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8-K - 8-K - RPM INTERNATIONAL INC/DE/d631994d8k.htm

Exhibit 99.1

RPM REPORTS FISCAL 2019 FIRST-QUARTER FINANCIAL RESULTS

 

   

Sales increase 8.5% to first-quarter record

 

   

Raw material costs and restructuring expenses affect profitability

 

   

Operating improvement plan implementation continues to streamline costs

 

   

Comprehensive plan update to be provided at November 28 investor day

Medina, Ohio – October 3, 2018 – RPM International Inc. (NYSE: RPM) today reported financial results for its fiscal 2019 first quarter ended August 31, 2018.

First-Quarter Results

Fiscal 2019 first-quarter net sales were a record $1.46 billion, up 8.5% over the $1.35 billion reported a year ago. Including the impact of restructuring charges, first-quarter net income was $69.8 million versus $116.4 million in the year-ago period, and diluted earnings per share (EPS) were $0.52 compared to $0.86 in the year-ago quarter. Income before income taxes (IBT) was $91.9 million compared to $155.3 million reported in the fiscal 2018 first quarter. RPM’s consolidated earnings before interest and taxes (EBIT) were $113.9 million compared to $177.6 million reported in the fiscal 2018 first quarter. The fiscal 2019 first quarter included asset write-offs and other restructuring-related expenses of $39.8 million. Excluding these charges, RPM’s adjusted EBIT was $153.7 million and diluted EPS was $0.76.

“We saw strong top-line sales growth in the first quarter, with organic sales growth up 7.8%, while profitability continued to be adversely affected by rising raw material costs. In addition, bottom-line results reflected the impact of restructuring charges, higher legal and advertising costs in our consumer segment, and the adverse effect of transactional foreign exchange,” stated Frank C. Sullivan, RPM chairman and chief executive officer.

“Our team is focused on driving increased profitability, long-term growth and enhanced value for our shareholders, and we are making good progress in executing on our operating improvement plan, which is specifically designed to increase margins, reduce working capital, and improve overall operating efficiency. During the quarter, we continued our strategic restructuring initiatives, including the reduction of more than 150 positions and the announced closure of four manufacturing facilities, all in line with our 2020 Margin Acceleration Plan,” stated Sullivan.

First-Quarter Segment Sales and Earnings

The company’s industrial segment net sales increased 7.2%, to $782.0 million from $729.8 million reported a year ago, reflecting organic growth of 6.7% and acquisitions contributing an additional 1.6%. Foreign currency translation reduced sales by 1.1%. Industrial segment IBT was $69.1 million compared with $88.9 million a year ago. EBIT was $71.5 million compared to $91.5 million in the fiscal 2018 first quarter. Adjusted EBIT, which excludes the charges mentioned earlier, increased 2.5% to $93.8 million from the year-ago period.


RPM Reports Fiscal 2019 First-Quarter Financial Results

October 3, 2018

Page 2 of 4

 

“The industrial segment benefited from especially strong performance in North American waterproofing and a healthy recovery in our businesses serving the oil and gas sector. Leverage to the bottom line was masked by unfavorable transactional foreign exchange expense resulting from the strengthening of the dollar versus certain international currencies,” stated Sullivan. “In the process of realigning our global brands, we adjusted our leadership structure, initiated the closure of two plants and discontinued certain international product lines.”

RPM’s consumer segment generated a 13.6% increase in sales to $485.2 million from $427.1 million in the fiscal 2018 first quarter. Organic sales increased 12.4%, while acquisition growth contributed 1.7%. Foreign currency translation reduced sales by 0.5%. Consumer segment IBT was $51.3 million compared with $72.4 million in the prior-year period. EBIT was $51.5 million compared to $72.6 million in the fiscal 2018 first quarter. Excluding asset write-offs and other restructuring-related expenses, adjusted EBIT was $52.9 million versus the prior period.

“Consumer segment sales were strong due to new accounts and market share gains, particularly in wood stains and automotive finishes,” stated Sullivan. “As previously discussed during our fiscal 2018 fourth-quarter conference call, we anticipated that the fiscal 2019 first quarter would be the high-water mark for margin erosion in the consumer segment. We responded with price increases late in the first quarter to help address this. In addition, legal costs accounted for nearly half of the EBIT decline for the quarter, with much of the remainder resulting from stepped up advertising to support recent market share gains.”

RPM’s specialty segment reported sales growth of 2.3%, to $192.8 million from $188.5 million in the fiscal 2018 first quarter. Organic growth contributed 2.0%, while acquisition growth was 0.4%. Foreign currency translation reduced sales by 0.1%. Specialty segment IBT was $27.8 million compared with $33.2 million in the prior-year period. EBIT was $27.7 million compared to $33.0 million in the fiscal 2018 first quarter. Adjusted EBIT, which excludes restructuring-related expenses, was $30.5 million in the fiscal 2019 first quarter.

“Specialty segment first-quarter results for the prior year were elevated by our water damage restoration businesses’ response to Hurricane Harvey, which created tougher year-over-year comparisons. Also, the first quarter of fiscal 2019 is the last quarter of negative comparisons related to the NatureSeal patent expiration last August,” Sullivan stated.

Cash Flow and Financial Position

During the fiscal 2019 first quarter, cash used from operations was $7.1 million compared to $26.1 million a year ago. Capital expenditures were $28.3 million in the quarter, compared to $17.5 million in the year-ago period.

Total debt at August 31, 2018 of $2.27 billion compares to $2.17 billion at May 31, 2018 and $2.12 billion at the end of last year’s first quarter. Net (of cash) debt-to-total capital was 56.2%, versus 54.7% at the end of last year’s first quarter and 54.2% at the end of the prior fiscal year. Total liquidity, including cash and long-term available credit, was $868.9 million, compared to $1.0 billion a year ago and $1.0 billion at May 31, 2018.


RPM Reports Fiscal 2019 First-Quarter Financial Results

October 3, 2018

Page 3 of 4

 

Business Outlook

“Our businesses will continue to aggressively pursue price increases to protect our gross profit margins in the face of continued raw material cost escalation. With asbestos trust payments now behind us, we are implementing strategic initiatives to enhance shareholder value through operational improvements and improved capital allocation. The current phase of our restructuring program is proceeding as scheduled with recently announced plant closings and leadership realignment. We will share a comprehensive update on our plan at an investor day on November 28, which will be webcast via the RPM website at www.rpminc.com,” stated Sullivan.

Webcast and Conference Call Information

Management will host a conference call to discuss the quarter’s results beginning at 10:00 a.m. EDT today. The call can be accessed by dialing 888-771-4371 or 847-585-4405 for international callers. Participants are asked to call the assigned number approximately 10 minutes before the conference call begins. The call, which will last approximately one hour, will be open to the public, but only financial analysts will be permitted to ask questions. The media and all other participants will be in a listen-only mode.

For those unable to listen to the live call, a replay will be available from approximately 12:30 p.m. EDT today until 11:59 p.m. EDT on October 10, 2018. The replay can be accessed by dialing 888-843-7419 or 630-652-3042 for international callers. The access code is 47510575. The call also will be available both live and for replay, and as a written transcript, via the RPM website at www.rpminc.com.

About RPM

RPM International Inc. owns subsidiaries that are world leaders in specialty coatings, sealants, building materials and related services across three segments. RPM’s industrial products include roofing systems, sealants, corrosion control coatings, flooring coatings and other construction chemicals. Industrial companies include Stonhard, Tremco, illbruck, Carboline, Flowcrete, Euclid Chemical and RPM Belgium Vandex. RPM’s consumer products are used by professionals and do-it-yourselfers for home maintenance and improvement and by hobbyists. Consumer brands include Rust-Oleum, DAP, Zinsser, Varathane and Testors. RPM’s specialty products include industrial cleaners, colorants, exterior finishes, specialty OEM coatings, edible coatings, restoration services equipment and specialty glazes for the pharmaceutical and food industries. Specialty segment companies include Day-Glo, Dryvit, RPM Wood Finishes, Mantrose-Haeuser, Legend Brands, Kop-Coat and TCI. Additional details can be found at www.rpminc.com and by following RPM on Twitter at www.twitter.com/RPMintl.

For more information, contact Russell L. Gordon, vice president and chief financial officer, at 330-273-5090 or rgordon@rpminc.com.

# # #


RPM Reports Fiscal 2019 First-Quarter Financial Results

October 3, 2018

Page 4 of 4

 

Use of Non-GAAP Financial Information

To supplement the financial information presented in accordance with Generally Accepted Accounting Principles in the United States (“GAAP”) in this earnings release, we use EBIT, adjusted EBIT, adjusted net income and adjusted earnings per share, which are all non-GAAP financial measures. EBIT is defined as earnings (loss) before interest and taxes, with adjusted EBIT, adjusted net income and adjusted earnings per share provided for the purpose of adjusting for one-off items impacting revenues and/or expenses that are not considered by management to be indicative of ongoing operations. We evaluate the profit performance of our segments based on income before income taxes, but also look to EBIT as a performance evaluation measure because interest expense is essentially related to acquisitions, as opposed to segment operations. For that reason, we believe EBIT is also useful to investors as a metric in their investment decisions. EBIT should not be considered an alternative to, or more meaningful than, income before income taxes as determined in accordance with GAAP, since EBIT omits the impact of interest in determining operating performance, which represent items necessary to our continued operations, given our level of indebtedness. Nonetheless, EBIT is a key measure expected by and useful to our fixed income investors, rating agencies and the banking community all of whom believe, and we concur, that this measure is critical to the capital markets’ analysis of our segments’ core operating performance. We also evaluate EBIT because it is clear that movements in EBIT impact our ability to attract financing. Our underwriters and bankers consistently require inclusion of this measure in offering memoranda in conjunction with any debt underwriting or bank financing. EBIT may not be indicative of our historical operating results, nor is it meant to be predictive of potential future results. See the financial statement section of this earnings release for a reconciliation of EBIT to income before income taxes.

Forward-Looking Statements

This press release contains “forward-looking statements” relating to our business. These forward-looking statements, or other statements made by us, are made based on our expectations and beliefs concerning future events impacting us, and are subject to uncertainties and factors (including those specified below) which are difficult to predict and, in many instances, are beyond our control. As a result, our actual results could differ materially from those expressed in or implied by any such forward-looking statements. These uncertainties and factors include (a) global markets and general economic conditions, including uncertainties surrounding the volatility in financial markets, the availability of capital and the effect of changes in interest rates, and the viability of banks and other financial institutions; (b) the prices, supply and capacity of raw materials, including assorted pigments, resins, solvents and other natural gas- and oil-based materials; packaging, including plastic containers; and transportation services, including fuel surcharges; (c) continued growth in demand for our products; (d) legal, environmental and litigation risks inherent in our construction and chemicals businesses and risks related to the adequacy of our insurance coverage for such matters; (e) the effect of changes in interest rates; (f) the effect of fluctuations in currency exchange rates upon our foreign operations; (g) the effect of non-currency risks of investing in and conducting operations in foreign countries, including those relating to domestic and international political, social, economic and regulatory factors; (h) risks and uncertainties associated with our ongoing acquisition and divestiture activities; (i) risks related to the adequacy of our contingent liability reserves; and (j) other risks detailed in our filings with the Securities and Exchange Commission, including the risk factors set forth in our Annual Report on Form 10-K for the year ended May 31, 2018, as the same may be updated from time to time. We do not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release.


CONSOLIDATED STATEMENTS OF INCOME    

IN THOUSANDS, EXCEPT PER SHARE DATA    

(Unaudited)    

 

     Three Months Ended  
     August 31,  
     2018     2017  

Net Sales

   $ 1,459,989     $ 1,345,394  

Cost of sales

     865,947       773,386  
  

 

 

   

 

 

 

Gross profit

     594,042       572,008  

Selling, general & administrative expenses

     459,742       394,409  

Restructuring charges

     20,076    

Interest expense

     24,406       26,773  

Investment (income), net

     (2,433     (4,453

Other expense (income), net

     313       (5
  

 

 

   

 

 

 

Income before income taxes

     91,938       155,284  

Provision for income taxes

     21,752       38,381  
  

 

 

   

 

 

 

Net income

     70,186       116,903  

Less: Net income attributable to noncontrolling interests

     422       487  
  

 

 

   

 

 

 

Net income attributable to RPM International Inc. Stockholders

   $ 69,764     $ 116,416  
  

 

 

   

 

 

 

Earnings per share of common stock attributable to RPM International Inc. Stockholders:

    

Basic

   $ 0.52     $ 0.87  
  

 

 

   

 

 

 

Diluted

   $ 0.52     $ 0.86  
  

 

 

   

 

 

 

Average shares of common stock outstanding - basic

     131,861       131,236  
  

 

 

   

 

 

 

Average shares of common stock outstanding - diluted

     136,430       135,720  
  

 

 

   

 

 

 


SUPPLEMENTAL SEGMENT INFORMATION

IN THOUSANDS

(Unaudited)

 

     Three Months Ended  
     August 31,  
     2018     2017  

Net Sales:

    

Industrial Segment

   $ 781,973     $ 729,768  

Consumer Segment

     485,196       427,144  

Specialty Segment

     192,820       188,482  
  

 

 

   

 

 

 

Total

   $ 1,459,989     $ 1,345,394  
  

 

 

   

 

 

 

Income Before Income Taxes:

    

Industrial Segment

    

Income Before Income Taxes (a)

   $ 69,057     $ 88,902  

Interest (Expense), Net (b)

     (2,393     (2,554
  

 

 

   

 

 

 

EBIT (c)

     71,450       91,456  

Inventory-related charges (d)

     4,477    

Restructuring charges (e)

     7,379    

Facility closure expense - other (f)

     2,440    

Receivable reserves (g)

     8,020    
  

 

 

   

 

 

 

Adjusted EBIT

   $ 93,766     $ 91,456  
  

 

 

   

 

 

 

Consumer Segment

    

Income Before Income Taxes (a)

   $ 51,296     $ 72,368  

Interest (Expense), Net (b)

     (165     (196
  

 

 

   

 

 

 

EBIT (c)

     51,461       72,564  

Inventory-related charges (d)

     (153  

Restructuring charges (e)

     1,551    

Facility closure expense - other (f)

     11    
  

 

 

   

 

 

 

Adjusted EBIT

   $ 52,870     $ 72,564  
  

 

 

   

 

 

 

Specialty Segment

    

Income Before Income Taxes (a)

   $ 27,801     $ 33,167  

Interest Income, Net (b)

     69       120  
  

 

 

   

 

 

 

EBIT (c)

     27,732       33,047  

Restructuring charges (e)

     2,147    

Facility closure expense - other (f)

     4    

ERP consolidation plan (h)

     659    
  

 

 

   

 

 

 

Adjusted EBIT

   $ 30,542     $ 33,047  
  

 

 

   

 

 

 

Corporate/Other

    

(Expense) Before Income Taxes (a)

   $ (56,216   $ (39,153

Interest (Expense), Net (b)

     (19,484     (19,690
  

 

 

   

 

 

 

EBIT (c)

     (36,732     (19,463

Restructuring charges (e)

     8,999    

Professional fees for negotiation of cooperation agreement (i)

     4,297    
  

 

 

   

 

 

 

Adjusted EBIT

   $ (23,436   $ (19,463
  

 

 

   

 

 

 

Consolidated

    

Income Before Income Taxes (a)

   $ 91,938     $ 155,284  

Interest (Expense), Net (b)

     (21,973     (22,320
  

 

 

   

 

 

 

EBIT (c)

     113,911       177,604  

Inventory-related charges (d)

     4,324    

Restructuring charges (e)

     20,076    

Facility closure expense - other (f)

     2,455    

Receivable reserves (g)

     8,020    

ERP consolidation plan (h)

     659    

Professional fees for negotiation of cooperation agreement (i)

     4,297    
  

 

 

   

 

 

 

Adjusted EBIT

   $ 153,742     $ 177,604  
  

 

 

   

 

 

 

 

(a)

The presentation includes a reconciliation of Income (Loss) Before Income Taxes, a measure defined by Generally Accepted Accounting Principles in the United States (GAAP), to EBIT and Adjusted EBIT.

(b)

Interest income (expense), net includes the combination of interest income (expense) and investment income (expense), net.

(c)

EBIT is defined as earnings (loss) before interest and taxes, with Adjusted EBIT provided for the purpose of adjusting for one-off items impacting revenues and/or expenses that are not considered by management to be indicative of ongoing operations. We evaluate the profit performance of our segments based on income before income taxes, but also look to EBIT as a performance evaluation measure because interest expense is essentially related to acquisitions, as opposed to segment operations. For that reason, we believe EBIT is also useful to investors as a metric in their investment decisions. EBIT should not be considered an alternative to, or more meaningful than, income before income taxes as determined in accordance with GAAP, since EBIT omits the impact of interest in determining operating performance, which represent items necessary to our continued operations, given our level of indebtedness. Nonetheless, EBIT is a key measure expected by and useful to our fixed income investors, rating agencies and the banking community all of whom believe, and we concur, that this measure is critical to the capital markets’ analysis of our segments’ core operating performance. We also evaluate EBIT because it is clear that movements in EBIT impact our ability to attract financing. Our underwriters and bankers consistently require inclusion of this measure in offering memoranda in conjunction with any debt underwriting or bank financing. EBIT may not be indicative of our historical operating results, nor is it meant to be predictive of potential future results.

(d)

Inventory-related charges reflect a true-up of prior inventory write-offs at our Consumer Segment and current period inventory write-offs and disposals at our Industrial Segment, all of which have been recorded in cost of goods sold during the first quarter of fiscal 2019 in connection with our restructuring activities.

(e)

Reflects restructuring charges, including headcount reductions, closures of facilities and accelerated vesting of equity awards in connection with key executives, all in relation to our 2020 Margin Acceleration Plan initiatives.

(f)

Includes accelerated depreciation expense related to the shortened useful lives of facilities currently operating, but are in the process of being prepared for closure.

(g)

Reflects the increase in our allowance for doubtful accounts deemed uncollectible as a result of a change in market and leadership strategy.

(h)

Includes implementation costs associated with the current phase of our ERP consolidation plan.

(i)

Comprises professional fees incurred in connection with the negotiation of a cooperation agreement. Refer to Form 8-K as filed on June 28, 2018.


SUPPLEMENTAL INFORMATION

RECONCILIATION OF “REPORTED” TO “ADJUSTED” AMOUNTS

(Unaudited)

 

     Three Months Ended  
     August 31,  
     2018      2017  

Reconciliation of Reported Earnings per Diluted Share to Adjusted Earnings per Diluted Share (All amounts presented after-tax):

     

Reported Earnings per Diluted Share

   $ 0.52      $ 0.86  

Inventory-related charges (d)

     0.03     

Restructuring charges (e)

     0.11     

Facility closure expense - other (f)

     0.01     

Receivable reserves (g)

     0.06     

ERP consolidation plan (h)

     0.01     

Professional fees for negotiation of cooperation agreement (i)

     0.02     
  

 

 

    

 

 

 

Adjusted Earnings per Diluted Share (j)

   $ 0.76      $ 0.86  
  

 

 

    

 

 

 

 

(d)

Inventory-related charges reflect a true-up of prior inventory write-offs at our Consumer Segment and current period inventory write-offs and disposals at our Industrial Segment, all of which have been recorded in cost of goods sold during the first quarter of fiscal 2019 in connection with our restructuring activities.

(e)

Reflects restructuring charges, including headcount reductions, closures of facilities and accelerated vesting of equity awards in connection with key executives, all in relation to our 2020 Margin Acceleration Plan initiatives.

(f)

Includes accelerated depreciation expense related to the shortened useful lives of facilities currently operating, but are in the process of being prepared for closure.

(g)

Reflects the increase in our allowance for doubtful accounts deemed uncollectible as a result of a change in market and leadership strategy.

(h)

Includes implementation costs associated with the current phase of our ERP consolidation plan.

(i)

Comprises professional fees incurred in connection with the negotiation of a cooperation agreement. Refer to Form 8-K as filed on June 28, 2018.

(j)

Adjusted EPS is provided for the purpose of adjusting diluted earnings per share for one-off items impacting revenues and/or expenses that are not considered by management to be indicative of ongoing operations.


CONSOLIDATED BALANCE SHEETS    

IN THOUSANDS    

(Unaudited)    

 

     August 31, 2018     August 31, 2017     May 31, 2018  

Assets

      

Current Assets

      

Cash and cash equivalents

   $ 202,183     $ 236,191     $ 244,422  

Trade accounts receivable

     1,126,184       1,060,147       1,160,162  

Allowance for doubtful accounts

     (55,558     (45,063     (46,344
  

 

 

   

 

 

   

 

 

 

Net trade accounts receivable

     1,070,626       1,015,084       1,113,818  

Inventories

     853,573       851,312       834,461  

Prepaid expenses and other current assets

     306,333       260,361       278,230  
  

 

 

   

 

 

   

 

 

 

Total current assets

     2,432,715       2,362,948       2,470,931  
  

 

 

   

 

 

   

 

 

 

Property, Plant and Equipment, at Cost

     1,589,312       1,526,565       1,575,875  

Allowance for depreciation

     (812,253     (770,692     (795,569
  

 

 

   

 

 

   

 

 

 

Property, plant and equipment, net

     777,059       755,873       780,306  
  

 

 

   

 

 

   

 

 

 

Other Assets

      

Goodwill

     1,187,705       1,169,083       1,192,174  

Other intangible assets, net of amortization

     585,056       587,274       584,272  

Deferred income taxes, non-current

     21,953       22,126       21,897  

Other

     218,904       211,612       222,242  
  

 

 

   

 

 

   

 

 

 

Total other assets

     2,013,618       1,990,095       2,020,585  
  

 

 

   

 

 

   

 

 

 

Total Assets

   $ 5,223,392     $ 5,108,916     $ 5,271,822  
  

 

 

   

 

 

   

 

 

 

Liabilities and Stockholders’ Equity

      

Current Liabilities

      

Accounts payable

   $ 500,913     $ 469,954     $ 592,281  

Current portion of long-term debt

     3,376       254,061       3,501  

Accrued compensation and benefits

     119,037       115,124       177,106  

Accrued losses

     30,295       26,406       22,132  

Other accrued liabilities

     224,515       229,602       211,706  
  

 

 

   

 

 

   

 

 

 

Total current liabilities

     878,136       1,095,147       1,006,726  
  

 

 

   

 

 

   

 

 

 

Long-Term Liabilities

      

Long-term debt, less current maturities

     2,267,159       1,868,229       2,170,643  

Other long-term liabilities

     360,074       491,677       356,892  

Deferred income taxes

     104,644       91,660       104,023  
  

 

 

   

 

 

   

 

 

 

Total long-term liabilities

     2,731,877       2,451,566       2,631,558  
  

 

 

   

 

 

   

 

 

 

Total liabilities

     3,610,013       3,546,713       3,638,284  
  

 

 

   

 

 

   

 

 

 

Commitments and contingencies

      

Stockholders’ Equity

      

Preferred stock; none issued

      

Common stock (outstanding 133,408; 133,537; 133,647)

     1,334       1,335       1,336  

Paid-in capital

     992,086       961,956       982,067  

Treasury stock, at cost

     (256,899     (223,567     (236,318

Accumulated other comprehensive (loss)

     (493,026     (429,382     (459,048

Retained earnings

     1,366,952       1,248,769       1,342,736  
  

 

 

   

 

 

   

 

 

 

Total RPM International Inc. stockholders’ equity

     1,610,447       1,559,111       1,630,773  

Noncontrolling interest

     2,932       3,092       2,765  
  

 

 

   

 

 

   

 

 

 

Total equity

     1,613,379       1,562,203       1,633,538  
  

 

 

   

 

 

   

 

 

 

Total Liabilities and Stockholders’ Equity

   $ 5,223,392     $ 5,108,916     $ 5,271,822  
  

 

 

   

 

 

   

 

 

 


CONSOLIDATED STATEMENTS OF CASH FLOWS

IN THOUSANDS    

(Unaudited)    

 

     Three Months Ended
August 31,
 
     2018     2017  

Cash Flows From Operating Activities:

    

Net income

   $ 70,186     $ 116,903  

Adjustments to reconcile net income to net cash provided by (used for) operating activities:

    

Depreciation

     24,068       19,893  

Amortization

     11,472       11,483  

Restructuring charges, net of payments

     7,084    

Deferred income taxes

     (561     9,815  

Stock-based compensation expense

     6,668       7,465  

Other non-cash interest expense

     775       1,422  

Realized loss (gain) on sales of marketable securities

     6       (2,861

Other

     992       (140

Changes in assets and liabilities, net of effect from purchases and sales of businesses:

    

Decrease in receivables

     32,389       1,646  

(Increase) in inventory

     (27,207     (46,771

(Increase) in prepaid expenses and other current and long-term assets

     (18,282     (10,865

(Decrease) in accounts payable

     (88,271     (72,688

(Decrease) in accrued compensation and benefits

     (56,747     (69,008

Increase (decrease) in accrued losses

     8,415       (5,765

Increase in other accrued liabilities

     20,857       20,147  

Other

     1,027       (6,765
  

 

 

   

 

 

 

Cash (Used For) Operating Activities

     (7,129     (26,089
  

 

 

   

 

 

 

Cash Flows From Investing Activities:

    

Capital expenditures

     (28,295     (17,533

Acquisition of businesses, net of cash acquired

     (26,366     (36,169

Purchase of marketable securities

     (12,695     (56,275

Proceeds from sales of marketable securities

     9,758       40,792  

Other

     (2,881     702  
  

 

 

   

 

 

 

Cash (Used For) Investing Activities

     (60,479     (68,483
  

 

 

   

 

 

 

Cash Flows From Financing Activities:

    

Additions to long-term and short-term debt

     120,702       19,125  

Reductions of long-term and short-term debt

     (21,952     (760

Cash dividends

     (42,714     (40,089

Shares of common stock repurchased and shares returned for taxes

     (20,581     (5,346

Payments of acquisition-related contingent consideration

     (3,456     (3,258

Other

     (320     (747
  

 

 

   

 

 

 

Cash Provided By (Used For) Financing Activities

     31,679       (31,075
  

 

 

   

 

 

 

Effect of Exchange Rate Changes on Cash and

    

Cash Equivalents

     (6,310     11,341  
  

 

 

   

 

 

 

Net Change in Cash and Cash Equivalents

     (42,239     (114,306

Cash and Cash Equivalents at Beginning of Period

     244,422       350,497  
  

 

 

   

 

 

 

Cash and Cash Equivalents at End of Period

   $ 202,183     $ 236,191