

Year Ended December 31,

(Dollars in thousands) 1990 1989 1988

Cash and Short-Term Investments at January 1 $ 66,348 $ 65,855 $ 94,488

Cash and Short-Term Investments Were Provided from (Used for):
Operating Activities:
Earnings from Continuing Operations 116,646 101,106 111,082
Add (deduct) non-cash items included in earnings from
continuing operations:
Depreciation and amortization 59,300 49,443 45,174
Deferred income taxes 1,707 (25,147) (8,506)
Deferred income taxes--leveraged leases 15,226 23,445 25,683
(Gain) loss on sale of property, plant and equipment (1,011) 1,936 657
(Gain) loss on foreign exchange (2,222) 964 (52)
Minority interest 1,646 985 1,047
Other credits to earnings--net - (15) (63)
Current Items (net of effects of purchase of businesses):
Receivables 13,501 (58,515) (20,789)
Inventories (1,285) 26,568 (52,795)
Prepaid expenses 2,769 12,027 1,635
Accounts payable and accrued expenses (7,312) 16,736 20,316
Income taxes (15,253) (3,319) 8,243
Net cash provided from continuing operations 183,712 146,214 131,632
Net cash (used for) provided from discontinued
operations (484) 2,971 721
Net cash provided from operating activities 183,228 149,185 132,353
Investing Activities:
Increase in investment in leveraged leases (3,838) (2,876) (4,829)
Purchase of businesses, net of $103 of cash acquired - (9,271) -
Property additions (83,117) (80,024) (70,419)
Proceeds from sale of business 175,476 - -
Proceeds from sale of property, plant and equipment 21,774 6,186 14,222
Decrease (increase) in other investments 1,281 (12,794) 24,692
Net cash provided from (used for) investing activities 111,576 (98,779) (36,334)
Financing Activities:
Net (decrease) increase in short-term debt (143,983) 142,262 44,430
Increase in long-term debt 27,883 614 11,066
Reductions in long-term debt (14,412) (21,580) (17,910)
Proceeds of not receivable from ESOP trust 125,000 - -
Loan to ESOP trust (25,000) - -
Cash dividends paid on common stock (50,128) (50,590) (54,601)
Cash dividends paid on preferred stock (9,956) (5,000) -
Common stock issued 6,602 8,929 6,349
Purchase of treasury stock (34,916) (126,778) (111,394)
Redemption of preferred stock (432) - -
Treasury stock issued 54 114 256
Net cash used for financing activities (119,288) (52,029) (121,804)
Effect of Exchange Rate Changes on Cash 3,069 2,116 (2,848)
Net Increase (Decrease) in Cash and Short-Term Investments 178,585 493 (28,633)
Cash and Short-Term Investments at December 31 $ 244,933 $ 66,348 $ 65,855

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 Square D Cash Flows

See accompanying notes to consolidated financial statments.

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 Schneider Income

Schneider Financial Statements and Accounting Policies

STATEMENT OF INCOME

(in FF million for the year ended December 31) 1990 1989 1988

Net sales 49,884 45,127 40,493

Cost of goods sold, personnel and administrative
expenses (44,978) (41,008) (36,766)
Depreciation and amortization (1,565) (1,166) (1,272)
Operating expenses (46,543) (42,174) (38,038)
Operating income 3,341 2,953 2,455
Interest expense--net (832) (757) (182)
Income before non-recurring items, amortization
of goodwill, taxes and minority interest 2,509 2,196 2,273
Non-recurring items:
Gains on disposition of assets--net 419 550 484
Other non-recurring income and expense--net (367) (343) (642)
Income before taxes, employee profit-sharing,
amortization of goodwill and minority interests 2,561 2,403 2,115
Employee profit-sharing (158) (130) (126)
Income taxes (802) (912) (701)
Net income of fully consolidated companies
before amortization of goodwill 1,601 1,361 1,288
Amortization of goodwill (236) (235) (345)
Net income of fully consolidated companies 1,365 1,126 943
Group's share of income of companies accounted
for by the equity method 4 17 (53)
Minority interests (445) (266) (330)
Net income (Schneider SA share) 924 877 560
Net income (Schneider SA share) per share--in FF 62.96 63.06 48.85
Net income (Schneider SA share) per share after
dilution--in FF 61.65 60.53 N/A

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 Schneider Balance

BALANCE SHEET

(in FF million for the year ended December 31) 1990 1989

ASSETS
Current Assets
Cash and equivalents 1,841.3 3,400.3
Marketable securities 3,020.9 1,924.3
Accounts receivable--trade 14,597.4 14,987.3
Other receivables and prepaid expenses 4,738.1 3,876.5
Deferred taxes 407.5 290.2
Inventories and work in process 7,712.6 7,159.0
Total current assets 32,317.8 31,637.6
Non-Current Assets
Property, plant and equipment 14,293.9 13,107.5
Accumulated depreciation (6,691.5) (6,365.6)
Property, plant and equipment--net 7,602.4 6,741.9
Investments accounted for by the equity method 175.9 135.7
Other equity investments 1,727.9 571.3
Other investments 573.0 618.3
Total investments 2,476.8 1,325.3
Intangible assets--net 147.5 153.5
Goodwill--net 7,032.8 6,087.8
Total non-current assets 17,259.5 14,308.5
Total assets 49,577.3 45,946.1
LIABILITIES AND COMMON SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable--trade 9,867.9 9,614.6
Taxes and benefits payable 4,822.5 4,795.8
Other payables and accrued liabilities 5,230.4 4,332.2
Short-term debt 3,120.5 3,165.8
Customer prepayments 2,509.5 3,848.3
Total current liabilities 25,550.8 25,756.7
Long-term debt 9,958.4 7,345.9
of which: convertible bonds 3,950.2 1,108.8
Provisions for contingencies 3,942.6 3,890.0
Invested Capital 24,030.1 20,189.4
Capital stock 1,414.4 1,397.2
Retained earnings 6,091.1 5,344.6
Shareholders' Equity 7,505.5 6,741.8
Minority interests 2,623.6 2,211.7
Total shareholders' equity and minority interests 10,129.1 8,953.5
Total liabilities and shareholders' equity 49,580.9 45,946.1

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 Schneider Balance

1988

1,579.6
1,243.7
13,998.5
4,054.9
236.9
29,715.3
50,828.9

12,019.7
(6,409.5)
5,610.2
244.9
684.6
909.8
1,839.3
115.0
5,596.8
13,161.3
63,990.2

8,440.8
3,748.4
3,405.5
3,081.3
27,606.1
46,282.1
7,712.1
500.5
3,758.8
17,708.1
1,146.3
3,046.6
4,192.9
2,044.3
6,237.2
63,990.2

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 Schneider Cash Flows

STATEMENTS OF CASH FLOWS

(in FF million for the year ended December 31) 1990 1989

I. Operating activities
Net income of fully consolidated companies 1,368.5 1,143.7
Depreciation, amortization and provisions, net of recoveries 2,164.0 2,283.0
(Gains) on disposals of assets (418.7) (550.1)
Others (0.8) (28.7)
Net cash provided by operating activities before changes in
operating assets and liabilities 3,113.0 2,847.9
Decrease (increase) in accounts receivable (944.4) 1,170.4
Inventories and work in process 675.4 (1,708.6)
Increase (decrease) in accounts payable 578.7 (16.3)
Other current assets and liabilities (1,681.4) 736.0
Net change in operating assets and liabilities (1,371.7) 181.5
Net cash provided by operating activities 1,741.3 3,029.4
II. Investing activities
Disposals of fixed assets 712.9 1,394.8
Purchases of property, plant and equipment and intangible assets (2,589.5) (2,154.3)
Financial investments (2,788.2) (1,068.8)
Other long-term investments 125.5 13.4
Net cash used in investing activities (4,539.3) (1,814.9)
III. Financing activities
Reduction in long-term debt (1,626.4) (3,045.2)
New borrowings 1,508.7 2,435.1
Convertible bonds issued 2,655.6 634.7
Common stock issued 71.9 1,877.0
Dividends paid:
Schneider SA shareholders (174.6) (126.1)
Minority interests (116.5) (69.7)
Net cash provided by financing activities 2,318.7 1,705.8
IV. Net effect of exchange rate and other changes 13.8 178.5
Net increase (decrease) in cash and cash equivalents
(I + II + III + IV) (465.5) 3,098.8
Cash and cash equivalents at beginning of year 3,424.9 326.1
at end of year 2,959.4 3,424.9

The following notes are an integral part of these financial statements.

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