1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10 - Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 1998
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 1-7951
WICOR, Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Wisconsin 39-1346701
------------------------------- ------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
626 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
--------------------------------------- ----------
(Address of principal executive office) (Zip Code)
(414) 291-7026
----------------------------------------------------
(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
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 17, 1998
- -------------------------- -------------------------------
Common Stock, $1 Par Value 37,331,232
2
INTRODUCTION
WICOR, Inc. ("WICOR" or the "Company") is a diversified holding company
with two principal business groups: an Energy Group responsible for natural
gas distribution and related services, and a Manufacturing Group
responsible for the manufacture of pumps and processing equipment used to
pump, control, transfer, hold and filter water and other fluids. The
Company engages in natural gas distribution through its subsidiary,
Wisconsin Gas Company ("Wisconsin Gas"), the oldest and largest natural gas
distribution utility in Wisconsin. Through several nonutility subsidiaries,
the Company also engages in the manufacture and sale of pumps and
processing equipment. The Company's manufactured products primarily have
water system, pool and spa, agricultural, RV/marine and beverage/food
service applications. The Company markets its manufactured products in
about 100 countries. The Company is incorporated under the laws of the
State of Wisconsin and is exempt from registration as a holding company
under the Public Utility Holding Company Act of 1935, as amended.
CONTENTS
PAGE
PART I.
Financial Information 1
Management's Discussion and Analysis of
Interim Financial Statements 2-5
Consolidated Financial Statements of WICOR, Inc. (Unaudited):
Consolidated Statements of Operation for the
Three and Six Months Ended June 30, 1998 and 1997 6
Consolidated Balance Sheets as of
June 30, 1998 and December 31, 1997 7-8
Consolidated Statements of Cash Flows for the
Six Months Ended June 30, 1998 and 1997 9
Notes to Consolidated Financial Statements 10
PART II.
Other Information and Exhibits 11-12
Signatures 13
3
Part I - Financial Information
Financial Statements
--------------------
The consolidated statements included herein have been prepared without
audit pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules
and regulations, although management believes that the disclosures are
adequate to make the information presented not misleading. These condensed
financial statements should be read in conjunction with the audited
financial statements and the notes thereto included in the WICOR, Inc.
Annual Report on Form 10-K for the year ended December 31, 1997.
In the opinion of management, the information furnished reflects all
adjustments, which in all circumstances were normal and recurring,
necessary for a fair presentation of the results of operations for the
interim periods.
Because of seasonal factors, the results of operations for the interim
periods presented are not necessarily indicative of the results to be
expected for the full calendar year.
Forward-Looking Statements
- --------------------------
Certain matters discussed in this report are "forward-looking statements"
intended to qualify for the safe harbor from liability established by the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements generally can be identified as such because they include words
such as the Company "believes," "anticipates," "expects," or words of
similar import. Similarly, statements that describe the Company's future
plans, objectives or goals also are considered forward-looking. Such
statements are subject to certain risks and uncertainties that could cause
actual results to differ materially from current expectations. These
factors include but are not limited to the risks and uncertainties listed
below. All of these factors are difficult to predict and generally beyond
management's control.
>> the impact of warmer- or colder-than-normal weather on the energy
business
>> the impact of cool or wet weather on the pump manufacturing markets
>> economic conditions, including the availability of individual
discretionary income and changes in interest rates and foreign currency
valuations
>> changes in natural gas prices and supply availability
>> increased competition in deregulated energy markets
>> the pace and extent of energy industry deregulation
>> regulatory, government and court decisions
>> increases in costs to clean up environmental contamination
>> the Company's ability to increase prices
>> market demand for the Company's products and services
4
Management's Discussion and Analysis
of Interim Financial Statements of
WICOR, Inc.
Results of Operations
- ---------------------
Consolidated net earnings for the three months ended June 30, 1998
decreased by $0.3 million, or 5%, to $6.0 million. Consolidated net
earnings for the six months ended June 30, 1998 decreased by $3.2 million,
or 9%, to $31.0 million. The decrease in the three and six month periods
is attributable to lower Energy Group earnings. Increased earnings within
the Manufacturing Group partially offset these decreases.
The following factors had a significant effect on the results of operations
during the three- and six-month periods ended June 30, 1998.
Energy Group
- ------------
The Energy Group incurred a net loss of $1.8 million in the second quarter
of 1998 compared with earnings of $0.2 million for the second quarter of
1997. Net earnings for the six months ended June 30, 1998, decreased by
$6.4 million, or 27%, to $17.7 million compared to $24.1 million for the
same period of last year.
The decline in net earnings for the three and six months ended June 30,
1998 resulted from decreased gas margins which were partially offset by
lower operating and maintenance expenses. The lower gas margins were
driven by a combination of warm winter weather and a voluntary $1.5 million
annual rate reduction effective November 1, 1997. The effect of these
items was partially offset by a gain related to a weather insurance
agreement which was recorded in the first quarter of 1998.
Revenues, margins and volumes are summarized below. Margin, defined as
revenues less cost of gas sold, is a better performance indicator than
revenues because the mix of utility volumes between sales and
transportation service affects revenues but not margin. In addition,
changes in the cost of gas sold are substantially flowed through to revenue
for Wisconsin Gas under a gas adjustment clause. The following tables set
forth margin data for the Energy Group and volume data for the utility for
each of the three- and six-month periods ended June 30 set forth below.
5
Three Months Six Months
Ended June 30, Ended June 30,
----------------- % ----------------- %
1998 1997 Change 1998 1997 Change
(Millions of Dollars) -------- -------- ------ -------- -------- ------
- --------------------
Energy Revenues $ 85.5 $ 100.9 (15) $ 265.4 $ 337.9 (21)
Cost of Gas Sold 56.1 68.0 (17) 171.5 232.4 (26)
-------- -------- -------- --------
Sales Margin 29.4 32.9 (11) 93.9 105.5 (11)
Gas Transportation Margin 4.7 5.0 (6) 11.9 11.7 2
-------- -------- -------- --------
Gross Margin 34.1 37.9 (10) 105.8 117.2 (10)
Operation and Maintenance 24.0 24.8 (3) 51.8 52.5 (1)
Depreciation/Amortization 8.3 7.9 5 16.7 15.5 8
Interest and Other 2.5 2.6 (4) 4.4 5.5 (20)
Taxes, Other Than Income Tax 2.2 2.2 - 4.8 4.8 -
-------- -------- -------- --------
(Loss) Income Before
Income Taxes (2.9) 0.4 N.A. 28.1 38.9 (28)
Income Tax (Benefit) Expense (1.1) 0.2 N.A. 10.4 14.8 (30)
-------- -------- -------- --------
Net (Loss) Earnings $ (1.8) $ 0.2 N.A. $ 17.7 $ 24.1 (27)
======== ======== ======== ========
Three Months Six Months
Ended June 30, Ended June 30,
----------------- % ----------------- %
1998 1997 Change 1998 1997 Change
-------- -------- ------ -------- -------- ------
(Millions of Therms)
- --------------------
Utility Sales Volumes
Firm 95.4 127.4 (25) 397.1 488.8 (19)
Interruptible 8.0 13.8 (42) 22.0 47.9 (54)
Transportation Volume 99.0 98.2 1 237.0 221.1 7
-------- -------- -------- --------
Total Throughput 202.4 239.4 (15) 656.1 757.8 (13)
======== ======== ======== ========
Degree Days
- -----------
Actual 895 1,215 (26) 3,810 4,530 (16)
======== ======== ======== ========
20 year average 950 4,384
======== ========
6
The decrease in firm sales volumes for the three and six months
ended June 30, 1998 was caused principally by warmer weather,
lower average use per residential customer and firm sales
customers switching to transportation. The weather for the three
and six months ended June 30, 1998 was 6% and 13% warmer,
respectively, than the 20-year average. For both periods,
transportation volumes increased mainly because more customers
purchased gas from sources other than Wisconsin Gas and
transported the volumes over the Wisconsin Gas distribution
system. Historically, customers transferring to transportation
from gas sales had no impact on margin. However, effective
November 1, 1997, a slightly lower margin rate was put into
effect for transportation-only customers. The future impact of
this margin adjustment on total Company earnings is expected to
be immaterial.
The gas cost incentive mechanism ("GCIM") approved by the Public
Service Commission of Wisconsin ("PSCW") in October 1997, became
effective on November 1, 1997 for each of the three years ending
October 31, 1998, 1999 and 2000. Under the GCIM, Wisconsin Gas's
gas commodity and capacity costs are compared to monthly
benchmarks. If, at the end of each GCIM year, such costs deviate
by more than 1-1/2% from the benchmark cost of gas, the utility
shares such excess or reduced costs on a 50-50 basis with
customers. The sharing mechanism applies only to costs between
1-1/2% to 4% above or below the benchmark. The new GCIM provides
an opportunity for Wisconsin Gas's earnings to increase or
decrease as a result of gas and capacity acquisition activities.
Management believes that Wisconsin Gas and its customers will
share in reduced gas costs as a result of the GCIM.
Non-regulated Energy Group revenues for the first six months of
1998 remained relatively level at $29.6 million compared to the
same period of 1997. The Company's strategy in the gas marketing
area is to have gas supply arrangements closely tied to customer
requirements so that the Company is not exposed to significant
commodity price risk.
Operating and maintenance expenses decreased slightly during the
three and six months ended June 30, 1998, compared to comparable
periods in 1997. Lower expenses at the utility during both
periods were partially offset by higher non-utility expenses
associated with increased operating activities of FieldTech, Inc.
Depreciation expense for the three and six months ended June 30,
1998, increased by $0.4 million and $1.2 million, respectively,
as compared with the comparable periods of 1997. The increase in
both periods in 1998 was due to increases in depreciable plant
balances.
7
Manufacturing
- -------------
Manufacturing net earnings for the three and six months ended
June 30, 1998 increased to $7.8 million and $13.3 million,
respectively, as compared with $6.1 million and $10.1 million for
the same periods in 1997, respectively.
Three Months Six months
Ended June 30, Ended June 30,
----------------- % ----------------- %
(Millions of Dollars) 1998 1997 Change 1998 1997 Change
-------- -------- ------ -------- -------- ------
Net Sales $ 129.6 $ 115.7 12 $ 245.9 $ 221.0 11
Cost of goods sold 91.9 83.0 11 174.8 160.1 9
-------- -------- -------- --------
Gross profit 37.7 32.7 15 71.1 60.9 17
Operating expenses 23.3 21.3 9 46.6 42.1 11
-------- -------- -------- --------
Operating income 14.4 11.4 26 24.5 18.8 30
Interest expense and other 1.5 1.5 - 2.6 2.8 (7)
-------- -------- -------- --------
Net income before income taxes 12.9 9.9 30 21.9 16.0 37
Income taxes 5.1 3.8 34 8.6 5.9 46
-------- -------- -------- --------
Net earnings $ 7.8 $ 6.1 28 $ 13.3 $ 10.1 32
======== ======== ======== ========
Domestic sales in the second quarter increased to $90.0 million, which is
20% over the comparable period of 1997. Overall shipments to the water
systems and pool/spa markets in North America were up from last year's
comparable period. The increase is attributable to customer base growth,
new product market penetration and generally favorable economic and weather
conditions in the United States. Domestic sales for the six months ended
June 30, 1998 increased $24.2 million to $169.8 million.
International sales for the second quarter decreased by 3% to $39.6 million
compared to $40.6 million in the second quarter of 1997. A strengthening
U.S. dollar and a downturn in the Asian economy continued to adversely
affect sales. On a year to date basis, international sales increased by 1%
over the same period in 1997. For the six months ended June 30, 1998 and
1997, international sales accounted for 31% and 34%, respectively, of total
net sales for the Manufacturing Group.
Gross profit margins for the three and six months ended June 30, 1998
improved to 29.1% and 28.9%, respectively, as compared with 28.2% and 27.6%
in the same periods of 1997, respectively. Plant consolidations positively
impacted gross profit during the periods. Operating expenses, as a
percentage of sales, for the six months ended June 30, 1998 decreased
slightly compared to the same period in 1997 due to higher sales levels
8
Operating expenses in total increased by 11% due in part to the impact of
higher support spending for product line acquisitions, market introductions
of new products and customer development.
Non-Operating Income and Income Taxes
- -------------------------------------
Interest expense remained relatively flat for the three and six months
ended June 30, 1998 compared to the similar periods of 1997.
Income tax expense was $1.7 million lower for the first six months of 1998,
compared to the same period last year, reflecting decreased pre-tax income.
Financial Condition
- -------------------
Cash flow from operations for the six months ended June 30, 1998 increased
by $36.0 million, or 40%, to $126 million from the comparable period in
1997. Due to the seasonal nature of the energy business, accrued revenues,
accounts receivable and accounts payable amounts are higher in the heating
season as compared with the summer months.
Capital expenditures were level for the six months ended June 30, 1998
compared to the same period in 1997. The Company believes that its cash
flows from operations will be sufficient to satisfy its future capital
expenditures.
Additional short-term borrowing will be needed during the third and fourth
quarters of 1998 to finance working capital primarily related to gas
purchased for injection into storage and accounts receivable. The Company
has existing lines of credit to satisfy these working capital needs.
During the fourth quarter of 1998, Wisconsin Gas plans to refinance $40
million of existing debt due in November, 1998.
On July 28, 1998, the Board of Directors of the Company authorized an
increase in the Company's dividend per share on common stock to $0.22 per
quarter ($0.88 per share on an annualized basis). The first quarterly
payment at the new rate will be made August 31, 1998, to shareholders of
record on August 10, 1998.
9
Regulatory Matters
- ------------------
On May 7, 1998, the PSCW approved a Company proposal to change WICOR's
nonutility investment limitation to no more than 60% of its total
capitalization. In addition, the PSCW found that the utility did not have
to be WICOR's predominant investment as long as the utility is adequately
insulated from nonutility activities and continues to offer high quality
service at reasonable rates. To monitor these conditions, the PSCW
determined that Wisconsin Gas must maintain at least a single-A bond rating
and maintain the standards imposed in the 1993 order that established the
Productivity-based Alternative Ratemaking Mechanism ("PARM"). Under these
new restrictions, the amount available to WICOR for future nonutility
investment at December 31, 1997 would have been $370 million.
On July 10, 1998, the Company filed with the PSCW to increase rates within
the framework of PARM. The new rates, which are effective August 1, 1998,
are expected to increase revenues $7.5 million on an annualized basis and
are expected to offset increased operating expenses.
New Accounting Standards
- ------------------------
In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standard No. 133 (SFAS No. 133), "Accounting for
Derivative Instruments and Hedging Activities", effective in the first
quarter of 2000. SFAS No. 133 establishes accounting and reporting
standards for derivative instruments, including certain derivative
instruments embedded in other contracts and for hedging activities. It
requires that an entity recognize all derivatives as either assets or
liabilities in the balance sheet and measure those instruments at fair
value. The Company is currently evaluating the impact of the provisions of
SFAS No. 133 on its financial statements. However, SFAS No. 133 could
increase volatility in earnings and other comprehensive income.
The American Institute of Certified Public Accountants Statement of
Position No. 98-1, "Accounting for the Costs of Computer Software Developed
or Obtained for Internal Use," provides guidance on accounting for the
costs of computer software developed or obtained for internal use. The
Company is currently evaluating the impact the statement will have on its
financial statements, if any.
Other
- -----
On June 25, 1998, four energy companies unveiled plans to build a new 150-
to 200-mile pipeline from the Chicago area into southeastern Wisconsin.
Although there is no assurance that the pipeline will ultimately be
constructed, the Company believes that a new pipeline from Chicago to
southeastern Wisconsin would be an important new source of natural gas
capacity that could lower prices for Wisconsin consumers. The project is
subject to Federal as well as various state approvals.
10
WICOR, INC.
Consolidated Statements of Operation (Unaudited)
(Amounts in Thousands, Except Per Share Data)
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- ----------------------
1998 1997 1998 1997
---------- ---------- ---------- ----------
Operating Revenues:
Energy $ 90,261 $ 105,923 $ 277,264 $ 349,654
Manufacturing 129,618 115,682 245,942 221,016
---------- ---------- ---------- ----------
219,879 221,605 523,206 570,670
---------- ---------- ---------- ----------
Operating Costs and Expenses:
Cost of gas sold 56,149 67,993 171,498 232,414
Manufacturing cost of sales 91,913 83,043 174,818 160,087
Operations and maintenance 47,033 45,716 97,770 93,939
Depreciation and amortization 8,667 8,200 17,404 16,139
Taxes, other than income taxes 2,213 2,226 4,827 4,785
---------- ---------- ---------- ----------
205,975 207,178 466,317 507,364
---------- ---------- ---------- ----------
Operating Income 13,904 14,427 56,889 63,306
---------- ---------- ---------- ----------
Interest Expense (3,931) (3,937) (8,585) (8,375)
Other Income and (Expenses) (17) (160) 1,666 12
---------- ---------- ---------- ----------
Income Before Income Taxes 9,956 10,330 49,970 54,943
Income Tax Provision 3,932 4,015 18,983 20,720
---------- ---------- ---------- ----------
Net Earnings $ 6,024 $ 6,315 $ 30,987 $ 34,223
========== ========== ========== ==========
Per Share of Common Stock:
Basic earnings $ 0.16 $ 0.17 $ 0.83 $ 0.93
Diluted earnings $ 0.16 $ 0.17 $ 0.82 $ 0.92
Cash Dividends paid $ 0.215 $ 0.210 $ 0.430 $ 0.420
Average shares outstanding 37,312 36,844 37,277 36,836
Average diluted shares outstanding 37,612 37,078 37,618 37,070
The accompanying notes are an integral part of these statements.
11
WICOR, INC.
Consolidated Balance Sheets
June 30,
1998 December 31,
(Unaudited) 1997
Assets ----------- ------------
- ------ (Thousands of Dollars)
Current Assets:
Cash and cash equivalents $ 10,565 $ 11,810
Accounts receivable, less allowance
for doubtful accounts of $17,468
and $15,364, respectively 147,495 164,243
Accrued utility revenues 9,933 44,842
Manufacturing inventories 79,956 83,431
Gas in storage, at weighted average cost 23,812 41,887
Deferred income taxes 21,510 21,531
Prepayments and other 16,788 16,924
----------- ------------
310,059 384,668
Property, Plant and Equipment (less accum- ----------- ------------
ulated depreciation of $515,888
and $497,239, respectively) 441,105 445,894
----------- ------------
Deferred Charges and Other:
Regulatory assets 61,645 53,910
Goodwill 65,045 65,953
Prepaid pension costs 46,563 42,753
Systems development costs 15,051 17,424
Other 19,889 20,730
----------- ------------
208,193 200,770
----------- ------------
$ 959,357 $ 1,031,332
=========== ============
The accompanying notes are an integral part of these statements.
12
WICOR, INC.
Consolidated Balance Sheets
(continued)
June 30,
1998 December 31,
(Unaudited) 1997
Liabilities and Capitalization ------------ ------------
- ------------------------------ (Thousands of Dollars)
Current Liabilities:
Short-term borrowings $ 25,937 $ 118,900
Accounts payable 72,724 75,034
Current portion of long-term debt 43,667 43,926
Refundable gas costs 37,906 24,776
Accrued payroll and benefits 19,606 17,573
Accrued taxes 11,393 9,684
Other 17,937 19,999
------------ ------------
229,170 309,892
------------ ------------
Deferred Credits and Other:
Postretirement benefit obligation 62,699 64,323
Regulatory liabilities 33,911 36,533
Deferred income taxes 44,357 43,975
Accrued environmental remediation costs 9,695 12,084
Unamortized investment tax credit 6,473 6,808
Other 19,049 18,987
------------ ------------
176,184 182,710
------------ ------------
Capitalization:
Long-term debt 149,042 149,110
Common stock 37,330 37,202
Other paid-in capital 215,994 214,101
Retained earnings 162,857 147,903
Accumulated other comprehensive income (6,983) (5,377)
Unearned compensation - ESOP
and restricted stock (4,237) (4,209)
------------ ------------
554,003 538,730
------------ ------------
$ 959,357 $ 1,031,332
============ ============
The accompanying notes are an integral part of these statements.
13
WICOR, INC.
Consolidated Statement of Cash Flows (Unaudited)
Six Months Ended
June 30,
-----------------------
(Thousands of Dollars) 1998 1997
---------- ----------
Operations:
Net earnings $ 30,987 $ 34,223
Adjustments to reconcile net
earnings to net cash flows:
Depreciation and amortization 27,813 27,134
Deferred income taxes 403 169
Change in:
Receivables 41,657 41,434
Manufacturing inventories 3,474 2,580
Gas in storage 18,074 10,645
Other current assets (656) (1,591)
Accounts payable (2,310) (27,636)
Refundable gas costs 13,131 5,594
Accrued taxes 2,502 8,109
Other current liabilities (25) (2,918)
Other non-current assets
and liabilities, net (9,068) (7,730)
---------- ----------
125,982 90,013
Investment Activities: ---------- ----------
Capital expenditures (20,466) (20,292)
Acquisition of business assets - (477)
Other 163 183
---------- ----------
(20,303) (20,586)
Financing Activities: ---------- ----------
Change in short-term borrowings (92,963) (60,499)
Reduction in long-term debt (2,782) (3,395)
Issuance of long-term debt 2,828 -
Issuance of common stock 2,022 1,965
Dividends paid on common stock (16,029) (15,468)
---------- ----------
(106,924) (77,397)
---------- ----------
Change in Cash and Equivalents (1,245) (7,970)
Cash and equivalents at Beginning of Period 11,810 18,784
---------- ----------
Cash and Equivalents at End of Period $ 10,565 $ 10,814
=========== ==========
The accompanying notes are an integral part of these statements.
14
Notes to Consolidated Financial Statements (Unaudited):
1) The Company and its subsidiaries maintain lines of credit worldwide.
At June 30, 1998 the Company had borrowings of $25.9 million and
availability of $181.5 million under unsecured lines of credit with several
banks.
A total of $9.1 million of commercial paper, classified as short-term debt,
was outstanding as of June 30, 1998 at a weighted average interest rate of
5.7%.
2) For purposes of the Consolidated Statements of Cash Flows, income taxes
paid, net of refunds, and interest paid (excluding capitalized interest)
were as follows:
For the Six Months
Ended June 30,
----------------------
1998 1997
---------- ----------
(Thousands of Dollars)
Income taxes paid $ 18,345 $ 13,582
Interest paid $ 8,552 $ 8,754
3) Total comprehensive income for the six months ended June 30, 1998 and
1997 is as follows:
1998 1997
---------- ----------
(Thousands of Dollars)
Net earnings $ 30,987 $ 34,223
Other comprehensive income
Currency translation adjustments (1,609) (2,584)
---------- ----------
Total comprehensive income $ 29,378 $ 31,639
========== ==========
4) On April 23, 1998, the Board of Directors approved a two-for-one stock
split of the Company's common stock to be effected by the distribution of
one additional share for each share outstanding. Such distribution was
made on May 29, 1998 to shareholders of record as of the close of business
on May 14, 1998. The par value of the common stock remained unchanged at
$1.00. In connection with the stock split, WICOR increased its authorized
shares of common stock from 60 million to 120 million. All references to
the number of common shares and per share amounts in the consolidated
financial statements have been restated to reflect the effect of the stock
split.
15
Part II - Other Information
- ---------------------------
Item 4. Submission of Matters to a Vote of Security Holders
- -----------------------------------------------------------
At the Company's annual meeting of shareholders held on April 23, 1998,
Wendell F. Bueche, Daniel F. McKeithan, Jr., George E. Wardeberg and Essie
M. Whitelaw were elected as directors of the Company for terms expiring in
2001. The following table sets forth certain information with respect to
the election of directors at the annual meeting:
Shares Withholding
Name of Nominee Shares Voted For Authority
- ------------------------ ---------------- ------------------
Wendell F. Bueche 31,840,771 577,704
Daniel F. McKeithan, Jr. 31,714,726 544,520
George E. Wardeberg 31,716,116 543,130
Essie M. Whitelaw 31,698,296 560,950
The following table sets forth the other directors of the Company whose
terms of office continued after the 1998 annual meeting:
Year in Which
Name of Director Term Expires
- ------------------------ --------------
Jere D. McCaffey 1999
Thomas F. Schrader 1999
Stuart W. Tisdale 1999
Willie D. Davis 2000
Guy A. Osborn 2000
William B. Winter 2000
At the Company's annual meeting of shareholders held on April 23, 1998, the
1994 Long-Term Performance Plan (the "Plan"), as amended, was approved.
The following table sets forth certain information with respect to the
approval of the Plan:
Shares Voted For Shares Voted Against Shares Abstaining
- ---------------- -------------------- -----------------
28,304,168 3,339,040 616,038
Item 5. Other Information
- -------------------------
James J. Monnat was named treasurer of WICOR effective May 1, 1998.
Thomas M. Rettler was named vice president of corporate development and
planning effective May 1, 1998.
16
The deadline for submission of shareholder proposals pursuant to Rule 14a-8
under the Securities Exchange Act of 1934, as amended, for inclusion in the
Company's proxy statement for its 1999 Annual Meeting of Shareholders is
November 13, 1998. Additionally, if the Company receives notice of a
shareholder proposal after January 26, 1999, the persons named in proxies
solicited by the Board of Directors of the Company for its 1999 Annual
Meeting of Shareholders may exercise discretionary voting power with
respect to such proposal.
17
Item 6. Exhibits and Reports on Form 8-K
- ----------------------------------------
a) Exhibits
3.1 WICOR, Inc. Restated Articles of Incorporation, as amended.
10.1 WICOR, Inc. 1994 Long-Term Performance Plan, as amended.
27 Financial data schedule (EDGAR version only).
b) Reports on Form 8-K - There were no reports on Form 8-K filed by the
Company during the second quarter of 1998.
18
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.
WICOR, INC.
Dated: July 31, 1998 By: /s/ Joseph P. Wenzler
----------------------------
Joseph P. Wenzler
Senior Vice President and
Chief Financial Officer
19
WICOR, Inc.
FORM 10-Q Exhibit
Exhibit No. Description
- ----------- ----------------------------------------------------------
3.1 WICOR, Inc. Restated Articles of Incorporated, as amended.
10.1 WICOR, Inc. 1994 Long-Term Performance Plan, as amended.
27 Financial data schedule (EDGAR version only)