UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1995
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. 1-985
INGERSOLL-RAND COMPANY
(Exact name of registrant as specified in its charter)
New Jersey 13-5156640
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Woodcliff Lake, New Jersey 07675
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (201)573-0123
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
Series A Preference New York, London and
Stock Purchase Rights Amsterdam Stock Exchanges
Common Stock, $2 par value New York, London and
Amsterdam Stock Exchanges
Securities registered pursuant to Section 12(g) of the Act: None
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 by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K [ X ]
1
The aggregate market value of common stock held by nonaffiliates
on March 13, 1996 was $4,521,289,143 based on the closing price
of such stock on the New York Stock Exchange. This includes the
shares owned by the Registrant's Leveraged Employee Stock
Ownership Plan.
The number of shares of common stock outstanding as of March 13,
1996 was 109,064,532.
DOCUMENTS INCORPORATED BY REFERENCE
Annual Report to Shareowners for fiscal year ended December 31,
1995. With the exception of those portions which are
incorporated by reference into Parts I, II and IV of this Form
10-K Annual Report, the 1995 Annual Report to Shareowners is not
to be deemed filed as part of this report.
Proxy Statement for Annual Meeting of Shareholders to be held
on April 26, 1996. See Part III of this Form 10-K Annual Report
for portions incorporated by reference. (A definitive proxy
statement has been filed with the Commission since the close of
the fiscal year).
PART I
Item 1. BUSINESS
Ingersoll-Rand Company (the company) was organized in
1905 under the laws of the State of New Jersey as a consolidation
of Ingersoll-Sergeant Drill Company and the Rand Drill Company,
whose businesses were established in the early 1870's. Over the
years, the company has supplemented its original business, which
consisted primarily of the manufacture and sale of rock drilling
equipment, with additional products which have been developed
internally or obtained through acquisition.
The following acquisitions have been accounted for as
purchases and, accordingly, each purchase price was allocated to
the acquired assets and assumed liabilities based on their
estimated fair values. The results of operations since the dates
of acquisition are included in the consolidated financial
statements.
o In August 1993, the company acquired the Kunsebeck, Germany,
needle and cylindrical bearing business of FAG Kugelfischer
Georg Schafer AG of Schweinfurt, Germany, for $42.5 million in
cash.
o In April 1994, the company acquired full ownership of the ball
bearing joint venture with GMN Georg Mueller of America, Inc.
for $4.9 million in cash.
2
o In June 1994, the company acquired Montabert S.A., a French
manufacturer of hydraulic rock-breaking and drilling equipment
for $18.4 million in cash plus assumption of liabilities.
o In August 1994, the company acquired the Ecoair air compressor
product line from MAN Gutehoffnungshutte AG (MAN GHH) for
$10.6 million in cash. The company also entered into a 50/50
joint venture, GHH-RAND Schraubenkompressoren GmbH & Co. KG
(GHH-RAND) with MAN GHH to manufacture airends. The company
invested approximately $17.6 million in GHH-RAND.
o In May 1995, the company acquired Clark Equipment Company (Clark)
for approximately $1.5 billion in cash. Clark's business is the
design, manufacture and sale of skid-steer loaders, compact
excavators, agricultural equipment, asphalt paving equipment,
transmissions for off-highway equipment, golf cars and light
utility vehicles.
o On January 31, 1996, the company acquired the Steelcraft
Division of MascoTech, Inc. Steelcraft manufactures a wide
range of cold-rolled and galvanized steel doors for use
primarily in nonresidential construction.
Dispositions that the company has made in recent years
are as follows:
o The company sold the assets of several small business units in
1993, as well as substantially all of the assets of its coal-
mining machinery and aerospace bearings businesses for $55.5
million in cash.
o In 1994, the assets of the Ingersoll-Dresser Pump Company (IDP)
Australian operations were sold in return for shares of the
purchaser. The company and Dresser Industries sold IRI
International Corporation, a 50/50 joint venture that is a
manufacturer of mobile drilling rigs, to a third party.
o In May 1995, the company sold the domestic paving equipment
business to Champion Road Machinery Limited of Canada. The
sale was a preacquisition requirement, in order to satisfy
concerns of the United States Justice Department, prior to the
Clark acquisition. The company incurred a $7.1 million pretax
loss associated with this sale.
o On March 27, 1996, the company sold the assets of the Pulp
Machinery Division to Beloit Corporation, a subsidiary of
Harnischfeger Industries, Inc. The sales price is in excess
of the book value of the assets.
3
Products
The company manufactures and sells primarily
nonelectrical machinery and equipment. Principal products
include the following:
Abrasive blasting and recovery Foundation drills
systems Golf cars
Agricultural sprayers Hoists
Air compressors Industrial pumps
Air dryers Lubrication equipment
Air logic controls Material handling equipment
Air motors Monitoring drills
Air tools Needle roller bearings
Architectural hardware trim Paving equipment
Asphalt compactors Pellet mills
Automated-parts finishing Pneumatic cylinders
systems Pneumatic valves
Automated production systems Portable compressors
Automotive components Portable generators
Axles Portable light towers
Ball bearings Road-building machinery
Blasthole drills Rock drills
Compact hydraulic excavators Roller bearings
Construction equipment Rotary drills
Diaphragm pumps Rough-terrain forklifts
Door closers Skid-steer loaders
Door hardware Soil compactors
Door locks Spray-coating systems
Emergency exit devices Transmissions
Engineered pumps Utility vehicles
Engine-starting systems Waterjet-cutting systems
Extrusion systems Water well drills
Fluid-handling equipment Winches
Feed-processing equipment
These products are sold primarily under the company's
name and also under other names including Torrington, Fafnir,
Klemm, Schlage, CPM, LCN Closers, Von Duprin, Aro, ABG,
Ingersoll-Dresser Pumps, Pacific, Worthington, Jeumont-Schneider
Pumps, Pleuger, Blaw-Knox, Melroe, Club Car and Clark-Hurth.
During the past three years, the division of the
company's sales between capital goods and expendables has been in
the approximate ratio of 55 percent and 45 percent, respectively.
The company generally defines as expendables those products which
are not capitalized by the ultimate user. Examples of such
products are parts sold for replacement purposes, power tools and
needle bearings.
4
Club Car's peak sales of golf cars occur during the
months of February through June when units are shipped to golf
clubs at the beginning of their golf season. Warm weather
states, such as California and Florida, have golf seasons
beginning in the fall which stimulate fleet and retail sales
during the fall. Sales of Club Car's utility vehicle products
occur year-round but are heavier in the spring.
Additional information on the company's business and
financial information about industry segments is presented in
footnote 15 to the Consolidated Financial Statements of the
company included in the company's Annual Report to Shareowners
for 1995, incorporated by reference in this Form 10-K Annual Report.
Distribution
The company's products are distributed by a number of
methods which the company believes are appropriate to the type of
product. Sales are made domestically through branch sales
offices and through distributorships and dealers across the
United States. International sales are made through
approximately 60 subsidiary sales and service companies with a
supporting chain of distributors in over 100 countries.
Working Capital
The working capital requirements of the company vary with
respect to the many products and industries in which it is
involved. In general, the requirements of its Engineered
Equipment Segment, which manufactures machinery for specialized
customer needs, involve a relatively long lead time and, at
times, more significant company investment with respect to the
particular product or order. Historically, these orders are
generally covered by progress payments, which reduce the
company's investment in the amount of inventory maintained by
this segment. The products manufactured by the company's
Standard Machinery and Bearings, Locks and Tools segments are
more in the nature of standard equipment. Consequently, a wider
variety must usually be more readily available to meet rapid
delivery requirements. Such working capital requirements are
not, however, in the opinion of management, materially different
from those experienced by the company's major competitors.
Customers
No material part of the company's business is dependent
upon a single customer or very few customers, the loss of any one
of which would have a material adverse effect on the company's
operations.
5
Competitive Conditions
The company's products are sold in highly competitive
markets throughout the world against products produced by both
foreign and domestic corporations. The principal methods of
competition in these markets relate to price, quality and
service. The company believes that it is one of the leading
manufacturers in the world of a broad line of air compression
systems, anti-friction bearings, construction equipment, air
tools, pumps (through the IDP joint venture), golf cars and
utility vehicles. In addition, the company believes it is a
leading supplier in domestic markets for locks, other door
hardware products, skid-steer loaders and asphalt paving
equipment.
International Operations
Sales to customers outside the United States, including
domestic sales for export, accounted for approximately 44 percent
of the consolidated net sales in 1995. Information as to
operating income by geographic area is set forth in footnote 15
to the Consolidated Financial Statements of the company included
in the company's Annual Report to Shareowners for 1995,
incorporated by reference in this Form 10-K Annual Report. Sales
outside of the United States are made in more than 100 countries;
therefore, the attendant risks of manufacturing or selling in a
particular country, such as nationalization and establishment of
common markets, would not have a significant effect on the company's
international operations.
Raw Materials
The company manufactures many of the components included
in its products. The principal raw materials required for the
manufacture of the company's products are purchased from numerous
suppliers, and the company believes that available sources of
supply will generally be sufficient for its needs for the
foreseeable future.
Backlog
The company's approximate backlog of orders at December
31, 1995, believed by it to be firm, was $389 million for the
Standard Machinery Segment, $636 million for the Engineered
Equipment Segment and $564 million for the Bearings, Locks and
Tools Segment as compared to $176 million, $395 million and $438
million, respectively, at December 31, 1994. These backlog
figures are based on orders received. While the major portion of
the company's products are built in advance of order and either
shipped or assembled from stock, orders for specialized machinery
or specific customer application are submitted with extensive
lead time and are often subject to revision, deferral,
cancellation or termination. The company estimates that
approximately 90 percent of the backlog will be shipped during
the next twelve months.
6
Research, Engineering and Development
The company maintains extensive research, engineering and
development facilities for experimenting, testing and developing
high quality products. The company employs approximately 1,700
professional employees for its research, engineering and
development activities. The company spent $190 million in 1995,
$155 million in 1994 and $150 million in 1993 on research,
engineering and development.
Patents and Licenses
The company owns numerous patents and patent applications
and is licensed under others. While it considers that in the
aggregate its patents and licenses are valuable, it does not
believe that its business is materially dependent on its patents
or licenses or any group of them. In the company's opinion,
engineering and production skills, and experience are more
responsible for its market position than patents or licenses.
Environmental Matters
The company is subject to extensive environmental laws
and regulations. We believe that the company, as well as
industry in general, will be faced with increasingly stringent
laws and regulations in the future. As a result, the company has
been and continues to be dedicated to an environmental program to
reduce the utilization and generation of hazardous materials
during the manufacturing process and to remediate identified
environmental concerns. As to the latter, the company currently
is engaged in site investigations and remedial activities to
address environmental cleanup from past operations at current and
former manufacturing facilities, including the facilities added
through the Clark acquisition.
During 1995, the company spent approximately $6 million
on capital projects for pollution abatement and control and an
additional $8 million for environmental remediation expenditures,
including operation and maintenance of existing environmental
programs. It should be noted that these amounts are difficult to
estimate because environmental improvements are generally
intertwined with the overall improvement costs at a particular
plant, and the accurate estimate of which portion of an
improvement or a capital expenditure relates to an environmental
improvement is difficult to ascertain. The company believes that
these expenditure levels will continue and may increase over
time. Given the evolving nature of environmental laws,
regulations and technology, the ultimate cost of future
compliance is uncertain.
7
The company is a party to environmental lawsuits and
claims. It has received notices of potential violations of
environmental laws and regulations from the Environmental
Protection Agency and similar state authorities, and is
identified as a potentially responsible party (PRP) for cleanup
costs at approximately 41 federal Superfund and state remediation
sites (including Clark-acquired PRP locations). For all sites
there are other PRPs and in most instances, the company's site
involvement is minimal. While all PRPs may be jointly and
severally liable to pay all site investigation and remediation
costs, to date there is no indication the company will be liable
for more than the costs of its own percentage of responsibility
at any site. Additional lawsuits and claims involving
environmental matters are likely to arise from time to time in
the future.
Although uncertainties regarding environmental
technology, state and federal laws and regulations and individual
site information make estimating the liability difficult,
management believes that the total liability for the cost of
remediation and environmental lawsuits and claims will not have a
material effect on the financial condition, results of
operations, liquidity or cash flows of the company for any year.
It should be noted that when the company estimates its liability
for environmental matters, such estimates are based on current
technologies and the company does not discount its liability or
assume any insurance recoveries.
Employees
There are approximately 41,100 employees of the company
throughout the world, of whom approximately 28,600 work in the
United States and 12,500 in foreign countries. Approximately 32
percent of the company's United States production and maintenance
employees, who work in 11 plants, are represented by 5 unions.
The company believes relations with its employees are satisfactory.
Item 2. PROPERTIES
The company's executive offices are located at Woodcliff
Lake, New Jersey. Manufacturing and assembly operations are
conducted in 51 plants in the United States; 6 plants in Canada;
32 plants in Europe; 7 plants in Asia; 5 plants in Latin
America and 1 plant in Africa. The company also maintains various
warehouses, offices and repair centers in the United States,
Canada and abroad.
8
Substantially all plant facilities are owned by the
company and the remainder are under long-term lease. The company
believes that its plants and equipment have been well-maintained
and are generally in good condition. The company has several
closed facilities that it is actively marketing with the intent
of selling them at their net realizable value.
The operating segments for which the facilities are
primarily used are as described below. Facilities that produce
products in several operating segments are classified by the
products which they primarily manufacture. Facilities under
long-term lease are included below and are not significant to
each operating segment's total number of plants or square
footage.
Standard Machinery
This segment's products include machinery regularly used
in general manufacturing and in industries such as mining and
construction. Products range from blasthole drills used in
mining and construction, small air compressors found worldwide in
auto service stations, skid-steer loaders and golf cars. The
segment is aligned into five operating groups: Air Compressor,
Construction and Mining, Melroe, Club Car and Mining Machinery
(which was sold in 1993). The segment's manufacturing locations
are as follows:
Approximate
Number of Plants Square Footage
Domestic 11 3,321,000
International 13 2,338,000
Total 24 5,659,000
Engineered Equipment
The products manufactured by this segment are
predominantly designed for specific customer applications. The
segment's diverse product line includes pumps, liquid/solid
separation, densification machinery and axles and transmissions
for off-highway vehicles. The segment is organized into three
operating groups: Pump, Process Systems (a portion of which was
sold in 1996) and Clark-Hurth. The segment's manufacturing
facilities are as follows:
Approximate
Number of Plants Square Footage
Domestic 12 2,969,000
International 23 3,081,000
Total 35 6,050,000
9
Bearings, Locks and Tools
This segment primarily serves the automotive, capital
goods, energy and construction industries. Products in this
segment include bearings for specialized and industrial
application, locks and door hardware for residential and
commercial buildings, air tools for industrial use, air winches,
hoists and engine starting systems, and automated production
systems for transportation equipment manufacturers. There are
three operating groups in this segment: Bearings and Components
Group, Production Equipment Group and Architectural Hardware
Group (formerly known as Door Hardware Group). The segment's
manufacturing facilities are as follows:
Approximate
Number of Plants Square Footage
Domestic 28 6,288,000
International 15 1,683,000
Total 43 7,971,000
Item 3. LEGAL PROCEEDINGS
In the normal course of business, the company is involved
in a variety of lawsuits, claims and legal proceedings, including
proceedings for the cleanup of approximately 41 waste sites under
federal Superfund and similar state laws. In the opinion of the
company, pending legal matters, including the one discussed
below, are not expected to have a material adverse affect on the
results of operations, financial condition, liquidity or cash
flows.
On October 5, 1992, the United States Environmental
Protection Agency (EPA) issued a Finding of Violation and Order
for Compliance (Order) which alleges that Clark has failed to
comply with the pretreatment regulations promulgated pursuant to
Section 306 and 307 of the Clean Water Act. The Order alleges
that certain metal finishing wastewaters generated at the Clark
Melroe facility in Gwinner, North Dakota were discharged into the
Publicly Owned Treatment Works (POTW) operated by the City of
Gwinner in violation of the applicable pretreatment regulations.
The Order also alleges that Clark failed to comply with the
discharge limitations for metal finishing wastewater and all
related reporting requirements. Clark has taken all actions
required of it under the Order.
10
On April 29, 1994, in United States of America v. Clark
Equipment Company d/b/a Melroe Company, the U.S. filed suit
against Clark in the United States District Court for the
District of North Dakota. The complaint seeks (i) to permanently
enjoin Clark to comply fully with all applicable requirements of
the Act and Regulations and (ii) civil penalties against Clark of
up to $25,000 per day for each violation for (a) alleged
discharges of pollutants in violations of the effluent
limitations contained in the pretreatment regulations, (b) a
failure to submit timely and complete reports and (c) a failure
to sample and analyze its regulated wastewater prior to discharge
into the POTW. This case is now awaiting trial.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of the company's
security holders during the last quarter of its fiscal year ended
December 31, 1995.
11
The following information is included in accordance with the
provision of Part III, Item 10.
Date of
Service as Principal Occupation and
an Executive Other Information
Name and Age Officer for Past Five Years
James E. Perrella(60) 5/4/77 Chairman of the Board,
President and Chief
Executive Officer,
Director (President and
Director, 1992 - 1993;
Executive Vice President,
1982 - 1992)
J. Frank Travis(60) 2/7/90 Executive Vice President
(Executive Vice President
and President of the
Production Equipment
Group, 1993 - 1995; Vice
President and President
of the Bearings and
Components Group, 1992 -
1993; President of the Air
Compressor Group, 1989 -
1992)
Thomas F. McBride(60) 9/5/79 Senior Vice President and
Chief Financial Officer
(Senior Vice President
and Comptroller, 1992 -
1993; Vice President and
Comptroller, 1981 - 1992)
William J. Armstrong(54) 8/3/83 Vice President and Treasurer
Paul L. Bergren(46) 12/2/92 Vice President, President
of the Air Compressor
Group, and President of
Ingersoll-Rand Europe
(Vice President and
General Manager -
Centrifugal Compressor
Division, 1989 - 1992)
Frederick W. Hadfield(59) 8/1/79 Vice President and President
of IDP (Vice President,
1979 - 1994)
Brian D. Jellison(50) 2/7/96 Vice President and President
of the Architectural
Hardware Group (President
of the Door Hardware
Group, 1994 - 1995;
President, Von Duprin,
1988 - 1994)
12
Date of
Service as Principal Occupation and
an Executive Other Information
Name and Age Officer for Past Five Years
Daniel E. Kletter(57) 2/7/90 Vice President (Vice
President and President of
the Construction and
Mining Group, 1989 - 1994)
Patricia Nachtigal(49) 11/2/88 Vice President and General
Counsel (Secretary and
Managing Attorney, 1988 -
1991)
Allen M. Nixon(55) 2/1/95 Vice President and President
of Bearing and Components
Group (Vice President and
General Manager Torrington
Needle Bearings Division,
1983 - 1994)
James R. O'Dell(57) 12/3/88 Vice President
Nicholas J. Pishotti(55) 4/10/95 Vice President and Vice
President Strategic
Sourcing (General Manager,
Aircraft Engine Sourcing
Department, General
Electric Company, 1988 -
1995)
Larry H. Pitsch(55) 2/7/90 Vice President and President
of the Process Systems
Group
Donald H. Rice(51) 2/1/95 Vice President (Executive
Director - Human Resources
1994; Vice President,
Human Resources - Bearings
and Components Group, 1988
- 1993)
Gerald E. Swimmer(51) 5/1/82 Vice President
R. Barry Uber(50) 2/7/90 Vice President and President
of the Construction and
Mining Group (Vice
President and President of
the Production Equipment
Group, 1990 - 1994)
Ronald G. Heller(49) 2/6/91 Secretary and Assistant
General Counsel (Assistant
General Counsel, 1988 -
1991)
No family relationship exists between any of the above-listed
executive officers of the company. All officers are elected to
hold office for one year or until their successors are elected
and qualify.
13
PART II
Item 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
Information regarding the principal market for the
company's common stock and related stockholder matters are as
follows:
Quarterly share prices and dividends for the common stock are
shown in the following tabulation. The common shares are listed
on the New York Stock Exchange and also on the London and
Amsterdam exchanges.
Common Stock
High Low Dividend
1995
First quarter $34 $28 3/8 $.185
Second quarter 39 3/8 32 5/8 .185
Third quarter 42 3/8 35 5/8 .185
Fourth quarter 38 5/8 33 5/8 .185
High Low Dividend
1994
First quarter $41 5/8 $34 5/8 $.175
Second quarter 38 7/8 32 3/4 .175
Third quarter 38 3/4 34 3/8 .185
Fourth quarter 36 1/4 29 1/2 .185
The Bank of New York (Church Street Station, P.O. Box
11258, New York, NY 10286-1258, (800)524-4458) is the transfer
agent, registrar and dividend reinvestment agent.
There are no significant restrictions on the payment of
dividends. The approximate number of record holders of common
stock as of March 13, 1996 was 13,706.
14
Item 6. SELECTED FINANCIAL DATA
Selected financial data for the five years ended December
31, 1995, is as follows (in millions except per share amounts):
December 31 1995 1994 1993 1992 1991
Net sales $5,729.0 $4,507.5 $4,021.1 $3,783.8 $3,586.2
Net earnings (loss) 270.3 211.1 142.5 (234.4) 150.6
Total assets 5,563.3 3,596.9 3,375.3 3,387.6 2,979.6
Long-term debt 1,304.4 315.9 314.1 355.6 375.8
Shareowners' equity 1,795.5 1,531.3 1,349.8 1,293.4 1,633.1
Earnings (loss) per
common share $2.55 $2.00 $1.36 $(2.25) $1.45
Dividends per
common share 0.74 0.72 0.70 0.69 0.66
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Management's discussion and analysis of financial
condition and results of operations is included as Financial
Review and Management Analysis in Exhibit 13 - the Annual Report
to Shareowners for 1995 and is incorporated by reference in this
Form 10-K Annual Report.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The following financial statements and supplementary
financial information included in the accompanying Annual Report
to Shareowners for 1995 are incorporated by reference in this
Form 10-K Annual Report:
(a) The consolidated financial statements and the report
thereon of Price Waterhouse LLP dated February 6, 1996, are
included as Exhibit 13 - the Annual Report to Shareowners
(excluding the Financial Review and Management Analysis) for
1995.
15
(b) The unaudited quarterly financial data for the
two-year period ended December 31, 1995, is as follows (in
millions except per share amounts):
Earnings
per
Net Cost of Operating Net common
1995 sales goods sold income earnings share
First quarter $1,185.6 $ 893.1 $ 89.2 $ 46.3 $0.44
Second quarter 1,392.1 1,051.0 118.7 66.6 0.63
Third quarter 1,521.3 1,163.2 119.1 61.8 0.58
Fourth quarter 1,630.0 1,202.9 170.0 95.6 0.90
Year 1995 $5,729.0 $4,310.2 $497.0 $270.3 $2.55
1994
First quarter $1,010.3 $ 775.9 $ 60.1 $ 33.0 $0.31
Second quarter 1,143.8 866.0 91.8 51.5 0.49
Third quarter 1,113.7 840.2 89.0 48.4 0.46
Fourth quarter 1,239.7 895.0 136.1 78.2 0.74
Year 1994 $4,507.5 $3,377.1 $377.0 $211.1 $2.00
o The reductions in LIFO inventory quantities increased net
earnings per share by $0.02 in the fourth quarter of 1995 and
$0.01 and $0.06 in the third and fourth quarters of 1994,
respectively.
o The second, third and fourth quarters of 1995 include the
results of Clark Equipment Company (see Note 2 of the
Consolidated Financial Statements).
Item 9. CHANGES IN AND DISAGREEMENTS WITH INDEPENDENT
ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
16
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information required by Item 10 is (i) incorporated
by reference in this Form 10-K Annual Report from pages 1 through
6 of the company's definitive proxy statement for the Annual
Meeting of Shareholders to be held on April 26, 1996, and (ii)
included in Part I on pages 12 and 13 of this Form 10-K Annual
Report.
Item 11. EXECUTIVE COMPENSATION
Information on executive compensation is incorporated by
reference in this Form 10-K Annual Report from pages 6 through 15
of the company's definitive proxy statement for the Annual
Meeting of Shareholders to be held on April 26, 1996.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
Information on security ownership of directors and
nominees, directors and officers as a group and certain
beneficial owners is incorporated by reference in this Form 10-K
Annual Report on pages 4 and 5 of the company's definitive proxy
statement for the Annual Meeting of Shareholders to be held on
April 26, 1996.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information required by Item 13 is incorporated by
reference in this Form 10-K Annual Report from page 15 of the
company's definitive proxy statement for the Annual Meeting of
Shareholders to be held on April 26, 1996.
17
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K
(a) 1. and 2. Financial statements and financial statement
schedules
The financial statements, together with the
report thereon of Price Waterhouse LLP dated
February 6, 1996, included as Exhibit 13
(excluding Financial Review and Management
Analysis) and the unaudited quarterly financial
data included in Part II Item 8(b) are
incorporated by reference in this Form 10-K
Annual Report. The financial statement schedule
listed in the accompanying index should be read
in conjunction with the financial statements in
such Annual Report to Shareowners for 1995.
Separate financial statements for all 50
percent or less owned companies, accounted for
by the equity method have been omitted because
no individual entity constitutes a significant
subsidiary.
3. Exhibits
The exhibits listed on the accompanying
index to exhibits are filed as part of this Form
10-K Annual Report.
(b) Reports on Form 8-K
None.
18
INGERSOLL-RAND COMPANY
INDEX TO FINANCIAL STATEMENTS
AND FINANCIAL STATEMENT SCHEDULES
(Item 14 (a) 1 and 2)
Form
10-K
Consolidated Financial Statements:
Report of independent accountants . . . . . . . . . . *
Consolidated balance sheet at
December 31, 1995 and 1994 . . . . . . . . . . . . *
For the years ended December 31, 1995, 1994
and 1993:
Consolidated statement of income . . . . . . . . . *
Consolidated statement of shareowners'
equity . . . . . . . . . . . . . . . . . . . . . *
Consolidated statement of cash flows . . . . . . . *
Notes to consolidated financial statements . . . . . *
Selected unaudited quarterly financial data . . . . . . 16
Financial Statement Schedule:
Report of independent accountants on
financial statement schedule . . . . . . . . . . . 20
Consolidated schedule for the years ended
December 31, 1995, 1994 and 1993:
Schedule II -- Valuation and Qualifying
Accounts . . . . . . . . . . . . . . . . . . . . 21
* See Exhibit 13 - Ingersoll-Rand Company Annual Report to
Shareowners for 1995.
Financial statement schedules not included in this Form 10-K
Annual Report have been omitted because they are not applicable
or the required information is shown in the financial statements
or notes thereto.
Financial statements of the company's 50 percent or less owned
companies, are omitted because individually they do not meet the
significant subsidiary test of Rule 3-09 of Regulation S-X.
19
REPORT OF INDEPENDENT ACCOUNTANTS ON
FINANCIAL STATEMENT SCHEDULE
To the Board of Directors of Ingersoll-Rand Company:
Our audits of the consolidated financial statements referred to
in our report dated February 6, 1996 included as part of Exhibit
13 - the Annual Report to Shareowners for 1995 of Ingersoll-Rand
Company, (which report and consolidated financial statements are
incorporated by reference in this Annual Report on Form 10-K)
also included an audit of the Financial Statement Schedule listed
in Item 14(a) of this Form 10-K. In our opinion, this Financial
Statement Schedule presents fairly, in all material respects, the
information set forth therein when read in conjunction with the
related consolidated financial statements.
/S/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
Morristown, New Jersey
February 6, 1996
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the
Prospectus constituting part of the Registration Statement on
Form S-3 (No. 33-60249) and to the incorporation by reference in
the Registration Statements on Form S-8 (No. 333-00829, No. 33-
35229, No. 2-98258 and Post-Effective Amendment No. 4 to No.
2-64708) of Ingersoll-Rand Company of our report dated February
6, 1996 included as part of Exhibit 13 - the Annual Report to
Shareowners for 1995, which is incorporated in this Annual Report
on Form 10-K. We also consent to the incorporation by reference
of our report on the Financial Statement Schedule, which appears
on this page.
/S/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
Morristown, New Jersey
March 29, 1996
20
SCHEDULE II
INGERSOLL-RAND COMPANY
VALUATION AND QUALIFYING ACCOUNTS
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 and 1993
(Amounts in millions)
Additions
charged to
Balance at costs and Balance
beginning expenses Deductions at end
Description of year (*) (**) of year
1995
Doubtful accounts $25.9 $17.8 $ 5.4 $38.3
1994
Doubtful accounts $22.1 $12.6 $ 8.8 $25.9
1993
Doubtful accounts $23.1 $10.2 $11.2 $22.1
(*) "Additions" include foreign currency translation.
(**) "Deductions" include accounts and advances written off,
less recoveries.
21
INGERSOLL-RAND COMPANY
INDEX TO EXHIBITS
(Item 14(a))
Description Page
2 Agreement and Plan of Merger, dated as of April 9,
1995 by and among Ingersoll-Rand Company, CEC
Acquisition Corp. and Clark Equipment Company
(Incorporated by reference from Amendment No. 2 to
Schedule 14D-1 with respect to the tender offer by
CEC Acquisition Corp., a wholly-owned subsidiary
of Ingersoll-Rand Company, for shares of Clark
Equipment Company.) -
3 (i) Amendment to Restated Certificate of Incorporation
of Ingersoll-Rand Company filed May 28, 1992.
Incorporated by reference to Form 10-K of Ingersoll-Rand
Company for Fiscal Year Ended December 31, 1993. (See
pages 30-32 of the 1993 Form 10-K). -
3 (ii) Restated Certificate of Incorporation of
Ingersoll-Rand Company as amended through May 28, 1992.
Incorporated by reference to Form 10-K of Ingersoll-Rand
Company for Fiscal Year Ended December 31, 1993. (See
pages 33-60 of the 1993 Form 10-K). -
3 (iii) By-Laws of Ingersoll-Rand Company, as amended
through January 1, 1996. 28-42
4 (i) Rights Agreement, dated as of December 7, 1988, as
amended by Amendment No. 1 thereto dated as of December 7,
1994. Incorporated by reference from Form 8-A of Ingersoll-
Rand Company filed on December 12, 1988, and Form 8-A/A
of Ingersoll-Rand Company filed December 15, 1994. -
4 (ii) Indenture, dated as of August 1, 1986 between
Ingersoll-Rand Company and the Bank of New York, as
Trustee, as supplemented. (Incorporated by reference to
Exhibits 4.1, 4.2 and 4.3 of the company's Form S-3
Registration Statement No. 33-39474). -
22
INGERSOLL-RAND COMPANY
INDEX TO EXHIBITS
(Item 14(a))
(Continued)
Description Page
4 (iii) Ingersoll-Rand Company is a party to several
long-term debt instruments under which in each case the
total amount of securities authorized does not exceed
10% of the total assets of Ingersoll-Rand Company and
its subsidiaries on a consolidated basis. Pursuant to
paragraph 4(iii)(A) of Item 601(b) of Regulation S-K,
Ingersoll-Rand Company agrees to furnish a copy of such
instruments to the Securities and Exchange Commission
upon request. -
10 (iii) The following exhibits constitute management
contracts or compensatory plans or arrangements required
by Item 601 of Regulation S-K.
10 (iii) (a) Management Incentive Unit Plan of Ingersoll-
Rand Company. Amendment to the Management Incentive Unit
Plan, effective January 1, 1982. Amendment to the
Management Incentive Unit Plan, effective January 1, 1987.
Amendment to the Management Incentive Unit Plan, effective
June 3, 1987. Incorporated by reference to Form 10-K of
Ingersoll-Rand Company for Fiscal Year Ended December 31,
1993. (See pages 78-92 of the 1993 Form 10-K). -
10 (iii) (b) Description of Ingersoll-Rand Company
Retirement Plan for Non-employees Directors.
Incorporated by reference to Form 10-K of Ingersoll-
Rand Company for Fiscal Year Ended December 31, 1994.
(See pages 39-47 of the 1994 Form 10-K). -
10 (iii) (c) Form of Contingent Compensation Agreements
with Executive Vice Presidents and Group Presidents of
Ingersoll-Rand Company. 43-47
10 (iii) (d) Description of Bonus Arrangements for
Chairman, President and Staff Officers. Incorporated by
reference to Form 10-K of Ingersoll-Rand Company for
Fiscal Year Ended December 31, 1993. (See page 100
of the 1993 Form 10-K). -
10 (iii) (e) Form of Change of Control Agreement with
Chairman and Chief Executive Officer of Ingersoll-Rand
Company. 48-64
23
INGERSOLL-RAND COMPANY
INDEX TO EXHIBITS
(Item 14(a))
(Continued)
Description Page
10 (iii) (f) Form of Change of Control Agreement
with selected executive officers other than
Chairman of Ingersoll-Rand Company. 65-84
10 (iii) (g) Executive Supplementary Retirement
Agreement for selected executive officers.
Incorporated by reference to Form 10-K of
Ingersoll-Rand Company for Fiscal Year Ended
December 31, 1993. (See pages 127-132 of the
1993 Form 10-K). -
10 (iii) (h) Incentive Stock Plan of 1985 of Ingersoll-
Rand Company. Incorporated by reference to Form 10-K of
Ingersoll-Rand Company for Fiscal Year Ended December
31, 1993. (See pages 133-151 of the 1993 Form 10-K). -
10 (iii) (i) Forms of insurance and related letter
agreements with certain executive officers.
Incorporated by reference to Form 10-K of Ingersoll-Rand
Company for Fiscal Year Ended December 31, 1993. (See
pages 152-160 of the 1993 Form 10-K). -
10 (iii) (j) Incentive Stock Plan of 1990 of Ingersoll-
Rand Company. Incorporated by reference to Form 10-K of
Ingersoll-Rand Company for Fiscal Year Ended December
31, 1993. (See pages 161-182 of the 1993 Form 10-K). -
10 (iii) (k) Restated Supplemental Pension Plan. 85-91
10 (iii) (l) Supplemental Stock and Savings Investment
Plan effective as of January 1, 1989. Incorporated by
reference to Form 10-K of Ingersoll-Rand Company for
Fiscal Year Ended December 31, 1993. (See pages 189-198
of the 1993 Form 10-K). -
10 (iii) (m) Supplemental Retirement Account Plan
effective as of January 1, 1989. Incorporated by
reference to Form 10-K of Ingersoll-Rand Company for
Fiscal Year Ended December 31, 1993. (See pages
199-206 of the 1993 Form 10-K). -
24
INGERSOLL-RAND COMPANY
INDEX TO EXHIBITS
(Item 14(a))
(Continued)
Description Page
10 (iii) (n) Incentive Stock Plan of 1995 of Ingersoll-
Rand Company. Incorporated by reference to the Notice
of 1995 Annual Meeting of Shareholders and Proxy
Statement dated March 15, 1995. (See Appendix A of the
Proxy Statement dated March 15, 1995). -
10 (iii) (o) Senior Executive Performance Plan.
Incorporated by reference to the Notice of 1995
Annual Meeting of Shareholders and Proxy Statement
dated March 15, 1995. (See Appendix B of the Proxy
Statement dated March 15, 1995). -
10 (iii) (p) Elected Officers Supplemental Plan. 92-108
10 (iii) (q) Selected Executive Officer Employment
Agreement. 109-111
11 (i) Computation of Primary Earnings Per Share. 112
11 (ii) Computation of Fully Diluted Earnings Per Share. 113-114
12 Computations of Ratios of Earnings to Fixed Charges. 115
13 Ingersoll-Rand Company Annual Report to
Shareowners for 1995. (Not deemed to be filed as
part of this report except to the extent incorporated
by reference). 116-175
18 Letter dated August 11, 1995 from Price Waterhouse
LLP regarding change in accounting method. Incorporated
by reference to Form 10-Q of Ingersoll-Rand Company for
the quarterly period ended June 30, 1995 reported under
Item 6, Exhibits.
21 List of Subsidiaries of Ingersoll-Rand Company. 176-178
27 Financial Data Schedule. 179
25
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
INGERSOLL-RAND COMPANY
(Registrant)
By /S/ Thomas F. McBride
Thomas F. McBride
Senior Vice President and
Chief Financial Officer
Date March 29, 1996
Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on
the dates indicated.
Signature Title Date
Chairman, President,
Chief Executive Officer
and Director (Principal
/S/ James E. Perrella Executive Officer) March 29, 1996
(James E. Perrella)
Senior Vice President
Chief Financial Officer
(Principal Financial
/S/ Thomas F. McBride Officer) March 29, 1996
(Thomas F. McBride)
Controller -
Accounting and Reporting
(Principal Accounting
/S/ Richard A. Spohn Officer) March 29, 1996
(Richard A. Spohn)
/S/ Theodore H. Black Director March 29, 1996
(Theodore H. Black)
26
Signature Title Date
/S/ Brendan T. Byrne Director March 29, 1996
(Brendan T. Byrne)
/S/ Joseph P. Flannery Director March 29, 1996
(Joseph P. Flannery)
/S/ Constance J. Horner Director March 29, 1996
(Constance J. Horner)
/S/ H. William Lichtenberger Director March 29, 1996
(H. William Lichtenberger)
/S/ John E. Phipps Director March 29, 1996
(John E. Phipps)
/S/ Cedric E. Ritchie Director March 29, 1996
(Cedric E. Ritchie)
/S/ Orin R. Smith Director March 29, 1996
(Orin R. Smith)
/S/ Richard J. Swift Director March 29, 1996
(Richard J. Swift)
27