UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
(mark one)
X Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended November 29, 1997
OR
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the transition period from ____________ to ____________
Commission file number: 000-04892
CAL-MAINE FOODS, INC.
(Exact name of registrant as specified in its charter)
Delaware 64-0500378
(State or other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
3320 Woodrow Wilson Avenue, Jackson, Mississippi 39209
(Address of principal executive offices) (Zip Code)
(601) 948-6813
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No_____
Number of shares outstanding of each of the issuer's classes of common stock
(exclusive of treasury shares), as of January 5, 1998.
Common Stock, $0.01 par value 11,994,388 shares
Class A Common Stock, $0.01 par value 1,200,000 shares
CAL-MAINE FOODS, INC.
INDEX
Page
Part I. Financial Information Number
Item 1. Condensed Consolidated Financial Statements
Condensed Consolidated Balance Sheets -
November 29, 1997 and May 31, 1997 3
Condensed Consolidated Statements of Operations -
Three Months and Six Months Ended
November 29, 1997 and November 30, 1996 4
Condensed Consolidated Statements of Cash Flow -
Six Months Ended November 29, 1997 and
November 30, 1996 5
Notes to Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 7
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 13
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CAL-MAINE FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
November 29, 1997 May 31, 1997
----------------- ------------
(unaudited) (note)
ASSETS
Current assets:
Cash and cash equivalents $ 20,939 $ 23,737
Accounts receivable, net 24,303 13,086
Recoverable federal and state income taxes 162 1,137
Inventories - note 2 44,159 42,594
Prepaid expenses and other current assets 450 986
--------- ---------
Total current assets 90,013 81,540
Notes receivable and investments 5,013 4,747
Other assets 830 661
Property, plant and equipment 170,794 161,117
Less accumulated depreciation (71,151) (65,771)
--------- ---------
99,643 95,346
--------- ---------
TOTAL ASSETS $ 195,499 $ 182,294
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 31,047 $ 21,695
Current maturities of long-term debt 5,067 4,540
Current deferred income taxes 9,915 9,915
--------- ---------
Total current liabilities 46,029 36,150
Long-term debt, less current maturities 60,715 59,896
Deferred expenses 1,655 1,655
Deferred income taxes 9,951 9,951
--------- ---------
Total liabilities 118,350 107,652
Stockholders' equity:
Common stock $0.01 par value per share:
Authorized shares - 30,000,000
Issued and outstanding shares -
17,565,200 at November 30,
1997 and May 31, 1997 176 176
Class A common stock $0.01 par value,
authorized and issued
1,200,000 shares 12 12
Paid-in capital 18,784 18,785
Retained earnings 64,410 61,903
Common stock in treasury - 5,570,812
shares at November 30, 1997 and
5,583,200 shares at May 31, 1997 (6,233) (6,234)
--------- ---------
Total stockholders' equity 77,149 74,642
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 195,499 $ 182,294
========= =========
See note next page. See notes to condensed consolidated financial statements.
CAL-MAINE FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
UNAUDITED
13 Weeks Ended 26 Weeks Ended
Nov 29, 1997 Nov 30, 1996 Nov 29, 1997 Nov 30, 1996
------------ ------------ ------------ ------------
Net sales $ 79,435 $ 78,629 $ 143,158 $ 144,192
Cost of sales 63,999 60,783 122,252 116,495
--------- --------- --------- ---------
Gross profit 15,436 17,846 20,906 27,697
Selling, general and
administrative 8,122 7,102 15,583 14,242
--------- --------- --------- ---------
Operating income 7,314 10,744 5,323 13,455
Other income (expense):
Interest expense, net (858) (1,182) (1,700) (2,089)
Other 232 200 255 190
--------- --------- --------- ---------
(626) (982) (1,445) (1,899)
--------- --------- --------- ---------
Income before income taxes 6,688 9,762 3,878 11,556
Income tax expense 2,444 3,831 1,371 4,528
--------- --------- --------- ---------
NET INCOME $ 4,244 $ 5,931 $ 2,507 $ 7,028
========= ========= ========= =========
Net income/common share $ 0.32 $ 0.52 $ .19 $ 0.61
========= ========= ========= =========
Weighted average shares
outstanding 13,194 11,502 13,191 11,507
========= ========= ========= =========
Note: The balance sheet at May 31, 1997 has been derived from the audited
financial statements at that date but does not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial statements.
See notes to condensed consolidated financial statements.
CAL-MAINE FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
UNAUDITED
26 Weeks Ended
Nov 29, 1997 Nov 30, 1996
------------ ------------
Cash flows from operating activities $ 6,198 $ 12,920
Cash flows from investing activities:
Purchases of property, plant and equipment (4,022) (2,356)
Construction of production facilities (4,345) (3,162)
Purchases of shell egg production and
processing business (2,037) 0
Payments received on notes receivable and
from investments 62 34
Increase in note receivable, investments and
other assets (469) 0
Net proceeds from sale of property, plant and
equipment 469 274
--------- ---------
Net cash used in investing activities (10,342) (5,210)
Cash flows from financing activities:
Additional long-term borrowings 9,000 1,000
Principal payments on long-term debt and
capital leases (7,654) (3,590)
Purchases of common stock for treasury (78) (42)
Sale of common stock from treasury 79 0
Redemption of fractional shares of common stock (1) (4)
--------- ---------
Net cash provided by (used in) financing activities 1,346 (2,636)
--------- ---------
Increase (decrease) in cash and cash equivalents (2,798) 5,074
Cash and cash equivalents at beginning of period 23,737 3,959
--------- ---------
Cash and cash equivalents at end of period $ 20,939 $ 9,033
See notes to condensed consolidated financial statements.
CAL-MAINE FOODS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(in thousands, except share amounts)
November 29, 1997
(unaudited)
1. Presentation of Interim Information
The accompanying unaudited condensed consolidated financial statements are
presented in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
Article 10 of regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements.
In the opinion of the management of Cal-Maine Foods, Inc. (the "Company"),
the accompanying unaudited condensed consolidated financial statements include
all normal adjustments considered necessary to present fairly the financial
position as of November 29, 1997, and the results of operations for the thirteen
and twenty-six weeks ended November 29, 1997 and November 30, 1996, and the
cash flows for the twenty-six weeks ended November 29, 1997 and November 30,
1996. Interim results are not necessarily indicative of results for a full
year. For further information, refer to the consolidated financial statements
and footnotes thereto included in the Company's Annual Report.
2. Acquisitions
In November 1997, the Company purchased the inventories and equipment of a
shell egg production and processing business for $2,037 and accounted for the
transaction as a purchase. In connection with the purchase, the Company leased
substantially all facilities of the business under operating leases with monthly
rentals of $22 through October 2004, with options to renew the leases for
five one-year terms. The operating results of these assets acquired are
included in the consolidated statements of the Company for the period
subsequent to the acquisition date.
3. Inventories
Inventories consisted of the following:
Nov 29, 1997 May 31, 1997
------------ ------------
Flocks $ 27,790 $ 26,674
Eggs and egg products 4,288 4,030
Feed and supplies 8,982 8,377
Livestock 3,099 3,513
-------- --------
$ 44,159 $ 42,594
4. Impact of Recently Issued Accounting Standards
In February 1997, the Financial Accounting Standards Board issued Statement
No. 128, "Earnings per Share", which is required to be adopted on February 28,
1998. At that time, the Company will be required to change the method
currently used to compute earnings per share and to restate all prior periods.
Under the new requirements for calculating primary earnings per share, the
dilutive effects of stock options will be excluded. The impact of Statement 128
on the calculation of primary and fully diluted earnings per share for the three
and six months ended November 29, 1997 and November 30, 1996 is not expected
to be material.
5. Subsequent Events
In December 1997, the Company and three of its lenders agreed to revised
terms, amounts and interest rates for long-term debt extended to the Company.
The revised arrangements provide for a total of $40 million of borrowings under
notes, with maturities ranging from 10 to 15 years at a weighted average fixed
interest rate of 7.10%. Approximately $20 million of existing debt was
refinanced and the Company was provided with an additional $20 million of
working capital.
ITEM 2. MANAGEMENTS'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
OVERVIEW
The Company is primarily engaged in the production, cleaning, grading,
packing and sale of fresh shell eggs and in the manufacture and sale of egg
products. The Company's fiscal year end is the Saturday closest to May 31.
The Company's operations are fully integrated. It owns facilities to
hatch chicks, grow pullets, manufacture feed, and produce, process,
manufacture and distribute shell eggs and egg products. The Company currently
is the largest producer and distributor of fresh shell eggs in the United
States. Shell eggs account for over 90% of the Company's net sales. The
Company primarily markets its shell eggs in the southwestern, southeastern,
mid-western and mid-Atlantic regions of the United States. Shell eggs are
sold directly by the Company primarily to national and regional supermarket
chains. Egg products are sold both on a direct basis and through egg product
brokers to institutional users, including manufacturers of baked goods,
mayonnaise and confections.
The Company currently uses contract producers for approximately 33% of its
total egg production. Contract producers operate under agreements with the
Company for the use of their facilities in the production of shell eggs by
layers owned by the Company, which owns the eggs produced. Also, some shell
eggs are purchased for resale by the Company from other, outside producers.
The Company's operating income or loss is significantly affected by wholesale
shell egg market prices, which can fluctuate widely and are outside of the
Company's control. Retail sales of shell eggs are greatest during the fall and
winter months and lowest during the summer months. Prices for shell eggs
fluctuate in response to seasonal factors and a natural increase in egg
production during the spring and early summer.
The Company's cost of production is materially affected by feed costs,
which average about 60% of Cal-Maine's total farm egg production cost. Changes
in feed costs result in changes in the Company's cost of goods sold. The cost
of feed ingredients is affected by a number of supply and demand factors such
as crop production and weather, and other factors, such as the level of grain
exports, over which the Company has little or no control.
Management's discussion contains forward-looking statements which involve
risks and uncertainties and the Company's actual experience may differ
materially from that discussed as follows. Factors that may cause such a
difference include, but are not limited to, those discussed in "Factors
Affecting Future Performance", below, as well as future events
that have the effect of reducing the Company's available cash balances, such
as unanticipated operating losses or capital expenditures related to possible
future acquisitions. Readers are cautioned not to place undue reliance on
forward-looking statements, which reflect management's analysis only as the
date hereof. The Company assumes no obligation to update forward-looking
statements. See also the Company's report to be filed from time to time with
the Securities and Exchange Commission pursuant to the Securities Exchange
Act of 1934.
Factors Affecting Future Performance. The Company's future operating results
may be affected by various trends and factors which are beyond the Company's
control. These include adverse changes in shell egg prices and in the grain
market. Accordingly, past trends should not be used to anticipate future
results and trends. Further, the Company's prior performance should not be
presumed to be an accurate indication of future performance.
RESULTS OF OPERATIONS
The following table sets forth, for the periods indicated, certain items from
the Company's Condensed Consolidated Statements of Income expressed as a
percentage of net sales.
Percentage of Net Sales
13 Weeks Ended 26 Weeks Ended
Nov 29, 1997 Nov 30, 1996 Nov 29, 1997 Nov 30, 1996
------------ ------------ ------------ ------------
Net sales 100.0% 100.0% 100.0% 100.0%
Cost of sales 80.6 77.3 85.4 80.8
------ ------ ------ ------
Gross profit 19.4 22.7 14.6 19.2
Selling, general &
administrative 10.2 9.0 10.9 9.9
------ ------ ------ ------
Operating income 9.2 13.7 3.7 9.3
Other expense (.8) (1.3) (1.0) (1.3)
------ ------ ------ ------
Income before taxes 8.4 12.4 2.7 8.0
Income tax expense 3.1 4.9 1.0 3.1
------ ------ ------ ------
Net income 5.3% 7.5% 1.7% 4.9%
====== ====== ====== ======
NET SALES
Net sales for the second quarter of fiscal 1998 were $79.4 million, an
increase of approximately $806,000, or 1.0%, as compared to net sales for the
second quarter of fiscal 1997. This increase is the net result of an increase
in dozens sold and a decrease in price per dozen sold. For the current quarter,
103.3 million dozens were sold as compared to 95.4 million dozens for the
second quarter last year, an increase of 7.9 million dozens or 8.3%. Purchases
from outside producers accounted for just over half of the increase in the
number of dozens sold. For the current quarter, the Company's net average
selling price per dozen was $.706, compared to $.772 per dozen for the
comparable quarter last year, a decrease of $.066 per dozen or 8.5%. The
selling price decrease is due to increased production and egg supply within the
industry and lower export sales. Average large shell egg market prices
decreased approximately $.073 per dozen for the current quarter as compared to
last year's quarter. On November 1, 1997, the beginning of the last month of
the current fiscal quarter, the Company purchased and leased assets of a
production, processing and marketing operation in Georgia. The operation also
sells feed to egg producers in the area. For the one month, that location
accounted for 2.8% of the dozens sold in the current quarter and had feed
sales of $2.1 million to outside egg producers.
Net sales for the twenty-six weeks ended November 29, 1997 were $143.2
million, a decrease over last year of $1.0 million, or .7%. Although dozens
sold increased for the current year, lower shell egg market prices for the
period resulted in a decrease in net sales as compared to last year. Dozens
sold for the current twenty-six week period were 201.4 million as compared to
184.8 million for last year, an increase of 9%. The increase in dozens sold was
provided equally by increased Company production and purchases from outside
producers. For the current period, the Company's net average selling price
per dozen was $.658 per dozen, compared to $.728 per dozen last year, a decrease
of $.07 per dozen or 9.6%. Average large shell egg market prices decreased
approximately $.075 per dozen for the current year as compared to last year's
twenty-six week period. As discussed above, increased egg supply is the primary
cause of reduced egg market prices.
COST OF SALES
Total cost of sales for the second quarter ended November 29, 1997 was $64
million, an increase of $3.2 million, or 5.3%, over a cost of sales of $60.8
million for the comparable period last year. This increase is primarily the
result of an increase in dozens sold. For the current quarter compared to
last year, cost of feed per dozen eggs decreased and, due to lower shell egg
market prices, cost per dozen of outside eggs purchased decreased. Feed cost
per dozen for the second quarter ended November 29, 1997, was $.266 as
compared to the cost per dozen of $.278 for the second quarter last year, a
decrease of 4.3%. Anticipation of and an actual good 1997 harvest of corn
and soybeans kept the cost of feed ingredients in the moderate range. The
decrease in egg selling prices resulted in a decrease of gross profit from 22.7%
of net sales in the quarter ended November 30, 1996 to 19.4% for the current
quarter ended November 29, 1997.
For the twenty-six week period ended November 29, 1997, total cost of sales
was $122.2 million, an increase of $5.7 million, or 4.9%, over a cost of sales
of $116.5 million for last year. As in the current quarter above, the increase
is primarily the result of an increase in dozens sold, even though the cost of
feed per dozen eggs decreased, and cost per dozen of outside eggs purchased
decreased. Feed cost per dozen for the current year was $.258, a decrease of
$.042 per dozen, or 14%, as compared to last year's cost per dozen of $.30.
Last year's higher cost of feed ingredients was the result of poor crop
conditions, as compared to a better crop and lower cost of feed ingredients this
year. Although egg production and purchase costs improved and dozens sold
increased for the current twenty-six week period, the decrease in egg selling
prices resulted in a decrease in gross profit. For the current year, gross
profit was 14.6% of net sales, as compared to 19.2% for last year.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative expense for the second quarter ended
November 29, 1997 was $8.1 million, an increase of $1.0 million, or 14.4%, as
compared to the $7.1 million for the comparable period last year. Approximately
one half of the current increase was for development costs associated with the
specialty egg business. Recently, the Company effected certain business
acquisitions and expanded markets for specialty eggs in New York City and
existing markets. The balance of the increase was made up of higher expenses
for more customer delivery volume and higher costs in legal and professional
fees. As a percent of net sales, selling, general and administrative expenses
have increased from 9% for the second quarter last year to 10.2% for the
current quarter.
For the twenty-six weeks ended November 29, 1997, selling, general and
administrative expense was $15.6 million, an increase of $1.4 million, or
9.4%, as compared to $14.2 million for the same period last year. Approximately
one half of the increased cost was due to higher customer delivery expenses
associated with a higher sales volume. The balance of the increase was in
specialty egg market development costs and in legal and professional fees. As a
percent of net sales, selling, general and administrative expense was 10.9%
for the current twenty-six weeks, as compared to 9.9% for last year.
OPERATING INCOME
As the result of the above, operating income was $7.3 million for the second
quarter ended November 29, 1997, as compared to $10.7 million for last year's
comparable quarter. As a percent of net sales, the fiscal 1998 quarter had a
9.2% operating profit, compared to 13.7% for last year.
For the twenty-six weeks ended November 29, 1997, operating income was $5.3
million, compared to $13.5 million for last year. As a percent of net sales,
operating income was 3.7% for the current year, as compared to 9.3% for last
year.
OTHER EXPENSE
Other expense for the second quarter ended November 29, 1997 was $626,000, a
reduction of $356,000, or 36.3%, as compared to the second quarter last year.
The current year reduction is the result of increased interest income from cash
investments and an increase in interest capitalized on construction projects.
As a percent of net sales, other expense decreased from 1.3% last year to .8%
for the current quarter.
For the twenty-six weeks ended November 29, 1997, other expense was $1.4
million, a decrease of approximately $500,000, or 23.9%, as compared to $1.9
million for last year's comparable period. As explained for the quarter above,
higher interest income and capitalized interest were the reasons for the
decrease. As a percent of net sales, other expense for this year was 1%, as
compared to 1.3% last year.
INCOME TAXES
As a result of the above, the Company's pre-tax income was $6.7 million for
the quarter ended November 29, 1997, compared to pre-tax income of $9.8
million for last year's quarter. For the current quarter, an income tax expense
of $2.4 million was recorded with an effective tax rate of 36.5%, as compared to
an income tax expense of $3.8 million with and effective rate of 39.2% for
last year's comparable quarter.
The Company's pre-tax income for the twenty-six week period ended November
29, 1997 was $3.9 million, compared to $11.6 million for last year. For the
current twenty-six week period, an income tax expense of $1.4 million was
recorded with an effective rate of 35.4%, as compared to an income tax expense
of $4.5 million with an effective rate of 39.2% for last year's comparable
period.
The Company's lower effective rate for the current quarter and year-to-date,
as compared to last year's effective rate, is due primarily to an increase in
tax exempt interest income as a percent of pre tax income during the current
year as compared to the prior year.
NET INCOME
Net income for the second quarter ended November 29, 1997 was $4.2 million,
or $.32 per share, compared to net income of $5.9 million, or $.52 per share
for last year's second quarter.
For the twenty-six week period ended November 29, 1997, net income was $2.5
million, or $.19 per share, compared to last year's net income of $7.0 million,
or $.61 per share.
CAPITAL RESOURCES AND LIQUIDITY
The Company's working capital at November 29, 1997 was $44.0 million,
compared to $45.4 million at May 31, 1997. The Company's need for working
capital generally is highest in the first and last fiscal quarters ending in
August and May, respectively, when egg prices are normally at seasonal lows.
Seasonal borrowing needs frequently are higher during these periods than
during other fiscal periods. The Company had an unused $35 million line of
credit with three banks at November 29, 1997. The Company's long-term debt
at that date, including current maturities and capitalized lease obligations,
totaled $65.8 million.
In December 1997, the Company and three of its lenders agreed to revised
terms, amounts and interest rates for long-term debt extended to the Company.
The revised arrangements provide for a total of $40 million of borrowings under
notes, with maturities ranging from 10 to 15 years at a weighted average fixed
interest rate of 7.10%. Approximately $20 million of existing debt was
refinanced and the Company was provided with an additional $20 million of
working capital.
Substantially all trade receivables collateralize the Company's line of
credit, and property, plant and equipment collateralize the Company's long-
term debt. The Company is required by certain provisions of these loan
agreements to (1) maintain minimum levels of working capital and net worth;
(2) limit dividends, capital expenditures, lease obligations and additional
long-term borrowings; and (3) maintain various current and cash-flow coverage
ratios, among other restrictions. The Company was in compliance with these
provisions at November 29, 1997.
For the twenty-six weeks ended November 29, 1997, $6.2 million in net cash
was provided by operating activities. This compares to net cash from operating
activities of $12.9 million for the comparable period last year. For the
current twenty-six week period, additional long-term borrowings of $9.0 million
were received from available borrowings of industrial revenue bonds for the
construction of a shell egg production and processing facility in Chase, Kansas.
During this current period, $4.3 million was expended for construction of the
Chase facility and $4.0 million was used for purchases of property, plant and
equipment. In November, $2.0 million was used to purchase the inventories and
rolling stock of a shell egg production, processing and distribution business.
In addition, principal payments of $7.6 million were made on long-term debt
and capital leases. The net result of these activities was a decrease in cash
and equivalents of $2.8 million.
For the comparable twenty-six week period last year, $12.9 million cash was
provided by operating activities, and long-term borrowings, through the
industrial revenue bonds, were received for $1.0 million. For the period last
year, $3.1 million was used for construction, $2.4 million was used for
purchases of property, plant and equipment, and $3.6 million was used for
repayment of long-term debt and capital leases. The net result was an increase
in cash and equivalents of $5.1 million.
At November 29, 1997, the Company had expended, since the start of the
project, approximately $15.4 million in the construction of the Chase facility.
The Company is financing approximately $13.5 million of the estimated $16.0
million to complete the project through industrial revenue bonds maturing in
2011. Borrowings under the industrial revenue bond agreement totaled $10.0
million at November 29, 1997. Late in the current quarter, the Company began
site preparation for construction of new shell egg production and processing
facilities in Waelder, Texas. The estimated cost of construction is
approximately $13.9 million with financing plans of approximately $10.4 million
in borrowings from an insurance company.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits
The following Part I exhibit is filed herewith:
Exhibit
Number Exhibit
------- -------
10.10 Note Purchase Agreement, dated December 18, 1997, among
Cal-Maine Foods, Inc., Cal-Maine Farms, Inc., Cal-Maine
Egg Products, Inc., Cal-Maine Partnership, LTD, CMF of
Kansas-LLC and First South Production Credit Association
and Metropolitan Life Insurance Company (without exhibits,
except names of guarantors and forms of notes)
27 Financial data schedule
b. Reports on Form 8-K
No Current Report on Form 8-K was filed by the Company covering an event during
the second quarter of fiscal 1998.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
CAL-MAINE FOODS, INC.
(Registrant)
Date: January 7, 1997 /s/Bobby J. Raines
---------------------
Bobby J. Raines
Vice President/Treasurer
(Principal Financial Officer)
Date: January 7, 1997 /s/Charles F. Collins
---------------------
Charles F. Collins
Vice President/Controller
(Principal Accounting Officer)