SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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 June 28, 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 No. 1-4663
Crompton & Knowles Corporation
(exact name of registrant as specified in its charter)
Massachusetts 04-1218720
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Station Place, Metro Center
Stamford, Connecticut 06902
(address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (203)353-5400
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
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.
Class Outstanding at July 16, 1997
Common Stock, $.10 par value 73,492,512 shares
CROMPTON & KNOWLES CORPORATION
FORM 10-Q
FOR QUARTER ENDED JUNE 28, 1997
INDEX
PART I. FINANCIAL INFORMATION:
Item 1. Condensed Financial Statements and
Accompanying Notes
. Consolidated Statements of Earnings
(unaudited) - Quarters and six months ended
June 28, 1997 and June 29, 1996
. Consolidated Balance Sheets - June 28, 1997
(unaudited) and December 28, 1996
. Consolidated Statements of Cash Flows
(unaudited) - Six months ended
June 28, 1997 and June 29, 1996
. Notes to Consolidated Financial
Statements - Quarter ended June 28, 1997
(unaudited)
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
PART II. OTHER INFORMATION:
Item 1. Legal Proceedings
Item 6. Exhibits and Reports on Form 8-K
Signatures
*Exhibit 4 $600,000,000 Second Amended and Restated
Credit Agreement
Exhibit 11 Statement Re Computation of Per Share Earnings
*Exhibit 27 Financial Data Schedule
* A copy of this Exhibit is annexed to this report on Form 10-Q
provided to the Securities and Exchange Commission and the New
York Stock Exchange.
-1-
UNAUDITED
CROMPTON & KNOWLES CORPORATION AND SUBSIDIARIES
Consolidated Statements of Earnings
Quarters and six months ended June 28, 1997 and June 29, 1996
(In thousands, except per share data)
Quarters ended Six months ended
June 28, June 29, June 28, June 29,
1997 1996 1997 1996
Net sales $ 494,142 $ 469,633 $ 968,015 $ 930,101
Cost of products sold 312,638 295,668 617,010 590,207
Selling, general and administrative 69,767 71,104 136,439 139,717
Depreciation and amortization 20,300 21,757 40,153 42,348
Research and development 13,054 13,140 25,938 26,073
Operating profit 78,383 67,964 148,475 131,756
Interest 26,581 29,035 53,534 58,026
Other expense(income) 583 (599) 781 (279)
Earnings before income
taxes and extraordinary loss 51,219 39,528 94,160 74,009
Income taxes 19,451 15,152 35,781 28,479
Earnings before
extraordinary loss 31,768 24,376 58,379 45,530
Extraordinary loss on early
extinguishment of debt (1,227) (441) (1,227) (441)
Net earnings $ 30,541 $ 23,935 $ 57,152 $ 45,089
Per common share:
Earnings before
extraordinary loss $ .42 $ .34 $ .77 $ .63
Extraordinary loss (.02) - (.02) -
Net earnings $ .40 $ .34 $ .75 $ .63
Dividends per common share $ .05 $ .135 $ .05 $ .27
Average shares outstanding 76,195 72,166 76,197 72,142
See accompanying notes to consolidated financial statements.
- 2 -
June 28, 1997 UNAUDITED
CROMPTON & KNOWLES CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
June 28, 1997 and December 28, 1996
(In thousands of dollars)
June 28, December 28,
1997 1996
ASSETS
CURRENT ASSETS
Cash $ 28,637 $ 21,120
Accounts receivable 291,765 267,871
Inventories 362,149 362,349
Other current assets 86,032 90,897
Total current assets 768,583 742,237
NON-CURRENT ASSETS
Property, plant and equipment 476,768 497,979
Cost in excess of acquired net assets 184,484 189,012
Other assets 205,301 227,962
$ 1,635,136 $ 1,657,190
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current installments of long-term debt $ -- $ 731
Notes payable 2,973 8,595
Accounts payable 140,950 151,270
Accrued expenses 145,130 143,133
Income taxes payable 41,580 33,214
Other current liabilities 24,446 20,536
Total current liabilities 355,079 357,479
NON-CURRENT LIABILITIES
Long-term debt 993,237 1,054,982
Accrued postretirement liability 181,220 181,980
Other liabilities 155,259 159,167
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock 7,733 7,724
Additional paid-in capital 229,362 232,010
Accumulated deficit (203,688) (257,177)
Accumulated translation adjustment (36,831) (25,592)
Treasury stock at cost (42,190) (48,083)
Deferred compensation (1,285) (1,587)
Pension liability adjustment (2,760) (3,713)
Total stockholders' deficit (49,659) (96,418)
$ 1,635,136 $ 1,657,190
See accompanying notes to consolidated financial statements.
- 3 -
UNAUDITED
CROMPTON & KNOWLES CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
Six months ended June 28, 1997 and June 29, 1996
(In thousands of dollars)
June 28, June 29,
Increase (decrease) to cash 1997 1996
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings $ 57,152 $ 45,089
Adjustments to reconcile net earnings
to net cash provided by operations:
Depreciation and amortization 40,153 42,348
Noncash interest 6,946 8,362
Deferred taxes 12,009 5,760
Changes in assets and liabilities, net (20,699) (24,043)
Net cash provided by operations 95,561 77,516
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions -- (15,713)
Capital expenditures (17,040) (19,492)
Other investing activities 2,535 (3,478)
Net cash used by investing activities (14,505) (38,683)
CASH FLOWS FROM FINANCING ACTIVITIES
Payments on long-term borrowings (67,241) (14,840)
Proceeds (payments) on short-term borrowings (5,157) 8,524
Dividends paid (3,663) (12,967)
Other financing activities 3,053 397
Net cash used by financing activities (73,008) (18,886)
CASH
Effect of exchange rates on cash (531) (1,796)
Change in cash 7,517 18,151
Cash at beginning of period 21,120 16,961
Cash at end of period $ 28,637 $ 35,112
See accompanying notes to consolidated financial statements.
-4-
CROMPTON & KNOWLES CORPORATION AND SUBSIDIARIES
Notes to Unaudited Consolidated Financial Statements
Quarter ended June 28, 1997
PRESENTATION OF CONSOLIDATED FINANCIAL STATEMENTS
The information included in the foregoing consolidated financial
statements is unaudited but reflects all adjustments (consisting
only of normal recurring adjustments) which are, in the opinion
of management, necessary for a fair statement of the results for
the interim periods presented.
Included in accounts receivable are allowances for doubtful
accounts of $8.5 million in 1997 and $7.3 million at December 28,
1996.
Accumulated depreciation amounted to $398.3 million in 1997 and
$375.7 million at December 28, 1996.
Accumulated amortization of cost in excess of acquired net assets
amounted to $39.4 million in 1997 and $36.6 million at December
28, 1996.
Accumulated amortization of patents, unpatented technology and
other intangibles amounted to $115.6 million in 1997 and $108.2
million at December 28, 1996.
Cash payments during the six months ended June 28, 1997 and June
29, 1996 included interest of $46.9 million and $52.1 million,
respectively, and income taxes of $16.2 million and $16.4
million, respectively.
It is suggested that the interim consolidated financial
statements be read in conjunction with the consolidated financial
statements and notes included in the Company's 1996 Annual Report
on Form 10-K.
CAPITAL STOCK
As of June 28, 1997, there were 77,332,751 common shares issued
at $.10 par value, of which 3,851,241 shares were held in the
treasury.
INVENTORIES
Components of inventories are as follows:
June 28, Dec. 28,
(In thousands) 1997 1996
Finished goods $240,928 $242,587
Work in process 45,225 44,445
Raw materials and supplies 75,996 75,317
$362,149 $362,349
EARNINGS PER COMMON SHARE
The computations of earnings per common share for the quarters
and six months ended June 28, 1997 and June 29, 1996 are based on
the weighted average number of common shares outstanding and
common stock equivalents. A dual presentation of earnings per
common share has not been made since there is no significant
difference in earnings per share calculated on a primary or fully
diluted basis.
ACCOUNTING STANDARD CHANGE
In February 1997 the Financial Accounting Standards Board issued
Statement No.128 "Earnings per Share" which will require the
Company to report both basic earnings per common share and
diluted earnings per common share after December 15, 1997. Based
on preliminary analysis, the Company does not expect the adoption
of Statement No.128 to be materially different from earnings per
common share for periods presented herein.
BUSINESS SEGMENT DATA
Quarter Ended
June 28, June 29,
(In thousands) 1997 1996
SALES
Specialty Chemicals $ 418,303 $ 398,998
Specialty Equipment and Controls 75,839 70,635
Total net sales $ 494,142 $ 469,633
OPERATING PROFIT
Specialty Chemicals $ 76,074 $ 66,845
Specialty Equipment and Controls 8,122 6,395
General corporate expense ( 5,813) ( 5,276)
Total operating profit $ 78,383 $ 67,964
Six Months Ended
June 28, June 29,
(In thousands) 1997 1996
SALES
Specialty Chemicals $ 817,009 $ 790,709
Specialty Equipment and Controls 151,006 139,392
Total net sales $ 968,015 $ 930,101
OPERATING PROFIT
Specialty Chemicals $ 144,632 $ 129,415
Specialty Equipment and Controls 15,748 13,501
General corporate expense ( 11,905) ( 11,160)
Total operating profit $ 148,475 $ 131,756
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
SECOND QUARTER RESULTS
Overview
Consolidated net sales of $494.1 million for the second quarter
of 1997 increased 5% from the comparable 1996 period. The
increase was primarily attributable to higher unit volume of 7%
offset by lower pricing (1%) and lower foreign currency
translation (1%). International sales, including U.S. exports,
were 39% of total sales unchanged from the second quarter of
1996. Net earnings before extraordinary losses on early
extinguishment of debt increased 30% to $31.8 million, or $.42
per common share, compared to $24.4 million, or $.34 per common
share, in the second quarter of 1996. Net earnings including
extraordinary losses on early extinguishment of debt were $30.5
million, or $.40 per common share, compared to $23.9 million, or
$.34 per common share, in 1996.
Gross margin as a percentage of net sales decreased slightly to
36.7% from 37.0% in the second quarter of 1996. Consolidated
operating profit increased 15% to $78.4 million as the specialty
chemicals segment rose 14% and the specialty process equipment
and controls segment increased 27%.
Specialty Chemicals
The Company's specialty chemicals segment reported sales of
$418.3 million representing a 5% increase from the comparable
1996 period. The increase resulted from improved unit volume of
7% offset equally by lower pricing and lower foreign currency
translation. An analysis of sales by major product class within
the specialty chemicals segment follows.
Chemicals and polymers sales of $126.1 million rose 1% from the
second quarter of 1996. Unit volume was higher by 7% but was
offset in part by lower pricing of 5% and lower foreign currency
translation of 1%. Sales of rubber chemicals were lower than
1996 primarily due to lower pricing. EPDM and nitrile rubber
sales increased primarily as a result of higher unit volume.
Crop protection sales of $115.1 million were 10% higher versus
the second quarter of 1996 primarily attributable to higher unit
volume. Sales increases for miticides in the U.S. and strong
demand for insecticides and fungicides worldwide contributed to
the improvement.
Specialty sales of $82.2 million increased 12% from the 1996
second quarter primarily due to increased unit volume for
lubricant and plastics additives, polymerization inhibitors and
urethane prepolymers.
Colors sales of $69.2 million declined 2% from the comparable
1996 quarter. Increased unit volume of 3% (primarily from
European dyes) was more than offset by lower foreign currency
translation of 3% and lower selling prices of 2%.
Specialty ingredients sales of $25.7 million were 3% lower than
the second quarter of 1996 primarily attributable to lower unit
volume as a result of product line rationalization.
Operating profit of $76.1 million for the second quarter of 1997
increased 14% versus the second quarter of 1996. The improvement
in operating profit resulted primarily from an increase in unit
volume and lower operating costs.
Specialty Process Equipment and Controls
The Company's specialty process equipment and controls segment
reported sales of $75.8 million, representing a 7% increase from
the second quarter of 1996. Approximately 8% was attributable
to higher unit volume and 1% to higher pricing offset in part by
lower foreign currency translation of 2%. Sales growth was
achieved primarily in the automotive, construction and packaging
materials markets.
Operating profit for the second quarter of 1997 of $8.1 million
increased 27%, primarily attributable to higher unit volume and
pricing. The order backlog for extruders and related equipment
at the end of the second quarter of 1997 amounted to $103
million compared to $92 million at the end of 1996.
Other
Selling, general and administrative expenses of $69.8 million
decreased 2% primarily due to planned cost reductions partially
offset by inflation and increased spending to support a higher
sales level. Depreciation and amortization of $20.3 million
decreased 7% from the comparable 1996 period as a result of
certain assets becoming fully depreciated and amortized.
Research and development cost of $13.1 million approximated the
second quarter of 1996. Interest expense of $26.6 million
decreased 8% from the comparable 1996 period primarily due to
lower levels of indebtedness. Other expense of $583 thousand
compared to $599 thousand of other income in the second quarter
of 1996. The effective tax rate of 38.0% decreased slightly
versus 38.3% in the comparable 1996 period.
YEAR-TO-DATE RESULTS
Overview
Consolidated net sales of $968 million for the first six months
of 1997 increased 4% from the comparable period in 1996. The
increase resulted primarily from improved unit volume of 6%
offset equally by lower foreign currency translation and lower
pricing. International sales, including U.S. exports, decreased
as a percentage of total sales to 38% from 39% for the first six
months of 1996. Net earnings before extraordinary losses on
early extinguishment of debt increased 28% to $58.4 million, or
$.77 per common share, compared to $45.5 million, or $.63 per
common share, for the comparable 1996 period. Net earnings
including extraordinary losses on early extinguishment of debt
were $57.2 million, or $.75 per common share, compared to $45.1
million, or $.63 per common share, in 1996.
Gross margin as a percentage of net sales decreased slightly to
36.3% from 36.5% for the first six months of 1996. Consolidated
operating profit increased 13% to $148.5 million as the
specialty chemicals segment rose 12% and the specialty process
equipment and controls segment increased 17%.
Specialty Chemicals
The Company's specialty chemicals segment reported sales of $817
million, representing a 3% increase from the comparable 1996
period. Approximately 6% resulted from higher unit volume
offset equally by lower pricing and lower foreign currency
translation. An analysis of sales by major product class within
the specialty chemicals segment follows.
Chemicals and polymers sales of $253.9 million rose 2% from the
first six months of 1996. Unit volume was higher by 6%, but was
offset in part by lower pricing of 3% and lower foreign currency
translation of 1%. Sales of rubber chemicals were lower than
1996 primarily due to lower pricing. EPDM and nitrile rubber
sales increased primarily attributable to higher unit volume
offset in part by lower pricing.
Crop protection sales of $219.7 million increased 9% from the
comparable 1996 period primarily attributable to higher unit
volume. Sales increases for miticides in the U.S. and strong
demand for insecticides and fungicides worldwide contributed to
the improvement.
Specialty sales of $157.6 million increased 9% from the six
month period of 1996 primarily due to increased unit volume for
urethane prepolymers and additives for plastics and lubricants.
Color sales of $134 million declined 5% from the first six
months of 1996. The decrease was attributable equally to lower
foreign currency translation and lower pricing.
Specialty ingredients sales of $51.8 million were 1% lower than
the comparable period in 1996 primarily attributable to lower
unit volume as a result of product line rationalization.
Operating profit of $144.6 million for the first six months of
1997 increased 12% versus $129.4 million in the prior year. The
improvement in operating profit resulted primarily from an
increase in unit volume and lower operating costs.
Specialty Process Equipment and Controls
The Company's specialty process equipment and controls segment
reported sales of $151 million representing an 8% increase from
the 1996 six month period. Essentially all of the increase was
attributable to higher unit volume as a 2% increase from
acquisitions was offset by lower foreign currency translation of
2%. Operating profit of $15.7 million increased 17% versus the
comparable 1996 period primarily as a result of higher unit
volume.
Other
Selling, general and administrative expenses of $136.4 million
decreased 2% versus the comparable period in 1996 due to planned
cost reductions offset by inflation and increased spending to
support a higher sales level. Depreciation and amortization of
$40.2 million decreased 5% versus the 1996 period as a result of
certain assets becoming fully depreciated and amortized.
Research and development cost of $25.9 million decreased
slightly from $26.1 million in 1996. Interest expense of $53.5
million decreased 8% from the comparable period in 1996 due to
lower levels of indebtedness. Other expenses of $781 thousand
compared to $279 thousand of other income in 1996. The
effective tax rate of 38.0% decreased slightly versus 38.5% in
the comparable 1996 period.
LIQUIDITY AND CAPITAL RESOURCES
The June 28, 1997 working capital balance of $413.5 million
increased $28.7 million from year-end 1996. The current ratio
of 2.2 increased slightly from 2.1 at the end of 1996. Days
sales in receivables averaged 53 days for the six month period
in 1997 versus 55 days for 1996. Inventory turnover averaged
3.3 for the first half of 1997 versus 3.2 for 1996.
Net cash provided by operations of $95.6 million increased $18.0
million from the first half of 1996 primarily as a result of
increased net earnings. Cash provided by operations was used to
fund capital expenditures, reduce indebtedness and pay the
annual cash dividend. The Company's debt to total capital
percentage decreased to 105% from 110% at year-end 1996.
Capital expenditures are expected to approximate $50 to $55
million in 1997 primarily for replacement needs and improvement
of domestic and foreign facilities. The Company's long-term
liquidity needs including such items as capital expenditures and
debt repayments are ultimately expected to be financed from
future operations.
ENVIRONMENTAL MATTERS
The Company is involved in claims, litigation, administrative
proceedings and investigations of various types in a number of
jurisdictions. A number of such matters involve claims for a
material amount of damages and relate to or allege environmental
liabilities, including clean-up costs associated with hazardous
waste disposal sites, natural resource damages, property damage
and personal injury. The Company and some of its subsidiaries
have been identified by federal, state or local governmental
agencies, and by other potentially responsible parties (each a
"PRP") under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, or
comparable state statutes, as a PRP with respect to costs
associated with waste disposal sites at various locations in the
United States. In addition, the Company is involved with
environmental remediation and compliance activities at some of
its current and former sites in the United States and abroad.
Each quarter, the Company evaluates and reviews estimates for
future remediation and other costs to determine appropriate
environmental reserve amounts. For each site a determination is
made of the specific measures that are believed to be required
to remediate the site, the estimated total cost to carry out the
remediation plan, the portion of the total remediation costs to
be borne by the Company and the anticipated time frame over
which payments toward the remediation plan will occur. As of
June 28, 1997, the Company's reserves for environmental
remediation activities totaled $92.0 million. These estimates
may subsequently change should additional sites be identified,
circumstances change with respect to any site, the
interpretation of current laws and regulations be modified or
additional environmental laws and regulations be enacted.
The Company intends to assert all meritorious legal defenses and
all other equitable factors which are available to it with
respect to the above matters. The Company believes that the
resolution of these environmental matters will not have a
material adverse effect on the consolidated financial position
of the Company. While the Company believes it is unlikely, the
resolution of these environmental matters could have a material
adverse effect on the Company's consolidated results of
operation in any given year if a significant number of these
matters are resolved unfavorably.
Part II -- Other Information
Item 1. Legal Proceedings.
(i) The Registrant's subsidiary, Uniroyal Chemical Company,
Inc., manufactures nitrile rubber at its Painesville, Lake
County, Ohio plant (the "Painesville Plant"). The Painesville
Plant pretreats and discharges its process wastewater to the Lake
County sanitary sewer system for treatment at Lake County's
Greater Mentor Wastewater Treatment Plant ("GMWTP"). On June 15,
1993, Lake County submitted to the State of Ohio Environmental
Protection Agency ("Ohio EPA") a proposed Local Limit aimed at
regulating the amount of substances which absorb at 230
nanometers that are discharged in wastewater to the GMWTP. One
of the principal ingredients in the Painesville Plant's nitrile
rubber manufacturing process, which is known as Tamol, absorbs at
230 nanometers. Lake County claims that Tamol interferes with
the treatment process at the GMWTP and causes the GMWTP to
violate the 30-day average total suspended solids and total
phosphorus limits in its NPDES permit.
Ohio EPA approved the Local Limit on March 9, 1994.
The Painesville Plant appealed Ohio EPA's approval of the Local
Limit to the Ohio Environmental Board of Review (the "EBR").
Beginning in July 1996, Lake County began issuing Notices of
Violation and assessing $1,000 per day administrative fines for
the Painesville Plant's violation of the Local Limit. From July
1996 through April 30, 1997, Lake County has assessed against the
Painesville Plant a total of $266,000 in administrative fines.
In addition, Lake County has ordered Uniroyal Chemical to
reimburse it for $106,295 in fines Lake County has paid the State
of Ohio for the GMWTP's violations of its NPDES permit. The
Painesville Plant appealed Lake County's Reimbursement Order and
its initial assessment of administrative fines to the Lake County
Court of Common Pleas.
In September 1996, the Painesville Plant submitted to
Lake County a proposed schedule for achieving compliance with the
Local Limit. Since December 1996, the Painesville Plant, Lake
County, and Ohio EPA have been negotiating in an effort to settle
the above-described disputes. Since the parties commenced
settlement negotiations in December 1996, all legal proceedings
concerning the above-described matters have been stayed
voluntarily by agreement of the parties.
(ii) Reference is made to page 16 of the Registrant's 1996
Annual Report on Form 10-K for information pertaining to the
Vertac Chemical Corporation site in Jacksonville, Arkansas. On
May 21, 1997, the Court (a) ruled that the Registrant's
subsidiary, Uniroyal Chemical Ltd., is jointly and severally
liable with Hercules and Vertac for the contamination of the
Vertac plant site and the remediation costs associated with that
contamination; (b) sustained the jury's finding in favor of
Uniroyal Chemical Ltd. on its contribution claim against
Hercules; (c) reversed the jury's finding that Hercules was not
entitled to contribution from Uniroyal Chemical Ltd.; and (d)
reversed the jury's finding that the damages at the site which
were caused by Uniroyal Chemical Ltd. were divisible. As no
party to the decision has sought any interlocutory appeal, it is
anticipated that discovery within the allocation phase of the
proceedings will begin within the next three months. In
addition, the State of Arkansas has commenced an action for
natural resource damages which is currently pending in the State
court, but Uniroyal Chemical Ltd. has not been named a party in
that action.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Number Description
(4)* $600,000,000 Second Amended and
Restated Credit Agreement dated as
of July 25, 1997, by and among
Crompton & Knowles Corporation and
certain of its subsidiaries, as
Borrowers, and various lenders, and
Citicorp USA, Inc., as Agent and The
Chase Manhattan Bank as Managing Agent.
(11) Statement Re Computation of
Per Share Earnings
(27)* Financial Data Schedule
(b) No reports on Form 8-K were filed during the quarter
for which this report is filed.
* A copy of this Exhibit is annexed to this report on Form
10-Q provided to the Securities and Exchange Commission and the
New York Stock Exchange.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange
Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized.
CROMPTON & KNOWLES CORPORATION
(Registrant)
August 12, 1997 By:/s/ Charles J. Marsden
Charles J. Marsden
Senior Vice President &
Chief Financial Officer
August 12, 1997 By:/s/ John T. Ferguson II
John T. Ferguson II
Vice President, General
Counsel and Secretary