PAGE 1
UNITED STATES 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 SEPTEMBER 30, 1995
( ) 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 1-8339
NORFOLK SOUTHERN CORPORATION
- ----------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Virginia 52-1188014
- ---------------------------------------- --------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
Three Commercial Place
Norfolk, Virginia 23510-2191
- ---------------------------------------- --------------------------------
(Address of principal executive offices) Zip Code
Registrant's telephone number, including area code (804) 629-2680
------------------------
No Change
- ----------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report.)
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. (X) Yes ( ) No
The number of shares outstanding of each of the registrant's classes of
Common Stock, as of the last practicable date:
Class Outstanding as of October 31, 1995
----- ----------------------------------
Common Stock (par value $1.00) 129,768,492 shares (excluding
7,252,634 shares held by
registrant's consolidated
subsidiaries)
PAGE 2
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES (NS)
INDEX
-----
Page
----
Part I. Financial Information:
Item 1. Consolidated Statements of Income
Three Months and Nine Months Ended
September 30, 1995 and 1994 3
Consolidated Balance Sheets
September 30, 1995, and December 31, 1994 4
Consolidated Statements of Cash Flows
Nine Months Ended September 30, 1995 and 1994 5
Notes to Consolidated Financial Statements 6-7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8-13
Part II. Other Information:
Item 6. Exhibits and Reports on Form 8-K 14
Signatures 15
Index to Exhibits 16
PAGE 3
PART I. FINANCIAL INFORMATION
------------------------------
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
Consolidated Statements of Income
(In millions of dollars except per share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
-------- -------- -------- --------
TRANSPORTATION OPERATING REVENUES:
Railway:
Coal $ 318.5 $ 325.0 $ 930.1 $ 952.4
Merchandise 647.3 622.7 1,994.7 1,880.7
Other 30.2 28.1 86.8 82.8
-------- -------- -------- --------
Total railway 996.0 975.8 3,011.6 2,915.9
Motor carrier 187.9 195.4 501.2 493.5
-------- -------- -------- --------
Total operating revenues 1,183.9 1,171.2 3,512.8 3,409.4
-------- -------- -------- --------
TRANSPORTATION OPERATING EXPENSES:
Railway:
Compensation and benefits 359.7 340.4 1,091.6 1,033.5
Materials, services and rents 146.7 160.2 472.5 486.5
Depreciation 98.3 95.1 289.4 283.4
Diesel fuel 45.2 47.3 140.9 139.7
Casualties and other claims 30.7 36.4 91.7 103.0
Other 37.7 32.5 114.1 109.0
-------- -------- -------- --------
Total railway 718.3 711.9 2,200.2 2,155.1
Motor carrier 173.5 181.8 481.3 476.2
-------- -------- -------- --------
Total operating expenses 891.8 893.7 2,681.5 2,631.3
-------- -------- -------- --------
Income from operations 292.1 277.5 831.3 778.1
Other income (expense):
Interest income 6.9 7.4 21.7 18.7
Interest expense on debt (28.8) (27.5) (85.7) (75.2)
Other - net 16.9 8.7 87.4 48.3
-------- -------- -------- --------
Total other income (expense) (5.0) (11.4) 23.4 (8.2)
-------- -------- -------- --------
Income before income taxes 287.1 266.1 854.7 769.9
Provision for income taxes 103.2 97.8 318.9 278.2
-------- -------- -------- --------
NET INCOME $ 183.9 $ 168.3 $ 535.8 $ 491.7
======== ======== ======== ========
Per share amounts (Note 5):
Net income $ 1.40 $ 1.24 $ 4.07 $ 3.59
Dividends 0.52 0.48 1.56 1.44
See accompanying notes to consolidated financial statements.
PAGE 4
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
(In millions of dollars)
(Unaudited)
September 30, December 31,
1995 1994
------------ ------------
ASSETS
Current assets:
Cash and cash equivalents $ 73.2 $ 57.0
Short-term investments 214.1 249.7
Accounts receivable - net 773.8 726.6
Materials and supplies 63.1 61.9
Deferred income taxes 138.3 137.0
Other current assets 77.8 105.3
--------- ---------
Total current assets 1,340.3 1,337.5
Investments 231.2 172.8
Properties less accumulated depreciation 9,233.1 8,987.1
Other assets 68.3 90.4
--------- ---------
TOTAL ASSETS $10,872.9 $10,587.8
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term debt $ 43.1 $ 44.9
Accounts payable 720.5 704.1
Income and other taxes 211.0 168.5
Other current liabilities 147.0 142.3
Current maturities of long-term debt (Note 3) 59.3 72.0
--------- ---------
Total current liabilities 1,180.9 1,131.8
Long-term debt (Note 3) 1,588.3 1,547.8
Other liabilities 984.8 961.9
Minority interests 52.2 53.5
Deferred income taxes 2,258.6 2,208.0
--------- ---------
TOTAL LIABILITIES 6,064.8 5,903.0
--------- ---------
Stockholders' equity:
Common stock $1.00 per share par value 137.4 140.4
Other capital 424.5 410.4
Retained income 4,266.8 4,154.6
Less treasury stock at cost, 7,252,634 shares (20.6) (20.6)
--------- ---------
TOTAL STOCKHOLDERS' EQUITY 4,808.1 4,684.8
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $10,872.9 $10,587.8
========= =========
See accompanying notes to consolidated financial statements.
PAGE 5
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(In millions of dollars)
(Unaudited)
Nine Months Ended
September 30,
1995 1994
-------- --------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 535.8 $ 491.7
Reconciliation of net income to net cash
provided by operating activities:
Special charge payments (9.6) (30.2)
Depreciation 308.1 305.7
Deferred income taxes 44.7 68.3
Nonoperating gains and losses on properties
and investments (56.8) (13.1)
Changes in assets and liabilities affecting
operations:
Accounts receivable (42.2) (43.6)
Materials and supplies (1.2) 4.6
Other current assets 27.5 16.2
Current liabilities other than debt 91.5 54.6
Other - net 16.4 2.8
-------- --------
Net cash provided by operating activities 914.2 857.0
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions (Note 3) (497.6) (491.9)
Property sales and other transactions 80.8 53.4
Investments and loans (54.5) (44.5)
Investment sales and other transactions 24.6 260.1
Short-term investments - net 38.6 (143.3)
-------- --------
Net cash used for investing activities (408.1) (366.2)
CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends (205.9) (197.9)
Common stock issued - net 10.6 9.4
Purchase and retirement of common stock (238.6) (179.0)
Proceeds from long-term borrowings (Note 3) 7.6 41.4
Debt repayments (63.6) (108.7)
-------- --------
Net cash used for financing activities (489.9) (434.8)
-------- --------
Net increase in cash and cash equivalents 16.2 56.0
CASH AND CASH EQUIVALENTS:*
At beginning of year 57.0 80.5
-------- --------
At end of period $ 73.2 $ 136.5
======== ========
- ----------------------------------------------------------------------------
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the period for:
Interest (net of amounts capitalized) $ 100.7 $ 93.3
Income taxes $ 219.3 $ 154.3
* Cash equivalents are highly liquid investments purchased three months or
less from maturity.
See accompanying notes to consolidated financial statements.
PAGE 6
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
1. In the opinion of Management, the accompanying unaudited interim
financial statements contain all adjustments (consisting of normal
recurring accruals) necessary to present fairly the financial
position as of September 30, 1995, and the results of operations and
cash flows for the nine months ended September 30, 1995, and 1994.
While Management believes that the disclosures presented are adequate
to make the information not misleading, these consolidated financial
statements should be read in conjunction with the financial
statements and notes included in the Corporation's latest Annual
Report on Form 10-K.
2. Contingencies
There have been no significant changes since year-end 1994 in the
matters as discussed in Note 17, CONTINGENCIES, appearing in the NS
Annual Report on Form 10-K for 1994, Notes to Consolidated Financial
Statements, beginning on page 72.
3. Capital Leases
During the first quarter of 1995, an NS rail subsidiary entered into
capital leases covering new locomotives. The related capital lease
obligations totaling $104.5 million were reflected in the
Consolidated Balance Sheet as debt and, because they were non-cash
transactions, were excluded from the Consolidated Statement of Cash
Flows. The lease obligations carry stated interest rates between
8.23 percent and 8.60 percent but were converted to variable rate
obligations using interest rate swap agreements. The interest rates
on these obligations are based on the six-month London Interbank
Offered Rate and are reset every six months with realized gains or
losses accounted for as an adjustment of interest expense over the
terms of the leases. As a result, NS is exposed to the market risk
associated with fluctuations in interest rates. To date, while such
rate fluctuations have been nominal, their effects have been
favorable.
4. Stock Purchase Programs
Since 1987, the Board of Directors has authorized the purchase and
retirement of up to 65 million shares of NS common stock. Purchases
under the programs have been made with a combination of internally
generated cash and through the issuance of debt. Since the first
purchases in December 1987 through September 30, 1995, NS has
purchased and retired 62,638,800 shares of its common stock under
these programs at a cost of approximately $2.8 billion. Future
purchases are dependent on market conditions, the economy, cash needs
and alternative investment opportunities.
PAGE 7
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
5. Earnings Per Share
"Earnings per share" is computed by dividing net income by the
weighted average number of common shares outstanding as follows:
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
---- ---- ---- ----
(In thousands)
Average number of
shares outstanding 130,578 135,992 131,532 137,105
Recent decreases in the average number of shares outstanding of NS
common stock are the result of the stock purchase program described
in Note 4.
PAGE 8
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition
and Results of Operations
RESULTS OF OPERATIONS
Net Income
- ----------
"Net income" for the third quarter was $183.9 million, the highest for
any quarter in NS' history, and $15.6 million, or 9 percent, higher than
in the third quarter of 1994. Contributing to the 1995 third-quarter
record were a $14.6 million increase in "Income from operations" and a
$6.4 million improvement in nonoperating income.
"Net income" of $535.8 million for the nine months ended September 30,
1995, also a record, was up $44.1 million, or 9 percent, over the
comparable period last year. A 7 percent increase in "Income from
operations" and substantially higher nonoperating income, largely due to
the first-quarter gain on the partial redemption of a partnership
interest, were principally responsible for the improvement.
Railway Operating Revenues
- --------------------------
"Railway operating revenues" increased $20.2 million, or 2 percent, in the
third quarter and $95.7 million, or 3 percent, for the nine months ended
September 30, 1995, compared with the same periods last year. The
increases in operating revenues were due to:
Third Quarter First Nine Months
1995 vs. 1994 1995 vs. 1994
Increase (Decrease) Increase (Decrease)
------------------- -------------------
(In millions of dollars)
Traffic volume (carloads) $ 19.8 $ 125.8
Revenue per unit/mix (1.7) (34.1)
Other 2.1 4.0
------- -------
$ 20.2 $ 95.7
======= =======
PAGE 9
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition
and Results of Operations
The principal revenue commodity groups and changes from the prior year
were as follows:
Third Quarter First Nine Months
1995 vs. 1994 1995 vs. 1994
Increase (Decrease) Increase (Decrease)
------------------- -------------------
(In millions of dollars)
Coal $ (6.5) $ (22.3)
Merchandise:
Intermodal 9.2 39.5
Agriculture 6.2 11.9
Paper/forest 5.8 17.6
Automotive 4.8 25.7
Metals/construction 4.3 18.8
Chemicals (5.7) 0.5
Other, principally switching
and demurrage 2.1 4.0
------- -------
$ 20.2 $ 95.7
======= =======
Coal
- ----
The comparative decline in NS' coal revenues, for both the third quarter
and first nine months of 1995, resulted from an overall weakness in
shipments of domestic utility coal. Stockpiles at coal-fired generating
plants had been quite high since the summer of 1994. This summer's
relatively hot weather in NS' service region resulted in stockpiles
beginning to moderate. Export coal shipments continued the improvement
begun during the second quarter, as the economic recovery in Europe
helped to generate a 15 percent increase in third-quarter volume and a
5 percent increase in volume for the first nine months of 1995, compared
with last year.
Looking ahead, the encouraging trends in both the domestic utility and
export markets for coal over NS' lines are expected to continue,
producing moderate traffic growth for the remainder of the year.
PAGE 10
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition
and Results of Operations
Merchandise
- -----------
All merchandise commodity groups (except chemicals in the third quarter)
produced higher revenues compared with last year. The intermodal group
continued to produce the greatest gains, with revenues up $9.2 million,
or 9 percent, for the third quarter, and up $39.5 million, or 13 percent,
for the first nine months. Container traffic posted the largest gains
compared with last year's third quarter, although a softening domestic
economy resulted in somewhat slower growth, compared with the first six
months this year. Strong container shipments and modest improvement in
trailer movements are expected in the fourth quarter.
The agriculture group recorded the second-best revenue increase in the
third quarter, rising $6.2 million, or 8 percent, compared with last
year. Strong demand for grain, increased wheat shipments from NS
sourcing regions and an improved export market combined to produce the
gains. The fourth-quarter outlook is also positive, although this year's
harvest is not expected to match last year's record levels. Revenues in
the paper/forest and metals/construction commodity groups were up
$5.8 million and $4.3 million, or 5 percent, for the quarter, and up
$17.6 million and $18.8 million, or 5 percent and 8 percent,
respectively, for the first nine months. The gains in the paper/forest
group were almost entirely due to higher average revenues per shipment,
as traffic volume was flat for both periods. Higher average revenues
also largely were responsible for the improved results in
metals/construction, although some of the year-to-date gain was due to
greater first-quarter traffic volume. Revenues from automotive traffic
were up $4.8 million, or 5 percent, for the quarter and $25.7 million, or
8 percent, for the first nine months. NS continues to benefit from
improved automotive sales and production in markets it serves.
Automobile traffic is expected to remain ahead of last year, although
projected gains from plants scheduled to come back on line in the fourth
quarter will be somewhat mitigated by retooling downtimes and production
slow-downs at other plants.
Railway Operating Expenses
- --------------------------
"Railway operating expenses" increased $6.4 million, or 1 percent, in the
third quarter of 1995, and $45.1 million, or 2 percent, for the nine-month
period, compared with the same periods last year.
The largest expense increase for the quarter was in "Compensation and
benefits" which rose $19.3 million, or 6 percent. The main factors
contributing to this increase were: (1) higher wage rates; (2) increased
accruals for stock-based compensation, largely a result of the rise in the
market price of NS stock; and (3) higher health care costs for agreement
employees due to the absorption last year of the cash surplus in a multi-
railroad insurance fund.
On September 26, 1995, NS announced a voluntary retirement program for
certain eligible employees, which 272 of the 475 eligible employees
accepted. The charge for this program will be recorded in
fourth-quarter operating expenses. The effects of this program
are expected to produce annual savings of approximately
$16 million.
PAGE 11
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition
and Results of Operations
Third-quarter expenses also saw an increase in "Other" expenses, which
were up $5.2 million, or 16 percent, compared with last year, which had
benefited from favorable sales and use tax settlements. Partially
offsetting these increases were reductions in "Materials, services and
rents" and "Casualties and other claims." "Materials, services and rents"
declined $13.5 million, or 8 percent, due primarily to lower locomotive
and freight car repairs. Greater income from equipment rents related to
the deprescription of car hire and the leasing of locomotives also
contributed to the decline. "Casualties and other claims" was
$5.7 million, or 16 percent, lower due to favorable experience in personal
injury claims.
The increase in year-to-date "Railway operating expenses" also reflected
higher compensation and benefits costs which were up $58.1 million, or
6 percent, for the same reasons mentioned in the discussion about third-
quarter expenses. "Other" expenses rose $5.1 million, or 5 percent,
compared to 1994, which included a favorable sales and use tax adjustment.
The principal decreases in year-to-date railway operating expenses were in
"Materials, services and rents" and "Casualties and other claims."
"Materials, services and rents" declined $14 million, or 3 percent, for
the same reasons mentioned in the third-quarter discussion. "Casualties
and other claims" declined $11.3 million, or 11 percent, reflecting this
year's more favorable personal injury claims experience and lower
environmental claim costs.
Motor Carrier Operating Revenues
- --------------------------------
"Motor carrier operating revenues" declined $7.5 million, or 4 percent,
for the third quarter but were $7.7 million, or 2 percent, ahead for the
first nine months, compared with the same periods last year. The
quarterly decline was primarily a result of sluggish demand in the
Relocation Services Division during what is normally its busiest season
of the year. The year-to-date increase was in the High Value Products
Division, principally due to the recovering economy and increased sales
efforts in the blanketwrap (specialized handling of uncartoned freight)
unit and at the distribution centers.
Motor Carrier Operating Expenses
- --------------------------------
"Motor carrier operating expenses" were $8.3 million, or 5 percent, lower
for the third quarter, but were $5.1 million, or 1 percent, higher for
the nine months, compared with the same periods last year. Both
variances were principally volume-related.
Other Income (Expense)
- ----------------------
"Interest income" was $0.5 million, or 7 percent, lower for the quarter,
but was $3.0 million, or 16 percent, higher for the first nine months. The
year-to-date increase was largely due to higher interest rates.
"Interest expense on debt" increased $1.3 million, or 5 percent, and
$10.5 million, or 14 percent, for the third quarter and year-to-date,
respectively, mainly due to higher rates on commercial paper debt.
PAGE 12
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition
and Results of Operations
"Other-net" improved by $8.2 million over third-quarter 1994 and by
$39.1 million above the first nine months of last year. The improvement
for the quarter was largely due to an increase in gains on sales of
property while the year-to-date increase was largely attributable to a
$30.5 million ($18.8 million after-tax) gain resulting from the partial
redemption in January of a real estate partnership interest.
Income Taxes
- ------------
The "Provision for income taxes" in the third quarter of 1995 totaled
$103.2 million, for an effective rate of 35.9 percent, compared with an
effective rate of 36.8 percent last year. For the first nine months of
1995, income taxes were $318.9 million for an effective tax rate of
37.3 percent, compared with an effective tax rate of 36.1 percent in 1994.
The lower year-to-date effective rate in 1994 was due primarily to
adjustments in federal income tax reserves related to prior years and to a
favorable valuation allowance adjustment for a deferred tax asset.
Required Accounting Change
- --------------------------
In March 1995, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 121, "Accounting
for the Impairment of Long-Lived Assets and for Long-Lived Assets to be
Disposed of." This standard establishes the accounting and reporting
requirements for recognizing and measuring impairment of long-lived assets
and related goodwill which either are held and used or are held for
disposal. SFAS No. 121 is effective for fiscal years beginning after
December 15, 1995, and NS plans to implement this change in the first
quarter of 1996. The impact to NS of adopting this new standard is not
currently determinable; however, it is not expected to have a material
effect on the Corporation's financial position or results of operations.
Environmental Matters
- ---------------------
NS Rail (NS' rail subsidiary) and NS Rail's wholly owned subsidiary, The
Alabama Great Southern Railroad Company ("AGS"), have complied with a
recent request from the Environmental Protection Agency ("EPA") to
provide information concerning any connection they may have had - in the
1880's - to property or the operations conducted thereon at the Bayou
Bonfouca NPL Superfund site located in Slidell, Louisiana. Since
providing such information, NS has learned informally that the EPA may
consider AGS, with several other entities believed to be solvent, a
potentially responsible party with respect to such site. Any such
designation of AGS and any associated liability will be contested; it is
not possible at this time to anticipate either (a) the amount of any
liability that may be asserted against NS or NS Rail or (b) as a
consequence, the materiality of such amount to NS' financial position,
results of operation or liquidity in a particular quarter or year.
PAGE 13
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition
and Results of Operations
FINANCIAL CONDITION AND LIQUIDITY
September 30, 1995 December 31, 1994
------------------ -----------------
(Dollars in millions)
Cash and short-term investments $287.3 $306.7
Working capital $159.4 $205.7
Current ratio 1.1 1.2
Debt to total capitalization 26.0% 26.2%
CASH FLOWS FROM OPERATING ACTIVITIES are NS' principal source of
liquidity and were sufficient to cover cash outflows for dividends, debt
repayments and capital spending (see Consolidated Statements of Cash
Flows on page 5). The increase in cash provided by operating activities,
compared with the first nine months of 1994, was primarily due to higher
income from operations and lower special charge payments.
CASH FLOWS FROM INVESTING ACTIVITIES were affected principally by
capital spending for property additions. "Investments and loans"
consists primarily of premium payments related to corporate-owned life
insurance (COLI), while "Investment sales and other transactions"
principally reflects borrowing on COLI.
CASH FLOWS FROM FINANCING ACTIVITIES primarily reflect uses of cash with
the largest amount having been spent on the stock purchase program (see
Note 4). "Proceeds from long-term borrowings" in 1995 represent amounts
received in connection with capital lease transactions entered into
during the first quarter (see Note 3), and in 1994, reflect an equipment
trust issued.
PAGE 14
PART II. OTHER INFORMATION
---------------------------
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits
Computation of Per Share Earnings
Financial Data Schedule
(b) Reports on Form 8-K
No reports on Form 8-K were filed for the three months ended
September 30, 1995.
PAGE 15
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.
NORFOLK SOUTHERN CORPORATION
-----------------------------------------
(Registrant)
Date: November 9, 1995 /s/ Dezora M. Martin
------------------- -----------------------------------------
Dezora M. Martin
Corporate Secretary (Signature)
Date: November 9, 1995 /s/ John P. Rathbone
------------------- -----------------------------------------
John P. Rathbone
Vice President and Controller
(Principal Accounting Officer) (Signature)
PAGE 16
NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES
INDEX TO EXHIBITS
-----------------
Electronic
Submission
Exhibit
Number Description Page Number
- ----------- ----------------------------------------- -----------
11 Statement re Computation of Per Share
Earnings 17-18
27 Financial Data Schedule (This exhibit is
required to be submitted electronically
pursuant to the rules and regulations of
the Securities and Exchange Commission and
shall not be deemed filed for purposes of
Section 11 of the Securities Act of 1933
or Section 18 of the Securities Exchange
Act of 1934). 19