Document gb7v7721LvwNrke8mMb9b8Zre

Reports of Management and Independent Accountants Report of Management The consolidated financed rtrtanma of Dresser Industrie, Inc. hare been prepared by management and haw k<en examined by fndependert acoountaifc. The management of the Company is naponsibie for the financial information and reprerentations contained in the financial statements and other section; of the nasal rrpurt Management bekeres that the financial statements haw been prepared in conformity with generally accepted accounting principles appropriate under the dtcnreoances to reflect, in all mJcrial rcspxb :k substance of events ant transactions that shouxi be included In preparing tlie financial statements, it is necessary that management make informed estimates and yudgmerfe based 01: curratly avai able information of the effects of certain evens and transactions. Ir. mating its responsibility for die reliability of the f.nanctal statements, management depends on the Gonpatr. $ system of interval accounting control. This system is designed to provide reasonable assurance that asses are safeguarded and tnnadhais are executed in accordance with management's audior/atum and properly recorded. In designing cm trot procedures, management recopifces that errors or irregtihntie mav nevertheless occur. Also, estimates and judpents are required la asses and balance the relative cost ar.d expected lienefls of dw controls. Management behests that the Company's accounting controls provide reasmnhte assurance dial cmas or irregularities that could be material to the financial statements are prevented or wduIl be delected within a timely period by empfavea in the normal course of performing their assigned functions The Board of Directors pursues its orersight role for the accompanying financial statements through ib Audit ana Finance Committee, which is composed solely of directors who are not officers or employees d the Gonpany. Tire Committee meets with management and the internal sndhora to review the work cf each and to monitor the discharge bv each of its responsibilities. The Committee also meets with the independed accountants. without management present, to discus internal control structure, auditing anc financial retorting nHtn. Report of independent Accountants Price Waterhouxe ^ lb the Slareholders and Board of Directors of Dresser Industries, Inc. In our opinion, the acccntpanying consolidated balance sheets and the related consoiithacd staksnenfc of earnings, of shareholders' invernnait and of cash flow present fairly, in all material respects, the financial position of Dnsser Industries. Inc. and its subsidiaries at October 31, *988,1967, and 1966, and the resulted of their operations and their cash Dove far fire years then ended in coafonnit) with generally accepted aocojnting principles. There fmnual statements are the raporcfoihty of fire Company's management; our responsibility is to expns an opinion on these financial statemenb based on our audits. We conduced our audits of tie* aatemerti ia accordance with generally accepter! auditing standards which require that we pbn and perform the aLdk to obtain reasonable assurance about whether the financed statements are free of material rarutaremeML Aa axk indudes rmfriiag, on a test basis, evidence supporting the smarts ar.d dfadosures in die financial stmemente, assessing die accounting prindples used and significant estimates trade by management, and emiuaing the overall finandai statement presentation. % believe that our sudfits provide i reasonable basis tor the opinion expressed above Price Waterhouse Dallas. Tkxas December 19.1966 26 Consolidated Statements of Earnings In WUm efOaBm Kxaft ftr Skate Dolt -- Ifcw fltafe/OcftAerJ/. Sales revenues .............................................................................. ServicE renames -- Note C and n ............................................. ... Ttoai ales and service revenues...................................................... Cost id safes ......................................... ...................... Cost id services............................................................................... Tola, caste of safes and stmars - Nates 0.1'andN.......................... . linw. earnings ....................................................................... Selling, engioourins. administrative andgneraJ openses -- Note M......... Special charges -- Note X.............................................................. Earnings floss) (mm cperaiiius........... ......................................... Otlie* income (deductions) Interest expense.............................. ..................................... Interest earned......................................................................... Realties earned ..................................................................... rtnuon plan setllemaits -- Note M ............................................. Partncship opertions -- Note B................................................. Ollier, net -- Note N ............................................................... Ibtal Ollier nxomc ................................................................ turnings from continuing operations before income taxes, minority interest and equity earnings ............................................................ Income taxes - Note 6............................................................... Minority interest in learnings) kisses of subsidiaries -- Note C............... Equity in earnings of unconsolidased sul&idiarks and affiliate -- Nate B .. Earnings (loss) from continuing operations..................................... Dfecontmtied operations Mule B ............ ................................... Kamings before extnordimry Item ............................................... Extraordinary item -- Ux benefits from k carryforwards - Notes B ant G Net earnings........................................................ ......... ......... Eaminis per commor stare - Nate N Earuings (loss; Iron continuing operations...................................... Discontinued operations........................ ..................................... Earnings before extrmdinary ten ........................................... Extraordinary tax benefits .......................................................... Net can,mgs ....................................................................... Dresser todnstries Inc. and wbsk&mcs 1988 $3,2267 7150 3,9*17 2,2530 6510 2,9040 1,037.7 886.4 151.3 1987 ft.0.30.9 88.8 3.19.7 2.1544 884 2,242 8 8769 852.6 24.3 1986 $3.4318 229.5 J#!.) 2.4839 230.5 2.714.4 9169 970.4 25.3 (48.8) (46:6) 41.5 19.4 136 1.0 (1.6) 273 (97 0 35.6 9.7 889 <36.8) 14.7 15.0 (75 0 370 125 61.7 353 71.6 178.6 (64.1) (6.3) 14.6 1228 227 145.5 11.3 $ 156.8 393 (48.0) 15.2 9.8 16.3 26.7 43.0 ___ 59 $ 48.9 228 (525) (3.2) 7JJ (25.1) __ 25.6 .5 91 $ 96 $ 178 :33 2.1 J __ J6 $227 S .22 .35 .57 $ .65 $ (32) ___ 33 01 11 i ii See Accompatnvit Notes to Oms'JtdahdFinanatd SlateamUs 27 Consolidated Balance Sheets Dresser Industries, inc. andSutotoharies Assets to mint oflloOttn -- October 31 Current Asets Cash...................... ................................................................... ___ Shnn-term inwstnictKs - at ost (approximates martet) .................................. ....... Notes and accounts recantIc public -- Note D .......................................... ....... Vies and aocojnts ruccivafck from uncotsol.dated subadaries and affiliates.. ___ . . .. l*s illtwana (or doiirtful ivccivaMes .......................................................... Iirrwitories -- Note k linished prcdoctf. and wink in process ...................................................... ........ Mar materials and supplies ................................................................... ....... inrearoet in discunlinued opentiare - Vic B........................ .................... Refundable and deferred income taxes -- Note G............................................. ........ I'npaid expenses .................................................................................... Total Current Assets.............................................................................. ....... 1988 i 87 0 100.0 661.1 254.2 37.0 878.3 385.5 82.4 467.9 -- 9^2 14.9 1,647.2 Investments and Other Assets Investments in unconsolidated subskSarie and affiliates -- Notcfi.................... Infcugftdes -- Notes C and P................................................................... ....... long-term receivables and imwanesns........................................................ ....... Other assets and deferred income taxes -- Note G and M.................................. ........ 'fatal Investments and Other Asrets.......................................................... 504.8 2514 12.3 26.2 794.7 Property Plant and Keiupnent -- at cut Land land improvements and mineral deposits ............................................. ....... Buddings .................................................................................. ........... ....... Machinery and eqiapmait......................................................................... ....... less accumulated depreciatnit. (fepfction and amwtiaMnn -- Note N ................. ....... Ihtal Properties -- Net....................................................................... 68.0 279.7 992 2 1.339.9 882 4 457.5 S24W.4 1967 t 819 211.5 721.6 100.7 46.3 776.0 483.7 1293 6130 173.3 103.2 12.7 1,971.6 396 8 5 72 32.6 4371 64 J04.0 1.000.5 13659 892 3 473 6 $2,K23 1986 S 45 3 29.0 756.6 63.8 71.5 7189 5131 1530 6661 598 173 1.8284 517.5 94 75 590 593.4 698 3538 1,281.1 1.704.7 1,0163 J88.4 13.1102 Set Accompanying M*sr to Consolidated Fmanaut Statements. 28 DmurhvkutriB, he MtdSubm&miti liabilities and Shareholders' fewestment h MOUrnt cfDoOats--October 31 Current Liabilities Short-term drtt -- Note H........... .................................................... ................. Accounts papfek -- public .............................................................. ................. Accounts payable to ummsolidatd stfeadbries and afdlises..................... ................. Accrud compensation and benefit--NottM....................................... ................. Acaud warranty costs ..................................... .............................. ................. Acaud tarns other than income totes................................................. ................. Atones from eustomen on contracts -- Note D.................................... ................. Acaud inters) ............................................................................. ................. Other nocmd HabObfe.................................................................... ................. Income tastes -- HoteG .................................................................. ................. Cunestportianofbag-ttmidebt -- Motel ......................................... ................. Ibtal Current LiahiUtte................................................................ ................. Lom-Tferm Debt-- Note 1.........................'*....................................... ................. Pension Plans -- Note M .................................................................... ................. Defend Compensation and Other Lobdiies -- Nolsf andj........................ ................. Minority Interest -- Nab C .................................................................. ................. ShnchoUes' Inemm--Note I, J, KandN Common dans, $0.25 par eahie Authorized shun 200600,000 Isucd shares: 85,124,224 in >968. 82,955,149 to 1987 and &*,<& in 19*6 Capital In excss of par value ................................................................. Cumulate traubtioc adjustments .......................................................... Retatad earning................................................................................ Less treasury shares, a cm ................................................................... Hail Shoebolden' Imwtment ............................................................ 1988 < 26.9 281.9 526 165.1 40.2 25.3 142.8 25J 1673 696 W.6 927.5 255.2 65-3 691 77.7 20.7 4383 (24.4) 1,475.4 IJIOjO 405.3 1,504.7 Cocnmiments and Coctiiigencia -- Note L and M (19994 1987 $ 61.3 2441 210 1464 44.7 380 155 502 1581 550 ___MJ 8583 271.1 782 69.6 71.1 20.7 4363 (43) 1356.7 11093 2593 1,550 0 $2,8823 1986 $ 1711 2263 49 151.6 56.1 419 283 15? 1905 312 236 9411 3587 113-1 63.6 201 20.7 4326 (341) 1338.1 1,756.6 1430 16136 <3,1102 Sk Accompanying jVqIb At Cmnhhhd Fmmdaf Skhmaris. Consolidated Statements of Shareholders' Investment Dresser industries, hsc and Subsidiaries / Mdbotn cfDotan -- tfcrj Ended Odeimr$1, Coamon Shares, Bar tote-- Notes J lad 1 Beginning of year............................................................................................ Shares iauad in connection with srployee benefit tnd cMderi retnvestnienl pfaus ........... End of year............... ........................................................................... Capital ia Excess of Far tohie Beginning of year ...................................................... ..................................... Share issued in connection with anpioya benefit and dMdend reinvestment plans ........... FjuI of year.................................. ............... ....................................... 19H8 $ 28.7 -- $ 20.7 S 436.2 2.1 J.J38.3 Cunuhiive Hranslation Adjustments Beginning of year............................................................................................. Ad]tLstments due in Itaosbakm rate change during the rear......................................... End at year......................................... ............................................................ Retained Earnings -- Note l Beginning of vear ............................................................................................ Net earnings ................................................................................................... Dividends on common shares at 155 a share in 1988 $.40 a share in 1987 and $.78 a share in 1986 ..................................................................................................... End of year............. ........................................................................................ $ (4.3) (20.1) (_W 11356.7 1568 (38.1) $1,475.4 Itaoury Shares, at Cost -- Notts J and! Beginning of year.............................................................................................. Shares acquired ............................................................................................... Shares tsaied in connection vldi employee benefit and dMdend rtomtsonenl plans ........... End of year..................................................................................................... Tbai Shareholders' Investment, End of tear.......................................................... $ (259 3) (153.3) 7.3 * (405.3) J1JP4.7 1987 $ 20.7 -- $ 20.7 $ 432.6 36 $ 436.2 i (348) .385 $ (4.3) *13381 48.9 (39 3) $13*7 $ (143.0) (123.3) 7.0 $ (259-3) $1,550.0 1986 $ 28.6 .1 $.20.7 $ 422.6 10.0 $ 432.6 $ (57.8) 23.0 $ (34.8) $13828 9i (54.3) $1338.1 t (122.0) (21-0) -- $ (143.0) $1613.6 See fcompe*ying Nates to OaMpikktedPmemaai SUtrmrnt 30 Consolidated Statements of Cash Flows Dresser Industries, Inc tmdSubsidiaries hemUmucfndm -*mEndedOt**sr$l Cadi flows from operating activities: Net anting*............................................................................................... Aljustmtns to reomcik net K-min^ id net ash provided by operating activities: Depreciation, depletion a.id aaortkatkm .......................................................... Special charges .......................................................................................... Gain on business disposals............................................................................. I'tpiiiv in earning of uncuu*Mated subsidiaries and aRiliaies............................... Uquitv In partmrtitip (eaminps) losses............................................................ Minority interest in ions (namings) ................................................................ Settlement of Hughes litigation....... ............................................................... Decrease (increase) in receirAle .................................................................... Decrease (increase) in inventories ................................................................... Decrease (iiuruso) in refundable and ckfcrred income taxes and prepaid openses....... increase (decrw.w) in aoen nas pavahle and accrued liahibties.............................. (Decrease) in advances from customers on contracts........................................... Increase (decrease) in income taxes payable .................................................... Increase (decrease) in pensiou liability............................................................ Otlw -- net .......................................................................................... Tbtal adjustments.................................................................................. Net cash provided bv (need In) operatiig activities ......................................... Cash flews from investing activities: Business aaquiawns .. ................................................................................ Cast) and cash equivalents of aocufred company.................................................... (ash and cash equivalents toansferred to taint venture companies .............................. Capital otpcndjtjr .................................................... ................................. Caslt received from (paid to) unconsolidated sufetdfcariei and affinaes...................... Proceeds from sales of assets............................................................................. Business disposals ........................................................................................ Net cash provided bv (used in) investing activities............................................. Cash flews from financing activities Increase in (reduction of) tong-term debt.......................................................... Increase in (reduction of) short-tom debt and current portion of long-term debt......... IVoocods from sale cf common shares................................................................ Dividends paid............................................................................................ Purchases of common share (or treasury............................................................ Net cash (used in) financing actMUes............................................................ Effect of imsdalion adjustments on cadi ................................................................ Net increase (decrease) in cruh and cash equivalents ................................................ Cash id cash equivalents, beginning of war.......................................................... Gufa and cash equivalents end of year................................................................... 1988 t 156.8 96.9 -- (42.9) (16) 6.3 (23.0) (47.1) (53.7) 1A 286 (519) (196) (206) (23.7) (164.5) (7.7) (114.1) 75.9 (53) (62.5) (386) 4.7 2714 134.5 (146) (386) 2.1 (38.1) (1466) (2346) 1.7 (105.5) 2934 $ 187.9 1967 * 48.9 120.4 '--<5i) m 36A 052) -- (732) (173) (40.1) 633 (I2A) 28.7 (42.9) 6.1 . *3 __872 -- -- (23.3) (57.4) 2100 476 37A 214.7 (857) (1246) 36 (303) (1163) (3533) 8.5 (42.9) 336.3 * 293.4 1986 * 96 162.0 25.3 -- (78) -- 32 -- 1957 66.9 464 (1097) (16.7) 116 556 (26.7) 405.4 4154 (306) -- -- (71.1) (107.1) 412 -- (167.6) (44.5) 27.7 10.) (54.3) (21.0) (024) 67 172.1 1642 * 336.3 Supplemental information concerning non-cash investing and financing activities is Jndnded In Nats B and C. (name taxes paid and lure* paid are (factored in Notes G and i, respectively SeeAcam^xtoyinf Notes t> OmtMued ftmauxl Statements. 31 Notes to Consolidated Financial Statements Note A--Summary of Sgraficant Acooutuig Policies (iHwUatkm Ail m^orit:-owned domestic afakbrin an consohdsted except for wholly-owned financial service, iisunoce, real estate and eppment disarfbuOor compreiies. AH majority-owned foreign atndiaries jk consolidated Ail materia! intercompany aocounte and transactions are etoniiuted. tovesanaits in ancon*4(dated subsidiaries and In 20-SOX owned partnerships and affiliates an reported ai cast adjusted tor the Company's equity m undtslrfoutod earnings or losses. Earnings which are subject to materia) tin todal or prlitlcal risks are nut recognized until remitted Reakuhtfs jtypropri.it: allowances in provided fi:r all doubtful receivables. and an allowance is provided for aH recenahb delinquent :ur more that; ISO days uric* an account does not represent a collection risk. Umg-'krm Contracts Revenues and earning; from kug-hnti engineering and construction contracts am reoogpized an Am penentage-of-coropletion method, measured genetalK on a coat incurred basts, fetmtated contract costs include al owances for completion risks, process and schedule guarantees and warrantees than generally are not finally determinable until the taller Pages of a contract. Estimated contract eaminp are reviewed and revised priodkally as die work progresses, and the curudattve effect f any change to recognizee in the pcriwl determined, baanatd fossa are charged against earnings in the period such fosses are estimated. Amounts tiled in excess of revenues recopifeed to date are induded in current liatitJes under advances from customers on contrail. Inradohes Inventories are valued at die ktner of col or market 'IV cot of most U.S. inventories Is determined using the last-in, first-out (UFO) method. Inventories not on UR), principaUy taiwenteorlcs not induded in the Company's US federal inenmr tax return, are determined ukng swage cost. Obsolete items or excess quantities which ate deteimioet ta be uusalidvle are valued at their net (callable value. ftrftrtr. tHeut and Equipment I'ued assets ire depredated over die estimated service life. Accelerated depreciation methods are used for financial statement purposes, except for U.S. fixed assets with a sendee life of ten yean or less, which are depredated on a stnuglt-line bash. Accelerated deprecation mehods are also used for tax purposes wherever permtaed. All significant fixed assets are reviewed periodically and, f detambmi to be ocess, obsolete, nr unsuitable for fotix upended use, are reduced to value* recognizing their unpaired utility or art assigned shorter ramming useful lives for dcpruaatioa putpoces. Due lo the large number ef asset dasses. it is not practicable to stole the rates used in computing the ptwMons for depredation. Depktkxt of mineral properties is based upon cteimatB of economically reenterable tonnage. Maintenance and repairs ire expensed as meund. Betterments are capitated. tntmgUrks The (Ufformce between purchase price aid frir values at (fate of acquisition of net aretes of business required after October 31. 1570 is amorttoed on a staight-iine basis over the estmatod period benefited: not exceudmg 40 years. The costs of preens acquired in connection wth bustrjere rofikdtions are amortized on a straight line tresiiuver the remaining economic life of the vespediro patents, butln no event longer than the remaining legal fire Hbmmtr Costs Estimated produd performance creb are provided at the time of sale of the warranted product fawms Beginning in 1586, coss of U S. pensfon plans, and gains and Ion on retthmenk of Millttes under U.S. pensiotL plats are detmnined in rexodance with Stalemen&d Accounting Stoncatcb No. 87 and No. 88. beginning In 1967. Streemens cf Fin&nda) Accounting Starehrds No. 87 and No. 88 were adopted for Canadian pension plans. Pmteon cost for ather foreigti plans for the yean ended October 31.198ft, 1587 and 1986 and for Cinadtan pirns for the yer ended October 31,1566 were determined under prior accounting principles. 32 Note A -- Summary of Significant Accounting Policies (confined) In Defend inoome axes are ponded far tilling differences behraen income andevenaraieportedtir financial statement purposes and tax pupae, snd far income tuts payable upon the mrirtpafccl terfludon rf tie earnings of famp sdK&aries. Inraanent lu credit ate reflected is reductions of femme tax eqpnse in die pars in afaich uch credits vise or in Ihe yean i*jr can be utlliad. Awufefei tfAregn Qtrrmde hr subsidiaries in countries uWch do not hse hiihr infbtioaary ecraomtok aaet and Mltty accounts are trembled the Mr li rffea at (he balance Aeet dale, and mane ml apmre amounts are undated at wiglaed area# fees. ttamfeiot adjurentnis at reflected if a repaore caopcnett lURnoWF nvBuBan. far afeidtoks in countries vlh ttjWy infettmtry economies, tamnories, cat cf sds, property plant ud equipment and retried depreciation or undated at hhtorical met Other tad and Udbillty accounts ire translated ri rates la dkl at the balance Are! felt; ad tereoues and atftnm reducing cart of ale ind depredation we Undried ri wfetad area# ms. Ihndrihn edjmtmenfc are relead in the striement of earnings. Prior few Pmrnckd SUmtiUs mdNmiAcam&igStmtitnli A Mat of cadi laws is todaded fe 1988 as required by Sttfanml of Rnandal touring Standards No. 95. Campuatlre cuh In Basements far 1967 d 1986 are tire iaduded. R* purport tf reporting cuh flows, cub and cadi equivalents iadude cash on hud and hradmeutt wtth maturities of three months or Its. HUB rKMOBDCBIOni MW Wb IppBflu ID ptMT ytm TOCIII MBMIB COMDHD U) B IgOB ptaeuutlan. Tfe Bnancfe tounfcig Srindredt board hot jaaoed caffa acBBuniiin laiAidi aflbcMuii Ifee ooonbbtion of majority-owned subsidiaries and amounting far brant (us and penrion phis. Thr Ganpony fc net nqaiind la ad be ool yet idly adopted toe andnfc. s dbcuoed In lie appnpri* Mowing rales. Note B -- iDConsolidattd Sferafiarfes and AfflUfeos Dnontmsed OptHtkm On Nowmbd 6,1987, the Corepmy sold IS wfoDy-nroed unconsoittfeed nfefery, Reliance Stanford Ufa Ineurmoe Company, to RSL Halting Company Inc., a whofly-owned sdridary of Roteokutt k Company, fir an aggregate cadi coarideccta of t22D mdicn. 11k fee routed in a ml aftertax pta rf #4.a Billion or per dratadudkgtti ailfc or f ib per share of tnbeulb of lore carryfanreah. The tu bend* lie totaled bi the amriinary Men and a tai# equtaleoi to turn a included in "DfeoMiniid cpecflloss** on tie 19# Meant of comb# Ob Octofer 30,1987, fee Canpaa^atfe^ainduiiraiiKfefed finance nfeMfe% Dtbki ftamie Corporation, sold ill karfog afeliMii Dibbt Lauiag Cnparadan, la Sanan lautag Coopomfeo, a aWy-owai afeidiary of Sonan Financial Cotpaotion. it a coh eoatfendn of U7 S nOUsn bd) nultod in a {Hn of $$.6 mlltoa As part tf the aanaetton, Sown Leadf Goipanttai repaid (773 idliiao of oumandtag intetampiy loam fen Droer Leasing CopooBioo fe Dkkt Finance Copomioa The oponiotB of and gatm on oka of Mince Standard Lit Ioauranz Coopaqf and Draw laaiot Cotporsiou are apantd as dkeondnued ip<rations hi die comoikiMtd stafereentiof eranlnp. fUjnwnfahfef fefmidhrfe awrfjjjlhahr Eftdfe Sepierafer 1,1988, fee Conw and Komafeu Lid. ora^taed Mr esrutraettan aqa^nat budme hi die flWern Heahphere into a nor oonpaiqf named die Kanrahu Drearer Caopiuqi baasta Drearer Conpaqr ft i pranl pamenhip and is omed 50 penat eaefa bp the Oonpaqr and btiKBu. Tbr Company contributed appraxfcnaieh SI91.1 miloo d net araeti jaduirn apprathnae^ ft543inllionofinic^apttaltaeuhan(efefecaraerdilpMerea.TfefeaareUBtaeaianl reatabte rf Dresser Ftaance CorpvaUon and die captal dtares of a ahofly-oamd umnaeWated oqulpnieta ebsarbudoo sutektary were hiduded hi dae assras oootrfiMed. Notes to Consolidated Financial Statements (continued) Sole B -- Ifoconsolidafcd Stfoadhries tod Affiliates (oooinued) QmHmiiag lutaktiom tndfffikaks fconHmud) Effedwe January 1 1987, the Company and tapersoll-Rind Cctnpmy ccmbioed Aeir canpram anti turbine businesses and fanned the Dimer-Rand Gcrapany. Desrer-8and Is a general partnership and is <wned 50 percent each by the Company and Ingenofi-Rind. The Company ooatribuled apprnriiMBily <170 mifiion of net assets induflng appretamtHy <62 mfllaaa f-aaorltbis aapfeal In entange for IB omenhip interest. M af 1% 1, 1987, Ae Company and Linen Industrie, Inc combined fee Company's Mks DMtiooand Lttoo t Resources Group tato a near International ailfldd aerrtce ccmpuy named ^tien Adas Inter national. Inc. Idem Allas International, Inc is owned 30 percent hr be Company and 70 pacer* by lan Industries, Inc The Company contributed appmdmiafy <176 miltot <d net aaen loduding qprmtmrerly <53 million of working gyittl in qcbaqge fcr to omenbjp tntaat Hie Gotnpanfs equity bus inratmenB In Dresser-Rand, Kotnanu Draaer and Ifcaem tths an Included to "Inremnents in untnwcllrfated smadancs aad affiliate". The foify1! date of the earnings or loss of Ae Drester-Rand and domain Draaer ptnnenhfra are tadudad In "Pafloenbip operations" The Gaapanft dare of tie eaaninp of Mem Mat la todudad Id "Bouty In earnings of unconsolidated subtiiaries and affineT. The Compny will begta mnmfcheing ft Rnaining whpBy-ouned umnoUdaied nibridhria in 1969 at required by Statement of financial tawnting Samdhrds Sol 94. Since the Inreamuft ne currently aooornttd fcr on the equiy basis, Ac change wUl not hn* a n^dScrect effect an Ae Company's financial poattion or nuk of (potions. The Company received cadi dtafendi &om Ae imnaoUbaed uhsidbrto and 20% lo 50% owed a&hreet of <122 mfflno hi 1988, <131 mfiUon A1987 and <3.4 mlUton A1984. Inrettnafc in unconsolidtied subsidiaries and afthara Include tong-term adanoa cf <6.5, <2.8, and <172.2 mfiiian at October 31,1988,987 and 198b, rapedt*ei|t Summarimd balance she*. menraand net esnings infaraation hr the JO* to 50% ouned partnerships and affiliates aid the wbaDy-oumed wyaprotl Asribulon Is ar Mbm (in ariAon*): Draw-Rand and Amatol Dreaer 1988 1987 Recetabtes................................................... .................. KXMOtOriB . .................................................. ................... Property net . .............................................. ................... OAsasefe................................................... .................. Ttaal assets ................................................ .................. I 510.5 8478 240.4 _3 $1,744.0 <1172 2(0.1 101.5 1228 <401.6 Notes p^dde to banks ..................................... .................. Accounts payable ............................................ .................. OAertabAta ............................................ .................. Owners' equity.............................................. .................. IbtaJ bbflfes and omkb' equhv.................... .................. < 445.2 341.5 3920 587.3 <1.744.0 <107.0 518 194.0 2(78 <6116 Imetuitiil Eg*? in net ram....................................... .................. Leans and adorns .................................... < 245.3 < 245,3 <990 <990 Rennies ..................................................... .................. <897.9 <5494 QM& and expenses.......................................... .................. $ 896.0 Equfty in net earnings Ocas} .. ........................ .................. < IjO 1 m <(368) 1988 < 301.0 191.9 410.7 302.9 <1206.5 < 116.4 127.0 254.7 708.4 <1206.5 H Other 1987 < 3241 245.5 541.9 307.9 <1.4394 < (B.9 2417 3084 8002 <1.439-4 < 239.9 6.5 f 244.4 <1277.7 <12248 < 9.7 < 254.6 28 <J574 < 7IB8 < 794-5 < 1.7 1986 <199.3 21a i 317.4 768 <807.7 171.3 111 1 2300 395.3 <W72 <105.2 11.3 ft 165 <7133 <7677 yu> u Note B -- UnconoUdtfNl Subsidiaries tod AffiBaces (ooattaaed) The Company's rwstmert in Dresser-Rand and Komatsu Oreser is redond by ana valuation teams amt nqpite goodril, which existed before the otabtohmcnt of die partnenhipt. Tht nkmton nsaws are ban* released to earnings as the leftated asms are sold by Ik paitnersfcipt Tie negate goodwill is being amorttoed am ten years. Sommartod balance sheet, menses and net eanwgy atfimnatioD for die tritoNy-omed unonnliifaiad financial lendoe, insurance and ml estate substitute and 150% owned real etefc panned# is as fcUdK (in miltiore): i CM-ac-dOi--Eaf1tnS>d-I_SfoBo..r.t-.t.e..n..n..i.n.v..e.s.t.m..e..n.t.s....... ! Pnptttjnet........................... Other aseti............................. ' Ibcal aaseis.......................... [ Nicy reserves......................... ! Notes payable to hanks .............. *j **--l----a-W----tf.................* * , Other Uriltte ........................ Omen' equity......................... Had fahHUes and omen' eqirity 19tt $514 112 2H 1.7 m $m -- 55.5 104 m Crrtinalafc 157 $1144 W2 211 4 WAS $- 61.6 307 1174 306 $2403 1906 ) 64.6 177.4 312 64 $207.0 $45.1 3M 127.6 740 $287.0 Equity to net asrts Loans and adonotsI $m -- m I ftemues....... ..................................................................... $511 ; Com aid eqmses.................................................................. $259 Equity in net earnings............................................................... y? 1 *ReUnceStandred Life imuore Company and Dnmr luring GuptMta. $40.4 -- $40.4 $69.4 m $ ii 1543 !54l $2114 m <60.0 < 7.9 Nole C -- Bustoes Combinations On January H, 1988, the Company mquted adatmliafif all of the ham ofUrn hL * KtOogg Onopany, a pmceu engineering and OMriracftn laa, tea Ike Hatey Gnnps Inc. far a cub oriky rf <114.1 inditon and die asuapdoi of non-intent baring ftdbOOa cf $545-5 attm. The aogiritahubemaeeoiiriedfeuapu(duseand,acoo(dtagfctecumitited*timectrf analogy incktits die mob of operettas state da dm of aoqritfta. Tk aoqoMta o eaceeded the sir nlue of the net amen acquired by agprerinriy $2940 mtton. Ik am ms noted as gpothrill and is being amrifaad on a *ag*-ttoe bads otar forty years (Note ft The fofloaing trite presents unmdtodpw forma earnings satana fotemritafortheymreenteit October 51,1988 and 1987 asififaeacqaMlmMoaandmNoMtel^Btt.ilnaiMi^te been matte hr the ttanuaed inoreaiB io chpredatioo and aaortiation 4 the uteri amts. Tla pro t--------- w --1--'j- ^ttnr-jm ~ndf har nimrnd had dr argdrtta Inrn in Norember J, 1986 or the rentes that nay occur in the tarn. DtsconttamT 1987 1906 $632.7 174 1.4 859 $7374 $5656 I8L2 112 ' 139.7 m $4734 -- -- 87.4 L76j0 $7374 $4447 214 1.3 249-5 177.4 $904-7 $1713 -- <1713 $2447 $2274 $ 247 $1810 4.8 $1084 m $205.0 $254 Notes to Consolidated Financial Statements (continued) NoteC-- Business Canbifutkms (continued) I AijuAmb; BEftfpirjtanPMomtr Saks and service rewnues ............................... ; tamtnp kmc enraomnan non........................ Nd earning... ............................................ i Earnings per tae Beta cdnwdinary lam --.................... Nd earning.............................................. At of December U986, the Company and the BaMunno Company combined tuir drttnc fluid ependore and famed M-l Drilliig Fluids Company, <Mi is a pmtnerdiip caned 60 percent the Cmupany and 44 percent b* Halliburton. M l Drying Fluids e included as a consobdaed subsidiary. HaUtotoo's equity is included in die Minority Interest accoufe on the 1588 and 1J87 balance tats and oneness oi tamings. HaBXurton contributed approxtaately $75 ariDim of os amets, including apprnfenaiefy $45 mdbon at waring capital, for in towtment As of September 1, 1967, die Conqsany and GeoJognph-Hnnee', Inc. combined tie Compaq^ 9wa> opeitaa and Oeotopapb-Ptones, Inc's 9nhk procealpg, praun control and 1% InatnuneatOioc harness Into a ne partnenhq) named Swaco Gcolognph Company The aew paitnenhip is ouoed 65 patent by tie Company and 35 perces by Geolcgnipb-rteoeer, Inc. and is induded a cmwlldsted subaidtery Gealogaph-Pioneer's equity is lndmted in the Minority Irtegt accounts oc Ike 988 and 1987 balance tak and tatnenls of eenrinp. The amount of net am and woridng capital conbliuad by Geotognpb-Ptoneer were not taeriit. la 906, the Company punhased a dfcbfbutor of the Company's coatnection equipment far $22.9 milbor. Also in 1986, the Company purchased the remaining 59 percent intend m a fcrrign substtary. hoFanua OtadWD 1988 1987 ............. ............. ............. 94.I94J6 1493 1606 $1,073.4 63.9 70.4 $2.16 132 $ 05 .93 Note D -- Long-tom Contacts The nocounis ncetahk da net indude any signtanl amounts of cues af coos aad rdoed profits orer amounts billed nor any tipficani amouaB bfled but net paid by cuOemtn uader Homage praririons. Sarioe Rienuts and coa ef sendeet indude the vabe od mmeriak, equipment tad labor canlaete fomkhed by cadomeR far which die Company ts toponaMe far ie ukiaale arapnbtty af perfanaaace of die project bated on such material, equipment ar labor. The ualue af aitfa hems oas $22L6mllion far the year ended October 31, HR NoteE -- Inventories Inventories on the LDO method use $161.3, $268.1 and $374J addon d Oclta 31, HR 1987 and 1986, rapeahefr Under the tmtgi cod method, knemaries would ha* increaaed by $143.4, $43 aad $2326 ntilhoB d October 9,1988,1987 and 1986, mpeettefy During 887 and 1986^ do Company aqieriaiced rigntikant quantty nduefons in tame ef do UR) Hwneong wn mete cameo at mu cow rat pwtaeo m png pad Tnc qutiay lanaciw reduced cost tf saks by $99 9 aodka in 1967 and $48.7 million in 1986. Since m 1)3. income toes em prodded in 1987 and 1986 (See Noe C), the tpmadty reduettons inataaed rut eamtop in H87 by $599 mdbon or $ 80 per dm and reduced the net k* in 1986 b* $48.7 milct or $.64 per tae. Quantty reductions during I9R inept far (manorial omtrlwted te fee beams Dnerpmtnai% maottignificani (IMeBX FnBKu pwiCB Du won n pram umburb w sms on <i ptoftm pyisns on etonen m $10.6, $n.5 and $5U mdbon at October 31. HR 1987 rod 1986, respectheiy. Note F--tatimgfble htaogMes rtfaae to businmro acquttd and conatt prtndpaHr of the dtaeace between puntue price and fair value at date ef aoqukaian of net asm purtbaaed (gvodwi). TheJammiy 11.BByaachme af die bvines and net aaeu dThe M. * Kellogg Company aided $254.0 mtition togpodadl (Note 0 Note G -- taoome Taxes The components of earnings betore income tus are mmmaraed baker On ajlora): l Domestic foreign. Does on income consisted of the Wowing (in millions): i i Current ! l&f*nl.................................................. State......................................................... . I foreign........................................ ......... i Driened Foreign The 1987 currant foreign taxes of <418 mtton contain a chop tf <5-9 idHton eguMent l incanae taxes Oich vouid haw been taurred had foreign operating km tartyfarardi not been antfabk. The tame tax benefit resulting tan uttiring the operating bat carryfaimds is pretested as in atooritary credi. The Company magibed In 1987 and 1996 only three U3. ftdreal tax beneffo dot an be Ttalaed by refund of tare preitouly paid. At October 31,1968, the Company had approximately <204 nnfoon of opening lore carryfcnrtidi awhbte tc reduce future U.5 ftdenl inane taxes for financial reportmg pupoaet line are no domestic operating kas carryfawardt anfiabte fcf to reporting purposes In adflticn. the Company had appranmateiy <2Q mlton oi capital kmes aniafaie fcr bath financial and D5. Metal tax reporting imposes, expirfctg In 19J1 At October 31,1988, toreip opening tots cmyfcevank appmrinnted <100 mdlton, of srtiicfa approximate!* <45 mffltat cgTy forward indefinteiy; and the remaining amounts expire at renous dates hem 1989 to 1994 The Gonpany plaits to conUm* to foance taign operretons tod aqMiaioii hy mmestment of undistributed earnings of its faretypi subsidiaries (appradmately <335 adUnn re October 31.1988); aocnthngly no laws which mgt be payable upon Attribution of rerek earning? hmebeenpnriM The tollmring is a recoocfireinn of iaootDe taaei re foe D3. fedenl inane tu ok to the income taxes reflected in the Gmohdatod Stotomenti of Earning? On Millions): home taxes at lie U3. fodend tamare tax tree af 3<% hr 1988 42* tor 1987 nd 46% tor 1986 MtaortynteM'idiaieafopareioni ..................................................................... Insatoteni tax aeil.......................................................................................... foreign safes wnprinton .................................................................................... Statutory d(|)ledmi ........................................................................................... foreign taxes at reeare of I'A toi tree on ferdgn earoiagi............................................ Charge equwaleot to torelp bonne taxes................................................................ 1 Benefit tf tax basis of pnpenyluextere of book nine.................................................. fox benefits not reoogoired subject to kseureiealiatton ................................................ ! Other............................. .............................................................................. 1918 $ 74.5 104.1 <178-6 19T 5(18.7) _5M 5 393 m IOU) 1148 |228 1988 < 3.7 1.0 mo 747 im <641 1987 <12 418 448 48 t 488 1986 <067) 17 <3.2 482 43 <515 1988 <607 02) 07) 0-6) 119 -- (112) -- 92 < 165 45 -- an 192 S9 09) 13 48 1986 < 90 i1 (64) (15) 160 91 (13) 145 80 Notes to Consolidated Financial Statements (i MiMiii; Note G -- Income Taxes (continued) The drfmd income la* proafatoos (ends) resulted from timing dtitomca alflfe to toe Mkatog (to mflkms): Unqiatrialed foreign earning.................................................................................... taboo liafcHy..................................................................................................... Othrr items indudfcgwnnly, nuance and simihf accnuh............................................ Hal iacme tarns ................................................................................................. Inane (ant paid during the yean endtd October 51,1968,1967 and 1986 anounkd to (to odlUant) 680.9. $41.2 ind $499, reapectweiy. incane tax refunds during the jeers ended Ooober 51,1988,1967 and 1986 amounted to (in millions) Hi, $0.2 and 145.$, mftoMf. Statennt of Financial Accounting Sundards No. 96 ns taued In Deomte 587 and amended in Deceaober 1988. It requires the Company to make (bangs in accounting for tncomr taxes do bier dan fecal year 1991. The Company does not expect 10 adapt tie sMement bite find year 891 D to to cenjtodly of the donges, I is not poafok at this time to estimate the eiSect of the changes 00 the Company's financial position and reults of opentxHBL'hawmx,&prifia amount ofdie defend incoroe tans a Ooober & 1988 will be chaogjgd to Stoefaokkrs' tesunent cr canting. 1988 $-- (10.6) $006) 1987 $35 .5 $.46 1986 $ 34 -- 9 i 4,3 Note H -- Short>fen Debt limsaf oedi for feort-tenm bcnwlnp aggregshig $1400 nObon a October 51I9B, hae beat estabfahed with banks vtihin tie United Sue*. Sudi linet prwide far borrowing n die prevafeng yrtmt iaewt rale. The lints rf qedii may be uaed by the Caqpany and certain foreign nfetdartn, and include Eurodollars and foreign amentia. The Una of credit my be umtosfed s (he option d fee baids or the Gonyam Loan arrangements ha* been estdtehed with banks outs* the Unfed Safes, tmder which fee Company's foreign snbsbferies nay barnwr on an overdraft aid dan-lean note basis. H October 31, 1988 fee amount iralabk and unusd unde feat arrangunats aggRgfed $89J adifen. Suktantalh all shoruem debt awoted of bonosings from foreign banks a October 31,1988,1987 and 1986. The Corfany has undblaaitog with certton cffebaida legating depot* batata at compeoafeo for credit arrangements. but the iggngaa amoutM of nidi oompanaaling balances was not material a October 31,1988. Tie Company was not kgdly matkad Cam vtihdnaatag til or utj portion rf fee compensating balances a anytime during the year ended Oanfer 31.1988. Noie 1 -- Long-Term Debt Long-team debt s sunarurued as foflows (in mflions): Sulking fund debentures, 11K%, due 2107 ............................................................ Sinfcfasg fund detename^ due 1995 .............................................................. SfntangfuoddebenniRS.9Hti,(kcSI0................................................ .............. Eurodollar nets. 12S-5%.................................................................................... Notts p^aMejMX ......................................................................................... Note payable undo Mfctioad Ion ipeerneaa, 8%. dm faamud Malhnate to Jam 1997 Ofeer loin agwemtit, 4.0% to 16.0%, due in IntuNnmk to 3009 ............................... Lea portion doe toft* one yea I Maurite of printipd and stoking fund payments for the fee yon subaquem to October 31.1988 amount to (to milUem) $M.6 In 1989, $12 2 in 1990, $130 in I99L. $B1 in H92 and $226 in >993. 1988 $125.0 11.4 686 -- _ 200 406 265-8 10.6 $255.2 October 31, 1987 $125.0 166 689 -- -- 211 516 285.4 M.3 m 1916 $1230 20.4 746 75.0 no 212 519 382.5 236 $358.7 Note I -- Long-Tfenn Debt (continaed) The debentures doe 2007 hne mandrtary annual sinking tod payments of <83 HIqd burning In 199S- The dtbentures due 1995 hue miniatciy annual siting final payment of $33 mtition, vdilch haw been snisfied through 1991 In adition, $2.1 million of the 1992 requirement has ben met. The defeature die 200C hare mandatary annul tinting fund paynems cf $5.4 milhvn. iMdi hare been srikfied through 1969. In addition, $5.6 mifton cf the 1990 requteaert feat ban net The loan agreements and indentures contain nqufaeraems far the maintenance of wotting capital and certain restrictions on die paracm of dWdendt As of October 51.1988, ronvniirtatrd retained tamings of $1,152.8 million were free of dividend restrictions under die mod restrictive of tine Parisians. Intern paid during the yean ended October S, 1988,1987 and 1986 amounted la (to millions) $7L7, $62i and $76-3. respectively. Note J--Employee Incentive Ptans The 1982 Stud Option Ptan provide lor the granting of options to oecudres and key employees for purchase of the Company's common shira The Plan vs afcsin&tered bv a cmminee cnratstteg of seven Directors, none of whom is an officer of the Company: The OHmuttee dstigpates any requirement as to writing period or enectie dale. No option can 1$ far a mi of move than in jean from due of pan The qtioo price is recammended by die anfidttee, bat cannot be fats tint HWX of the average price of the shares m the Nor Tfarft Stock Esdangr on tire dp the option am parted. Changes in outttuding option during 1988 and options owdable at October j, 1988 under batik the 1982 pfen and tic predeassor 1972 pfan are as folovs I OutstnaSngtf November 1,1987 ...................................................................... ' Options panted at $22-9375 ............................................................................. | OptlffK CMfPSfid si $1825 to $328125 .............................................................. 1 Options cancelledor espied ........................................................................... 433,6 56,400 <112.9561 (25,875) Outttanfing at October 31.1988 ....................................................................... 551,252 EaerebaHe a $18.25 to 22125..................................................................... 389,050 Shares reserved far panting of future option under the 1982 plan cere 2,447,258 shoes at October 31 1987 *cd 2,418,225 sfeaies at October 31,1988. At October 31,1988, a total of 2369,477 dares were nsened far options ounandtag and futtn options. Undrrllir irmiioftU ssiylrniri TinflfriwilnirTim inlasirflnstpinammoatin|lti111 Ilntidliai and United States dtbent inking ouMde the United Stiles fat certain iceipi mbridfaries. enapt fifteen and directors of the Company and certain enqjfarees represented by a union or In otiier tiirifi or itodnp plans, mm purchase the Company's common cock ticou patrol deductions Discounts from maskei price cf up to 153 are iDowed depending on tic employee* knph of sente. The dSerence betwen the employee's purchase price and current route value is paid fry the Company Under the Deferred Gonpcnatta Pfcn, a ponton of tic incentive compensteion far often and key employees an be deferred for paymratafct tefancat or emanation of cmphputnl aiicr In cammoo shares of tie Computy or hi enh at tic equMest matte value of the common times The accmed tctevieu compensation naaiuty mas K saioueu ay the tuture susnee ct autberaeu tut un issued common sham or treasury stains Ofioen sod key employees of the Company aw eligible to participate in the fafcwna Sad Lite Plan The Executive Compeomtioo Qrornttee of tic Board rf Directors, atac ncarixrs are not eligible far in feard under tic Plan, selects the employees to partidptee In the Plan and tic number of Stock Unte tc be gamed to each. Eadi torn! of Stack Ihiti gams an terari Qfde of four navcraUve fiscal rears of the Company beginning on Nooenher 1,1985 and each odtkcuticnd year theeetfter. For call ftntd Cycle, the Boaed of Dimcian esteffchestic pesfarmaooe objective an which payment of Ausrds is conditioned. Sud) objective ny include, but Is not bmiai to accage annual irtmn on in ternment, earnings per share, anting before tans, or otiier ertatia, or a cambtafao ticreof Nkw ing the end of an Anrd Cyde. the Executive Cooperention CommOee determines whether the objective is met fci such Anrd Qde md, if so, wheto tewds are paid in cub or mid, orone omttastion dash and stock. In 1988,70,400 contingent Stock Unis were granted for the tad Cyde enfrig October 3L1991 and in 1986, D5J91 contingent Stack Umts were panted far tic famed Cycle ending October 31,1989. Notes to Consolidated Financial Statements (continued) Nofel--Opfal Staves H* aufcoriud daws of fie Company chbM cf 200,000,000 cannon dunes and HjOflMNO pnfawi dum Chugs in tawed common shuts during die dine jars ended October 31, 1988 as fafluR: ShuBaNMcnfar 1,1985.................................................................................................................................... kauri in oocntQian wth trapleyet betfa and dn^iend ndowtuat pbm........................................................................... j Shuts*October31,1)86...................................................................................................................................... based tn comection w<fa anpkytt beaeti and dmdend wtatuueit plus........................................................................... Shuts a October 31,1987 .............. bairi in comeaton with tnyloyeebcDeffr snd dividend rtlamuiud........................................................................... Shuts a October 31.1988 ...................................................................................................................................... 82,215*49 59&320 SIMS 146,180 82.955,149 69,875 83M Changes in cmmon tees held as Itaaury shares during the Ane yeus coded October 31,1986 m as felons : Beasury dans a Number 1,1985 ....................................................................................... Purchased...................................................................................................................... j BeosuryAaes* October 31,1986....................... : Purchased..................................................:...................................................................................................... ; buri a cuoiKtnwiA mjieyee benefit ptare................................................................................................ Bosun duns a October 31.1987 ........................................................................................................................... Parchuri.......................................................................................................................................................... taied in comedian aith eqpkjee benefit plans................................................................................................ Usury share a Ockter 31.1988 ............................................................................................................... 5,992257 I,l80j6t 7,172,621 4,072.135 (349,262) 1M95.494 S252J14 (364.749) 15.783,859 At October 31,968, all Wastry dans vae available to satisfy obbgaiooi uoda the Deferred Caupmsataa Plan and employee inoentm plans (See NoteJ) Under die terms of the aitcataic dndend idmcanenlptan, hotel of common duns may hue fefr cadi dividends autuMdally nrinwaed inthe Company* common duns, or fiuy mqr tamabuhihdr auh Addends aid up to $l^pgmot0^cpdciiBicnA|iiyiettadOBqany*camiw thaw. AD dare purchases am vndioat payment of any brjgrage ccgwbrioos orantoeduqu. Oo April 17,1986, the Direoon dedomd a dfridcad dbtrfeikm of oat Rigbt fior each ouatanding dare of Common Sock. The Rigbbvea tend on Aprfl 28,198^ tn duRbobfcn of nooirian Apri % 1986, and expire in ten yean. Initial]; the Rights are not nwdabk, certdfcae ha* not been tawed, and tfie R#ib autmuttcally trade aib the Caramon Stock, loaner,lea dqs after a pern or poup efiher sequins 20% ennonefthe Cwnputy's Cuntnon Stock, or cnmmmnu a tender dhr dal mild mult to such person or group cutting 3051 or oust id die oataandtag dam. da Mgbavrl become enebabk, and sepana certtfaua npreserttagtie Mg*s wfl be dbtrfcaed. The H$a hue no wring purer. Vhn the RigNs first become esescbahle, a holder wiD be entiled a buy ok oae-hundredll of a than of anew aeries tfJinaMfinldpaingfttfaied Stock at a pmchou price of 868. If da Company h tombed In a merger or aha butinas combination a any due when there la a 29% or aan stockholder cf the Guqunjt the (d^Us odde a holder to but a nuariier f dona of catunoo aock of die acquiring company hating a taaket mine of arice the eaocae prior af uch R0K. Allematiwijt 1 a 20% bolder aquae Ac Cunpaty by means <f a name meqa, hi abdi fte Canpony end ib Uod savlw, w i any perwn oaptoes 30* or nose of the Campany1* GososnoD Sadr (otixr thu pursuant to a tender offer or exchange offer for dl outstanding dues) eub Right not owed by a 20% or oaose duRhaUa aauld becoue etedobk fa Gammon Stock cf (he Caqpmy (a; hi catain ebeanatnees, other consAarion of the Company) haring a mad* whaequd to take da eaacbe price <f the Right The Kgha may gueraly be adeemed by the Ganpaty a five can pa H0N prior i da fine in* pawn or gmup has uqubed 21* or more of the Company's Conanu Stock. Note L -- Comndtoects and Caattagendes Uhgahon Tbe Company his been engaged in patert-rebtod lib^aton nth the Hughes Tbol Cooopmy and its successor, Baker Hughes Incocporded (Hugheai Busies chrpd the Company ortth tafringensmt of tw US patents rektiiig to structure thta a journal bearing rad bn On July 21,1988. tbe Company and Baks Hughes Ineoiporaced readied an agreement settling the lttgstkn. Hods the terms of the $nm, Baker Hughe received the Company's 27.66% interest to BJ-TKan Services Canpany a partner djf owned by tbe Canpany and Baker Hughes, and (23 million in cash. Based cn this seKkoent, oo August l, 1968, die Daniel Court catered an order dismiwing the lidgatian. Tbe Canpany and its sobeidiiries ait invoked a certain odm legal actons and chins aitng in the anbury coot* of dieir business. It fc the optatoo of management (baaed on advice rf legal counsel) that such legation and data* will be twdved without arterial effect on ihe Company's financial [KawOtL Other The Company and certain subsidiaries ue contingendy Uabk as gparanton ct abhgadoos aggregrtng approximately 137.5 ntdlion at October & 1988. `Baal rental and lease eqiense charged to eammpvas (73.1 mdliot in 1988, $6x6 adUm in 1987 and (79 5 mdikm in >986. At October 31,1988, be agpegtoe autonum mart chfigstton under noneanedabk lease were (In millions): 4.6 far m (29J0 fcr m tK2 In 1991; #96 fcr 1992; #59 893; and (80 3 fa all subaequent yean. The kase obUgatom eefane primarily to general and aks office space and warehouses, induing 15 years remaining an the lease far sflloe space in the Drewr-CuBea \fcntute (50% o*ned See Note B) buibbng at a amt* annual Me of appratimedy (42 mdion subted 10 escalator far operating cat*. The tffect on die Company's finandai paritoo or results of operations would not be signifaflt if exiting espial type leases we cqdtaitaed and amortized over the kase period. Note M -- Ptenston Pfans and Retiree Benefts U.S, ami Cmadm Attsioa Pkm The Canpany and Ms subsidiaries have pension plans covering sdMantfaBy all US and Canadan employees. The benefits for the plan cowering tbe salaried employees are based primarfy on yean of seme? and employees' qualifying oompensrtion during the final yean of enploymenL The benefits for the phns centring the hourly employees are baaed primarily in yean of service. The Company's knding policy is comttent uith the fending ngubements of Mni tar and saguhheos. About 98* o( the plan assets ire invested in cash, short-term rrwtmenfc, bstod nocks, and bond. The tot of the pkn assets are ptlmatfty invested ii real estme and insunnoe contrartipnsthasriiromMe Issunnoe companies. The 1988,1987 and 1986 pension costs (credit) include the fatortng ccmponenU (bi nadlioos): Senke cost hr benefit caned durtog 0* period I Inmt*oosminjectedbendtottgdon... 1 Actual renin on plan awe* .................. ^ wummi B---w-0 flBRill ....... ............ joint nature aduummB......................... : Ha pension coeh (emit}........................ 1988 ( 12.7 02.91 <M> (ID* 1 55 W87 (19.6 99J (29.4) (HJ) C2) $ 5.6 1986 J 17.S 56.0 <B3> (!? -- ( <7* 41 Notes to Consolidated Financial Statements (continued) Note M -- Pension Pints and Retiree Benefits (continued) US md Cmedun ttnaon Pknts (continued) The assumptions used (d develop the net person cans (credit) for 1968, $87 and 1986 wte: Dbountmt................................. Espeoed long-tan nfe of rebn on lsets Rtoe of increase In anpenattor lewis .. 19H 8.75% 9-80% 5-50% 1987 8.75% 980% 550% in >986, to Company adopted Statement ot Financial toouating Staodanis No. 87 (SftS 87), "Enfloyen' Aocoimtiiig for Postoos". ftmtoo costs fer 1986 under SRS 87 art a mflbon credit advert $38,6 tailim ($.50 per due) lower lhai they would hue been imder the pmrioua account ing tfandards Effective May 1,1906, the Company temmned to l[.S pension plant for ohried eaptoytes in coanettion wth a rwersion of the pita' surplus funk ad adopted 0 ucoanr pentoo pfaio i& a afferent benefit fcnnula. The nloried retirement plans purchased in annuity contract for approadnaady 18,000 members d the penaon plans guaranteeing the payment at (heir bens pension kueto. In comectlor vtth this termination, epproxinuceh $1290 mllton of plan isets ravened to the Company The Company also temiaad oatui hourly ponton ptonniuring t98S, 1907 and 196 aad $110 mRion, 158.9 miUJoc and 151 miBion, topecMy, of phn asms reierted to tie Compaq Tbe Company adopted Statement ef Fhtadal taunting Stalai* N& 88 (SBS 88%, `tnptoyers' tawting for Settlements tnd Curatiments of Defined Benefit teuton Plat and fix TbmtMtion Benefits". In accordance with mqufcmeott cf SftS 88 coocemtag Mtement of plan UMita, the Company rcrogeijed gains ef flj.6 million, $88.9 mflbon and $6l? nation hr the yon ended October 31- <568, 196? tnd 1986, wpecthely The ifierence between tie uoets chid) rwerted to tie Company tnd the Mol gains ef U64J oftan is toduded in lang-tni pendon pkn tabdffles. The etfect of lie adopttoa in 1987 el Stoknent of Financial tammtlng Stondtoti Na *7 ad Mo. 88 fir the Cutodla pension phm vas not agnficant The funded status of the plans a tbe measurement dales, August 1,1988. 1987 and 1966, ns at Mias (in millions): Haas with AsefiiradiagAcxaniMed Benefits Actuarial peesent value of bmfit obBgntant feted benefit oMgtfm................................................................................................. 15881987 1133-1 1151.6 iooBouhaed benefit obHpakn.......................................................................................... ( 1370 1 1573 Projected benefit abtfcaian............................................................................................. Plan sesebal fair mhie..................................................................................................... Projected benefit obliattoa (over) under plan uhQ.......................................................... Uniwmntard net (gain) has................................................ .......................................... Prior serrioe cost not yet recoprbtd in net periodic pention rat..................................................... Bcnnining unracognfaed aet (arret) oblgfeon aiatng < dde of afcpdon of 5S 87 ......................... Prepaid powori com (peerion fattlty) recopioed a ofAupBtl ................................. ............. $ 18.1 215-1 %t> (4.9) 5.1 (48.1) 1 18-1 1159-6 241^0 ffl.4 (.5) 5.2 (64.3) $ 21.8 1986 10 00% 9-00% 550% 1586 IBi? $2*8-3 1M8.7 3899 141.2 (29.8) 3 (188.9) $_ 2J 42 Note M -- tension Plans and (Mice Benefits (coatmaed) U.S. and Canadian fbtskm Plans (continued) Hans nib Accumalaaed Benefit Eaceediai Aasets Actuarial proem value of benefit oblationswatt DtDfoi onngpnfMi.......................................... ............ ............ Vowuitaed benefit otdl|ion ........................................................... Projected benefit obfcpbai................................................................ Pfanrusefc* fair value ....................................................................... Projecud benefit obbptm <owr) underpin awes....................................... Uareoogniaed net (gain) kw ............................. .................................... Prin seivto con nMyancopuied in oetpehoik pension cot.................-- Renwining unrecognized net (art) dfafcgation stating n dtte of adeptioo of SMS 87 Pecpaid pendoa cots (pension ItaMty) ncagntad as ofAugust 1 .................... The current portion af pension liability is included In "Accrued oanpensMon and bemfita". The mimphoos UKd to develop fee projected fawefacbtaption in 198,19*7 and 1986 rere: Dimunirde............................. ................................................................... Impeded tag-tern nfe of Mum on awes ........................................ ................. Raeof increase in oanpensMon kwh.................................................................. 8.75% 900% 5.50% Ctifmed Contribution Plans A wtofly-wned md i rrejorfiy-wned subsidiary maintain defined cnrftuMan plus far ant U.S. ataried employees. Under feese plans, eligible employees may contribute anouEfc through payroll deductions supplemented by erapiow contrfetficns for investment in nriaus fundi estabifched fc the plats The cost of these plans was $4.1 million in 198. Neu-US andNon-Canadian POnatm Nans Fenswn cuwnge far empfcma af the Company's notvUS and non-Canadian consoMned subofcfaries is provided, to the extent deemed wopriate, through separate plans. Ofafigrttas under uch plans an systematically provided for fay depositing funds wife trustees, under Insurance pobda or by book reserves. The pension esptme far feese phns was $5.6 mittta, $6.5 odHon and 111 sdUta far 198, 1967 and 1986. reydively The actuarial present ndue of amiwMswi plan benefits at October 9, 198 was $69.5 nUKon (rf wldch $2.8 mfiliM was noiwwned) compared with net a** aniable far benefits of $106.8 ndiboa The aoumed Ktage rale d return wed iu deJonaning fee aduarial pnsett mine of benefit was 17%. The Company amt apply SHS 67 to feorofeseigpbsttd pension plans no \m than fiscal yesr 1990. Due 10 the compkxty of the danger ad die number of aunties aad plans involved, the Canfany has not determined when fee stnement will be adopted, or the effect it wll haw a the Company's financial pcsfiton and route of cpcoUons. CmsotUotai Ounpiinj On a oonoUdned bads, potion cons (credits) wen $152 miKoa in 198, HU mttoa in 1987 and 1(17) million in 1966. fWmW fXNQmS nation to prawning person nenenB, neuapaif am us uaiaiafis pmnoe wiain mmo erne and fife immune benefits far retired employees. Moat of the employees who Mhe fiat die (Japan? are efigfek far these benefits. The coat of retime btatt are is nosgqtad as an apaw as data ate paid, and the am of retiree Ife tosunace is mcognaoi by expensing the animal fauna pmntums. Ttree com totaled $l9i millien in 1968, H5 7 mtton in Q67 and $15.9 ndBtnin 1966. 198 $_75j $ 79 9 1 1295 526 (719) .2 (2.9) (20.9) 1(185) 1967 $ 48 3 $ 95.1 1120.3 226 (97.7) 5.6 4.1 (HO) 1(1010) 1906 yy $ 15.5 $ 116.7 1.9 <114.8} 162 .1 (17.9) 1(116.4) 4$ Notes to Consolidated Financial Statements (continued) Note N -- Special (targes aad Suppfcneotury locone Stfemte btfxniioo $Ndo/ Cbarges During 1985 and 1986, significant uncerttindes in die markets b certain product) aad tunas related to oil and gas, sled, and mining cued the Company to enhdtc editing rod continued iavemnent ml mppmt of products for these industries A serial charge of 1253 mfltai was made In the third quarter f 1986 to mte-doim tite aces equipment. Set Mole 0 far iidbnnation moaning ibe amount of the speaai charges by sepneni of the Ccmpwiys husoes and geognphod taetitas. Supplementary ham Statement hformotom Earnings per common share are based on the average number of connon shoes outflmSog during eodi period The range oomsnon shares outstmlng were 6<M million to 1968,75 3 noillfen to 1987 sod 766 auDiac in 1986. Outstanding stock option ind other commoa stack equtoleas do not hue x mrienai efiea on earamp per riuue. Depredation, (kpletom and amortbattat f property pint sod equipment charged to earnings amoumed to $9$.4 milboo in 1988. $129.5 Bilbos in 1987 sad #60.9 mlliao in 1986. Research and dewtopoert cost charged to tunings amounted Is $Z7.4 mlbac in 1988, $32.4 milks in 1967 snd $62.9 milion in 1986. The year4D-year decreases in depretiatsen, depletion and amortiation charges snd in research sod devcliopinmi casts ire primarily doe to fa transfers of certain opeotions to Ibe hewer Kind and Vtotem Adas join ventures (Nett B) Net foreign exchange adjustments, including pins and tees fro* bods settlement cfoommerchl trans^ adions and translation atfirntmenes far highly inflationarycountries (primarily Argentina, Bast and Meaco), resuhed in net tees of $13-* mdUon in 1988 and $7.1 milks in 1967 and aet gains of $7.1 mllion in 198& Net foreign eahaoge afliawnbaie induded in "Oicr team (deductions)- NoieO -- Infrraation by Industry Segment and Geographic Area Ob January 11,0H, die Company acquired substantiaBy d of ihe bunnes af The N. * Kellogg Geopant, a process agineering and anmetton firm (Note 0 A new Engineering Services Segment a repined ior 1988 consisting of die acquired lefogg operettas Md tire enrimnmmial padre* operates dm sere fcmeriy in die Energy Procuring and Gonrerriou Equipment Segment The former Petroleum Operations Segment has been (earned the OAekl Operettas Sepnmt During 088, the gasoline dfcpensing system burins ai tmmfand fan the Olfirid OpenUtas $egmes* to the Enesgy Processing snd Gonversta Bqugmeat Segment ad the orials taring hurias was transferred {torn the Oflfidd Operettas Segment to to General Induriry Sejnent Prior year daa have been rested to antes lo the ament segment riigmeoL The Canpany's fire tadurtry segments are as foites: Qtiflekl Operations TtUs sepnent presides produces and ledtacal aernceo for ofl and gas oel oftonrioo, Mting and production operations. Principal products and services todade MUng fluid sytemt, sack bte, dwuhoie production teds, pttmlwan mrvicei -- teytad lewoi dewjpttai, eejaabt ortas, cm analysis vnnbne logging sente--end oortaq/driling rigs On M^r 1,1987, certain petraieum mnacei assets were tnumeneo to seen gnat tntensoorai, me. uwe o/. un iwhibw i, qa>, me Oompany md HaUaoioa ceabtad dte driiiqg ftridi turinemes to ten H DriUtng Fhork Goapany (NcttO EMr&froasstogeMlGmierjxmBqidpment This Kpaem pmrides jwoducs and qitet utilised ii oil and gas pmduetian; ol and gm pipebaes; ihe pneesang or oomersion ofol gu and ceol inm other energy tans; and marketing epecaiom. Itajor jmhicB. sente and ansns include compraan, pumps rieam nahuM, dtel mgmes, meaauRmem and oonooi devices aad gmoHne dbpeoaing Syrians. On Jumsry 1,087, certtta ccnrieacr and swam turbine operating owe naadwed to Owaes-lhnd Ocmpacy Ote B). 4^ Note 0 -- Information by Induary Segment aad Geographic Area (coolwetO BKffumiug Servtca Tbia segment pronto engineering, constmaian and reined sente primarily to die bydruaitai proas industries. It also designs, produces and inslals position control equipment in coal-fired power pints Abimg and Gorntructm Equpattat This segment is a producer f equipment for muting, earth moving aid mad sakaeunce apentians primarily conducted by die coal and cansmictioo industite. Major praduds include walking dnglnes, cortioioas mining mtdtius, oornpaoJon rollen, motor gtaden, htd leaders, enwier tractors, acvMors and off-higbwy trucks. On Sqrtenber 1,1988. connrudion equtpmmt apentkm in the OMem Hemfephete were transferred to Komrisu Dresser Company (Note D Comal tmbutry 71ns segment provides produoei for industrial ml ctmnienial applications dot are used befo as end products and as components d tehee produett or aasaens. Products Include refractories, pipe tangs axad couptings. pneumatic toab and priced lead and retard anneals. The abrasive prwbet operations were sold as of June 30.1988. fetai revenues include sales and grvto to uniflHimriaBtwiridtalnn,r^^ sendees or intergeogaphic met sates and sendees. The inttnegnent and tmeggeog)ni|ihlc area rales and runes are accosted for at prim which approiinrae arm's length market prices. No sfcgk customer accDunted for 10 percent or more of total sales and soviet revenues. Operating profit consists of total revenues less tub! operating ogtemm General enponk fspemes, pension plan settlements, inttrest expense, incaax tax* and equity in uadntifowled eamiogs of ynconsnlidaied sutaidtato and aMfeshme ten eadaded in daenninliig (jeering psolildenJtiaUe aaets are them amets ft* identified with particular regmen or geographic areas. Gospatrae aaaes are prindpaly cadi, iorHenu Inwsimerts and itcefraMes. The Inniaal iafonratian by Industry Segment and by fimpaphir Arts far fa yean ended October 31. 1988,1987 and 1986 is as fallows (in aadbona): 1988 Industry Segnent Sales and sente mooes to MafBbated cuatomas aUhra^t.diaj ujv p--m.i-m-- ........................ .................................................. ..................... Enerp Processing & Conversion Equipment ........................................... ..................... Engineering Services........................................................................... ..................... Mining & Construction Equipment ............. ............................... ........ ..................... General Industv ............................................................................... ..................... Imersepnent sales and service revenues Oflfidd Operattoetn ............................................................................. Energy Processing&ConvenionEquipaMrrt --...................................... ..................... Mining ft fnflpfHrtkni ....................................................... 1 5539 1,282.8 742.5 8*37 498* 5.6 General Industry ............................................................................... ....................................9 Eliminations ........................................................................................ ..................... m fetal sales and savit* revenues.............................................................. ..................... 13541.7 1987 $ 515-4 1,1979 453 8995 4636 6 1.7 .1 2 06) <3.115.7 1986 $ 683.0 1.514.9 54.6 949-2 4596 .2 25-0 .5 5 (242) &6615 45 Notes to Consolidated Financial Statements (continued) Mole 0--InibniHticM ty bxfastry (cofdtaoed) 1968 Inthwtry Segment (continued) Opatiing profit qudgu upennons ................................................................ . Energy Prooesting & Camnioo Erpupment.................................. Engineering Serrtas................... .......................................... Mining ft Construction Equipment ............................................. General Industry .................................................................... AdfuUmems and eftmiiifltfaaMS..................................................... Subtotal ............................................................................... Special dtages -- Oilfield Opentitas............................................. PMicnhp opentxra Energy Processing & Cowetaon Equipment .................................. Mlntag 4 Contraction Equipment ............................................. Ital operating prrtt .............................................................. ......... ......... ......... ......... ......... ......... .......... .......... $ 41.9 110.3 186 13.4 40.1 ........fcP 26i2 -- ........................ 5 ......... .5 ......... 265.2 Genenl oorpertie expenses.......................... ................................ CKhff norHegmert opens ......................... ................... ... fanon plan setdemenB .......................................................... tatoest expense, net.................................................................. | Earning? before taxes ............................................................ ......... ......... ......... ......... ......... (90-2) (44.9) 13.6 (51) 6 1716 ' Eqnity eantiags Odfidd Operation ................................................................ Processing & Ccnwrtion Equipment ................................ j bitpneamg jqvib....................................... ...................... Mining & Construction Equipment ........................................... 1 General Industry .................................................................. finance, Issuance and Real Esttie uncoraoMdtied asbudano ....... 1 Equity eaminp from continuing openttwra ................................ rMoYwHipd qpwftiqfft ........................................................ ^ Mai equity earnings ............................................................ ' Mwlifclili agsets j Oilfield Opeotiom ................................................................ Energy Pracoting & Camertion Equipment ................................ Engineering Services.............................................................. Mkwnfl t CtMjHitrtitm ........................................... Genenl Indutiry .................................................................. Adjusttnrts and dtatatkaB................................................... j Mai MknBfkMe aaeti.............................. ............................ ......... ......... ......... ......... $ 10.5 (1.1) 3 .1 ......... ......... ......... ......... 4.9 144 22.7 1 373 .......... .......... ......... ......... ......... .......... .......... $ 3994 766/4 3653 462.7 210.4 01.7) 2.1724 Eqdty tavenmls UuMO UpCnMfB ................................................................ Energy Pnooting & Omenta Eqilpraem ................................ Serncei..............................................*............ Mining & Contnctioo Eqniptnent ........................................... Genenl Indutiry .................................................................. Finance Insurance and Real Exne uacauofidtied tubtidbrie ........ EqoRy lirauiiux m oibimpi opumos.................................. Mai equity lntoanafs ........................................................ frvjwrrtp ilk .................................................................... Mai assets......................................................................... ......... ......... ......... .......... .......... .......... ......... ......... ......... ......... 2693 1354 .7 1394 23 174 5044 __ 5044 2214 *m* 1987 t (544) 1113 24 (l&O) 61.0 (17) in.$ -- (364) -- 63.7 (506) (13) 849 (615) < 393 t 12 .3 -- .6 (1.4) 41 94 26.7 % 36.5 1 3941 8513 233 5424 2744 057) 24554 2174 1244 -- 195 3.5 40.4 3964 1733 570.1 2573 (24823 1986 $ (464) 75.1 45 27.5 141 (2-9) 803 (253) -- ___ -- 55.0 (440) (74) 617 041) | 224 S 33 (4.9) -- 15 (1.09 7.9 74 254 t 33.4 t 550.5 1,004.1 193 4914 2845 C74) 23143 43.6 344 -- 32.6 6.5 401.0 5175 517.5 274.4 0.1102 46 Note 0 -- Information by loduMry Segment and Gwgrsphk Are* (cootinoed) Industry Segment (coationed) Capital expendiure. Olfield Operations ................................ Energy Processing ft Concrsion Equipment . Engineering Seniees... ........................ Mining# Constnjc&on Equipment............ General hdastry.................................. Corporate ...................... .................... Real ap&J apendUure ....................... Depredation, depletion nod omortiatfon Oilfield Operations ................................ Energy Processing & Comenta Equipment . Engineering Services.............................. Mining & Construction Equipment ........... General Industry .................................. Corporate ........................................... Taal deprecation, depletion end sroorliatJon ! Geographic Area ( Soles and rente revenae to nniflMrard auumen Lnlled Slates............................................... Canada ..................................................... Latin America ............................................. ; Europe....................................................... | Mid East ftr East and Africa.......................... ' Intergeographlc area sals and rervice revenues | United Sues .............................................. Utm America ............................................. Europe ...................................................... Mid EasLftr East and Afcica.......................... j Efanmattons................................................. ! Hxal sales and service rerennej....................... ! Operating profit United Stales............................................. Quads .................................................... Latin America ........................................... Europe..................................................... Mid East, FOr East and Africa.......................... fOpaBOtn luO CMIlSaDQfll......................... Subtotal ................................................ Special dorps United Stales............................................... Camda ..................................................... Partnership operations United States............................................. .............................................. j btin America ........................................... I Europe..................................................... | Mid East, ftr East and Africa......................... ! Ttol operating profit ................................... 1988 ___ 1987IJft^ s tat 291 48 8.4 8.6 15 * 42.5 1 70 22.5 3 10.2 67 10.7 8 57.4 S .l 266 .4 11.3 80 ___ 13 8 7i.i % 25.0 317 137 7.6 136 53 $ 96-9 I 55-4 345 .4 7.1 167 63 8 120.4 8 811 503 3 5.2 173 63 8 162.0 82347.0 2369 215.5 8083 434.1 1833 75.9 160 219 1.7 (2977) 33041.7 81.966.1 1669 164.7 664.4 157.6 163.7 736 17.7 54.S 55 (3150) 83.1197 823743 2313 175.6 6914 1890 1976 603 12.7 57.7 60.6 (3189) >36613 % 154.1 27.7 283 283 283 m 2643 -- -- 09) .4 13 2.4 1.1 $ 2653 $ ad 13.0 17.1 57.7 47 67 100.5 -- (288) 1 (22) (67) 3 8_ 87 S (49 0) 21.7 189 57.2 293 82 803 (233) (23) -- -- -- -- L 553 47 Notes to Consolidated Financial Statements (continued) Note 0 -- lnfcraaioB 1>y Industry Segment and Geographic Ana (coatimted) Geographic Area (coatiiwed) Eqrty earnings United Suits............................................................................. .......................... fanirfa ................................................................................... .......................... Latin America ............. ............................................................... .......................... Europe..................................................................................... .......................... i Md East, Fax East and Africa........................................................ .......................... EqttHv eandrp from continuing operations ................................ .. .......................... Dtscortinued operators .............................................................. ........................... Heal equity earrings .................................................................. .......................... 1988 $ 103 .2 23 .4 1.4 14j6 22.7 $ 373 UendWrir assets United Stats............................................................................. .......................... Canada ................................................................................... .......................... Latin America ........................................................................... .......................... Europe.................................................................................... .......................... 1 Mid East, Par Eat and Africa.................... ,<................................ ............................ M|QSllDttS Ufl qODMMHM........................................................ .......................... Tool identifiable asets................................................................ .......................... I134U 74.4 78.9 461.8 144.6 (I28D) $21728 Untied Seas export sales Camda ................................................................................... ............................ Latin America......................................... ................................. ............................ 1 Europe..................................................................................... ............................ i Ifid Eas, Far Eut and Airia........................................................ ............................ i tad Unfed Sms sport ski....................................................... ............................ $ 34.9 1114 50.7 2040 $ 401.4 1987 $ 9i 4 (3) (.4) 3 90 &? 1 365 11323-8 120.1 97.4 557.6 1196 (16J.5) $28558 $ 30.0 1010 498 130.9 $ 3117 1986 $ 4.4 -- 1.1 .6 1.7 78 256 j 33 4 $1608.7 1213 1217 5078 1558 (1978) $yi&3 $ 25.1 1304 733 _222.5 $ 451.9