SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended June 30, 2002 Commission File No. 0-2504
MINE SAFETY APPLIANCES COMPANY
(Exact name of registrant as specified in its charter)
Pennsylvania 25-0668780
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
121 Gamma Drive
RIDC Industrial Park
O'Hara Township
Pittsburgh, Pennsylvania 15238
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 412/967-3000
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 and (2) has been subject to such filing requirements for
the past 90 days.
Yes X No
As of July 31, 2002, there were outstanding 12,190,978 shares of common stock
without par value, not including 1,410,273 shares held by the Mine Safety
Appliances Company Stock Compensation Trust.
PART I FINANCIAL INFORMATION
MINE SAFETY APPLIANCES COMPANY
CONSOLIDATED CONDENSED BALANCE SHEET
(Thousands of dollars, except share data)
June 30 December 31
2002 2001
Unaudited
ASSETS
Current assets
Cash $ 17,430 $ 22,842
Temporary investments, at cost which approximates market 3,266 3,859
Trade receivables, less allowance for doubtful accounts
$3,305 and $2,956 66,885 50,704
Other receivables 31,793 38,325
Inventories:
Finished products 36,488 30,375
Work in process 16,054 12,099
Raw materials and supplies 39,858 35,400
--------- ---------
Total inventories 92,400 77,874
Deferred tax assets 13,978 12,944
Prepaid expenses and other current assets 12,850 10,449
--------- ---------
Total current assets 238,602 216,997
Property, plant and equipment 410,086 387,789
Accumulated depreciation (250,650) (236,128)
--------- ---------
Net property 159,436 151,661
Prepaid pension cost 101,280 92,437
Deferred tax assets 13,513 12,694
Goodwill 42,519 33,722
Other noncurrent assets 13,937 13,187
--------- ---------
TOTAL $ 569,287 $ 520,698
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Notes payable and current portion of long-term debt $ 9,230 $ 6,484
Accounts payable 35,680 24,751
Employees' compensation 14,818 14,368
Insurance 7,147 9,267
Taxes on income 3,928 4,812
Other current liabilities 30,685 22,818
--------- ---------
Total current liabilities 101,488 82,500
--------- ---------
Long-term debt 69,819 67,381
Pensions and other employee benefits 58,951 55,428
Deferred tax liabilities 60,430 56,053
Other noncurrent liabilities 5,291 5,832
Shareholders' equity
Preferred stock, 4-1/2% cumulative - authorized
100,000 shares of $50 par value; issued 71,373
shares, callable at $52.50 per share 3,569 3,569
Second cumulative preferred voting stock - authorized
1,000,000 shares of $10 par value; none issued
Common stock - authorized 60,000,000 shares of no par
value; issued 20,580,109 and 20,483,051 (outstanding
12,192,007 and 12,100,727) 27,891 25,386
Stock compensation trust - 1,410,273 and 1,415,373 shares (22,099) (22,179)
Less treasury shares, at cost:
Preferred - 50,313 and 50,313 shares (1,629) (1,629)
Common - 6,977,829 and 6,966,951 shares (132,780) (132,352)
Deferred stock compensation (1,177) (652)
Accumulated other comprehensive loss (21,723) (26,216)
Earnings retained in the business 421,256 407,577
--------- ---------
Total shareholders' equity 273,308 253,504
--------- ---------
TOTALS $ 569,287 $ 520,698
========= =========
See notes to consolidated condensed financial statements
MINE SAFETY APPLIANCES COMPANY
CONSOLIDATED CONDENSED STATEMENT OF INCOME
(Thousands of dollars, except earnings per share)
Three Months Ended Six Months Ended
June 30 June 30
Unaudited Unaudited
2002 2001 2002 2001
Net sales $ 150,719 $ 134,781 $ 284,804 $ 268,376
Other income 2,312 72 2,175 493
--------- --------- --------- ---------
153,031 134,853 286,979 268,869
--------- --------- --------- ---------
Costs and expenses
Cost of products sold 94,719 82,917 176,131 163,445
Selling, general and administrative 37,026 32,211 68,127 65,006
Depreciation and amortization 6,298 6,501 12,313 12,867
Interest 1,397 1,403 2,725 3,030
Currency exchange (gains) losses (1,075) 387 (552) 385
--------- --------- --------- ---------
138,365 123,419 258,744 244,733
--------- --------- --------- ---------
Income before income taxes 14,666 11,434 28,235 24,136
Provision for income taxes 5,182 4,460 10,767 9,315
--------- --------- --------- ---------
Net income $ 9,484 $ 6,974 $ 17,468 $ 14,821
========= ========= ========= =========
Basic earnings per common share $ 0.78 $ 0.59 $ 1.44 $ 1.25
========= ========= ========= =========
Diluted earnings per common share $ 0.77 $ 0.58 $ 1.42 $ 1.24
========= ========= ========= =========
Dividends per common share $ 0.17 $ 0.14 $ 0.31 $ 0.26
========= ========= ========= =========
See notes to consolidated condensed financial statements
MINE SAFETY APPLIANCES COMPANY
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
(Thousands of dollars)
Six Months Ended
June 30
Unaudited
2002 2001
OPERATING ACTIVITIES
Net income $ 17,468 $ 14,821
Depreciation and amortization 12,313 12,867
Pensions (7,466) (8,750)
Net gain on sale of investments and assets (32) (653)
Deferred income taxes 2,751 4,260
Changes in operating assets and liabilities (3,805) (13,612)
Other 1,096 708
--------- ---------
Cash flow from operating activities 22,325 9,641
INVESTING ACTIVITIES
Property additions (12,114) (11,448)
Property disposals 135 1,581
Acquisitions, net of cash acquired, and other investing (14,037) (7,301)
--------- ---------
Cash flow from investing activities (26,016) (17,168)
FINANCING ACTIVITIES
Changes in notes payable and short-term debt 818 3,652
Additions to long-term debt 37 6
Reductions of long-term debt (1,523) (471)
Cash dividends (3,789) (3,100)
Company stock purchases (427) (1,375)
Company stock sales 1,984 1,392
--------- ---------
Cash flow from financing activities (2,900) 104
Effect of exchange rate changes on cash 586 (1,163)
--------- ---------
Decrease in cash and cash equivalents (6,005) (8,586)
Beginning cash and cash equivalents 26,701 26,541
--------- ---------
Ending cash and cash equivalents $ 20,696 $ 17,955
========= =========
See notes to consolidated condensed financial statements
MINE SAFETY APPLIANCES COMPANY
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(1) The Management's Discussion and Analysis of Financial Condition and
Results of Operations which follows these notes contains additional
information on the results of operations and the financial position of
the company. Those comments should be read in conjunction with these
notes. The company's annual report on Form 10-K for the year ended
December 31, 2001 includes additional information about the company, its
operations, and its financial position, and should be read in
conjunction with this quarterly report on Form 10-Q.
(2) The results for the interim periods are not necessarily indicative of
the results to be expected for the full year.
(3) Certain prior year amounts have been reclassified to conform with the
current year presentation.
(4) In the opinion of management, all adjustments, consisting of only normal
recurring adjustments, necessary for a fair presentation of these
interim periods have been included.
(5) Basic earnings per share is computed on the weighted average number of
shares outstanding during the period. Diluted earnings per share
includes the effect of the weighted average stock options outstanding
during the period, using the treasury stock method. Antidilutive options
are not considered in computing diluted earnings per share.
Three Months Ended Six Months Ended
June 30 June 30
2002 2001 2002 2001
( In thousands) ( In thousands)
Net income $ 9,484 $ 6,974 $ 17,468 $ 14,821
Preferred stock dividends declared 12 12 24 24
------------ ------------ ------------ ------------
Income available to common shareholders 9,472 6,962 17,444 14,797
------------ ------------ ------------ ------------
Basic shares outstanding 12,174 11,841 12,142 11,838
Stock options 157 165 150 128
------------ ------------ ------------ ------------
Diluted shares outstanding 12,331 12,006 12,292 11,966
------------ ------------ ------------ ------------
Antidilutive stock options 10 8 10 8
------------ ------------ ------------ ------------
(6) Comprehensive income was $15,001,000 and $21,961,000 for the three and
six months ended June 30, 2002, respectively, and $5,811,000 and
$11,792,000 for the three and six months ended June 30, 2001,
respectively. Comprehensive income includes net income and changes in
accumulated other comprehensive income, primarily cumulative translation
adjustments, for the period.
(7) The company is organized into three geographic operating segments (North
America, Europe and Other International), each of which includes a
number of operating companies.
Reportable segment information is presented in the following table:
North Other Consolidated
(In Thousands) America Europe International Reconciling totals
Three Months Ended June 30, 2002
Sales to external customers $102,759 $29,206 $18,729 $ 25 $150,719
Intercompany sales 4,966 8,695 587 (14,248)
Net income 7,516 982 710 276 9,484
Six Months Ended June 30, 2002
Sales to external customers 198,266 51,777 34,724 37 284,804
Intercompany sales 10,092 15,949 1,090 (27,131)
Net income 15,102 969 1,214 183 17,468
Three Months Ended June 30, 2001
Sales to external customers 93,604 22,351 18,794 32 134,781
Intercompany sales 4,587 5,447 630 (10,664)
Net income (loss) 5,939 (45) 1,024 56 6,974
Six Months Ended June 30, 2001
Sales to external customers 184,301 47,417 36,602 56 268,376
Intercompany sales 9,325 10,533 961 (20,819)
Net income 12,488 519 1,767 47 14,821
Reconciling items consist primarily of intercompany eliminations and
items reported at the corporate level.
(8) At June 30, 2002, accounts receivable of $63.9 million were owned by
Mine Safety Funding Corporation, an unconsolidated wholly-owned
bankruptcy-remote subsidiary of the company. The company held a
subordinated interest in these receivables of $32.8 million, of which
$31.8 million is classified as other receivables. Net proceeds to the
company from the securitization arrangement were $30.0 million at June
30, 2002.
At December 31, 2001, accounts receivable of $65.0 million were owned by
Mine Safety Funding Corporation. The company held a subordinated
interest in these receivables of $39.3 million, of which $38.3 million
is classified as other receivables. Net proceeds to the company from the
securitization arrangement were $25.0 million at December 31, 2001.
The key economic assumptions used to measure the retained interest at
June 30, 2002 were a discount rate of 4% and an estimated life of 2.4
months. At June 30, 2002, an adverse change in the discount rate or
estimated life of 10% and 20% would reduce the fair value of the
retained interest by $53,000 and $106,000, respectively. The effect of
hypothetical changes in fair value based on variations in assumptions
should be used with caution and generally cannot be extrapolated.
Additionally, the effect on the fair value of the retained interest of
changing a particular assumption has been calculated without changing
other assumptions. In reality, a change in one factor may result in
changes in others.
(9) During the second quarter, the company acquired CGF Gallet based in
Lyon, France for $15.0 million. The acquisition has been recorded in
accordance with FAS 141, Business Combinations, which requires the
purchase method of accounting and establishes specific criteria for
recognition of intangible assets other than goodwill. Preliminary
estimates indicate goodwill associated with the acquisition will be
approximately $8.5 million. The final allocation of the purchase price
is expected to be completed by December 31, 2002. Gallet is the leading
European manufacturer of protective helmets for the fire service, as
well as head protection for the police and military. This acquisition
complements MSA's strong existing line of fire service products and
provides the opportunity to capitalize on opportunities where Gallet is
strong - such as in the law enforcement, military and aviation markets.
Gallet is being integrated into the company's operations and its
products will be marketed under the MSA Gallet name. Gallet's results of
operations for May and June 2002 are included in the consolidated
financial statements.
The following unaudited pro forma summary presents information as if
Gallet had been acquired January 1, 2001:
Three Months Ended Six Months Ended
June 30 June 30
------------------------------ ----------------------------
(In thousands, except EPS) 2002 2001 2002 2001
---- ---- ---- ----
Net sales $154,198 $140,468 $298,630 $279,751
Net income 9,637 7,134 18,444 15,140
Basic earnings per share 0.79 0.60 1.52 1.28
(10) Effective January 1, 2002, the company adopted the non-amortization
provisions of FAS No. 142, Goodwill and Other Intangible Assets. Under
this standard, goodwill and intangible assets with indefinite lives are
not amortized, but are subject to impairment tests that must be
performed at least annually. If goodwill amortization had been
discontinued January 1, 2001, net income for the year ended December 31,
2001, would have increased by $1.4 million, or eleven cents per share.
The transitional impairment tests on goodwill as of January 1, 2002 have
been completed and did not indicate that an impairment write-down should
be recorded.
The effects of adopting the non-amortization provisions on net income
and basic earnings per share for the three and six months ended June 30,
2002 and 2001 were as follows:
In thousands Three Months Ended June 30 Six Months Ended June 30
-------------------------- ------------------------
Net Income Basic EPS Net Income Basic EPS
---------- --------- ---------- ---------
2002 2001 2002 2001 2002 2001 2002 2001
---- ---- ---- ---- ---- ---- ---- ----
Reported net income $ 9,484 $ 6,974 $ 0.78 $ 0.59 $ 17,468 $ 14,821 $ 1.44 $ 1.25
Goodwill amortization 344 0.03 681 0.06
------------------ ---------------- -------------------- ------------------
Adjusted net income $ 9,484 $ 7,318 $ 0.78 $ 0.62 $ 17,468 $ 15,502 $ 1.44 $ 1.31
================== ================ ==================== ==================
Intangible assets include non-compete agreements that will be fully
amortized in 2003 and patents that will be fully amortized in 2005.
These items are included in other noncurrent assets. At June 30, 2002,
intangible assets totaled $304,000, net of accumulated amortization of
$2.7 million. Intangible asset amortization expense is expected to be
approximately $355,000 in 2002, $115,000 in 2003, and $55,000 in 2004.
Changes in goodwill and intangible assets, net of accumulated
amortization, during the six months ended June 30, 2002 were as follows:
(In thousands) Goodwill Intangibles
-------- -----------
Net balances at December 31, 2001 $ 33,722 $ 526
Additions to goodwill 8,782
Amortization expense (222)
Translation 15
-------- -----------
Net balances at June 30, 2002 $ 42,519 $ 304
======== ===========
Gallet intangible assets other than goodwill, if any, will be identified
by December 31,2002 and reported separately.
(11) FAS No. 143, Accounting for Asset Retirement Obligations, addresses
accounting for obligations associated with the retirement of tangible
long-lived assets. The company will adopt FAS No. 143 effective January
1, 2003 and does not expect that the adoption of this statement will
have a significant effect on its results of operations or financial
position.
FAS 146, Accounting for Costs Associated with Exit or Disposal
Activities, requires that costs associated with exit or
disposal activities be recognized when the liability is incurred rather
than at the date of commitment to an exit or disposal plan. The
provisions of FAS 146 are effective for exit or disposal activities that
are initiated after December 31, 2002. Early adoption is encouraged. The
company does not expect that the adoption of this statement will have a
significant effect on its results of operations or financial position
MANAGEMENT'S DISCUSSION AND ANALYSIS
Forward-looking statements
Certain statements contained in this report may constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements involve a number of risks, uncertainties
and other factors that could cause actual results to differ materially from
expectations contained in such statements.
Factors that may materially affect financial condition and future results
include: global economic conditions; the threat of terrorism and its potential
consequences; the timely and successful introduction of new products; timely and
successful integration of acquisitions; the availability of funding in the fire
service and homeland security markets; the ability of third party suppliers to
provide key materials and components; market conditions affecting specialty
chemical customers; liquidity; and interest and currency exchange rates.
Corporate Initiatives
During the second quarter of 2002, MSA acquired CGF Gallet, the leading European
manufacturer of protective helmets for the fire service, as well as head
protection for the police and military. This acquisition complements MSA's
strong existing line of fire service products, and provides the opportunity to
capitalize on emerging opportunities where Gallet is strong - such as in the law
enforcement, military, and aviation markets. Gallet is being integrated into the
company's operations and its products are being marketed under the MSA Gallet
name.
Results of operations
Three months ended June 30, 2002 and 2001
Sales for the second quarter of 2002 were $150.7 million, an increase of $15.9
million, or 12%, from $134.8 million in the second quarter of 2001.
Second quarter 2002 sales for North American operations of $102.8 million were
$9.2 million, or 10%, higher than in the second quarter of last year. Shipments
of respiratory protection products, including gas masks, respirators, and
self-contained breathing apparatus, were significantly higher in 2002,
reflecting continued strong product interest and demand in the homeland security
and fire service markets. These sales gains were partially offset by somewhat
lower sales of both portable and permanent instruments, primarily due to
continuing sluggishness in industrial markets and capital spending. U.S.
exports of safety products were disappointing, affected by economic disturbances
in key export country markets and, until recently, the strong U.S. dollar.
Specialty chemical sales improved during the current quarter.
In Europe, second quarter 2002 sales of $29.2 million were $6.9 million, or 31%
higher than in second quarter 2001. The increase reflects higher local currency
sales in continuing operations and the addition of Gallet following its
acquisition. When stated in U.S. dollars, European sales were also favorably
affected by currency exchange rate movements.
Second quarter 2002 local currency sales for Other International operations were
approximately 6% higher than in second quarter 2001 on strong shipments in South
Africa. When stated in U.S. dollars, however, sales of Other International
operations were flat, reflecting the strengthening of the U.S. dollar against
African and South American currencies.
Gross profit for the second quarter of 2002 was $56.0 million, an increase of
$4.1 million, or 8%, from $51.9 million in second quarter 2001. The ratio of
gross profit to sales was 37.2% in the second quarter of 2002 compared to 38.5%
in the corresponding quarter last year. The lower gross profit percentage is
primarily due to product mix changes.
Selling, general and administration costs in the second quarter of 2002 were
$37.0 million, an increase of $4.8 million, or 15%, compared to $32.2 million in
second quarter 2001. The increase includes higher expenses in the U.S.,
post-acquisition expenses of Gallet, and the currency translation effects of the
stronger Euro.
Depreciation and amortization expense in second quarter 2002 was $6.3 million, a
decrease of $200,000, or 3%, from $6.5 million in the corresponding quarter last
year. The decrease includes the effect of discontinuing goodwill amortization in
2002 as prescribed by FAS No. 142. Goodwill amortization expense was $564,000 in
the second quarter of 2001. The decrease in goodwill amortization expense was
partially offset by the additional depreciation for Gallet assets, the
translation effect of the stronger Euro, and regular asset acquisitions.
Interest expense was $1.4 million in second quarters of both 2002 and 2001.
Currency exchange gains were $1.1 million in second quarter 2002 compared to
losses of $387,000 in the second quarter of last year. The current quarter gain
relates primarily to the strengthening of Euro and Canadian dollar-denominated
assets, partially offset by continued devaluation of the Argentine Peso.
Other income was $2.3 million in the second quarter of 2002 compared to $72,000
for second quarter 2001. Other income in second quarter 2002 included a gain of
$2.1 million on the sale of real estate development property in Pittsburgh.
Income before income taxes was $14.7 million for second quarter 2002 compared to
$11.4 million in second quarter 2001, an increase of $3.2 million, or 28%.
The effective income tax rate for the second quarter of 2002 was 35.3% compared
to 39.0% in second quarter 2001. The lower rate in 2002 relates to
proportionately higher income in lower tax rate countries and permanent
differences.
Net income in the second quarter of 2002 was $9.5 million, or 78 cents per basic
share, compared to $7.0 million, or 59 cents per basic share, in the second
quarter last year.
Six months ended June 30, 2002 and 2001
Sales for the six months ended June 30, 2002 were $284.8 million, an increase of
$16.4 million, or 6%, from $268.4 million last year.
North American sales for the six months ended June 30, 2002 of $198.3 million
were $14.0 million, or 8% higher than the same period last year. Higher
shipments of gas masks and respirators to military and homeland security markets
accounted for a significant portion of the improvement. Portable and permanent
instrument sales were lower than in the same period last year, reflecting
sluggishness in industrial markets. Sales of specialty chemicals were lower than
in the first six months of 2001, primarily due to unusually strong shipments to
pharmaceutical customers early in 2001.
Sales in Europe for the six months ended June 30, 2002 of $51.8 million were
$4.4 million, or 9% , higher than the same period in 2001. The increase reflects
local currency sales growth and the addition of Gallet sales, following its
acquisition during the second quarter.
Local currency sales of Other International operations for the first six months
of 2002 were approximately 5% higher than in the same period last year, with
improvement primarily in South Africa and Brazil. When stated in U.S. dollars,
however, Other International sales for the six months ended June 30, 2002 of
$34.7 million were $1.9 million, or 5%, lower than last year due to currency
exchange rate movements.
Gross profit for the six months ended June 30, 2002 was $108.7 million, an
increase of $3.8 million, or 4%, from $104.9 million in the first six months of
2001. The ratio of gross profit to sales was 38.2% in the six months ended June
30, 2002 compared to 39.1% in the corresponding period last year. The lower
gross profit percentage is primarily due to sales mix changes.
Selling, general and administration costs in the six months ended June 30, 2002
were $68.1 million, an increase of $3.1 million, or 5%, from $65.0 million in
the same period
last year. The increase includes higher expenses in the U.S., the
post-acquisition expenses of Gallet, and the currency translation effects of the
stronger Euro.
Depreciation and amortization expense was $12.3 million in the six months ended
June 30, 2002, a decrease of $554,000, or 4%, from $12.9 million in the same
period last year. The decrease is primarily due to the effect of discontinuing
goodwill amortization in 2002 as prescribed by FAS No. 142. Goodwill
amortization expense was $1.1 million for the six months ended June 30, 2001.
The decrease in goodwill amortization expense was partially offset by the
additional depreciation for Gallet assets, the translation effect of the
stronger Euro, and regular asset acquisitions.
Interest expense for the six months ended June 30, 2002 was $2.7 million, a
decrease of $305,000, or 10%, from $3.0 million in the same period last year.
Lower interest expense in 2002 reflects a $5 million reduction in notes payable
during December 2001 and lower average short-term borrowings.
Currency exchange gains were $552,000 in the six months ended June 30, 2002
compared to losses of $385,000 in the same period last year. The current year
gain relates primarily to the strengthening of Euro and Canadian
dollar-denominated assets, partially offset by continued devaluation of the
Argentine Peso.
Other income was $2.2 million for the six months ended June 30, 2002 compared to
$493,000 in the first half of 2001. Other income in the first half of 2002
included a gain of $2.1 million on the sale of real estate development property
in Pittsburgh.
Income before income taxes was $28.2 million for the six months ended June 30,
2002 compared to $24.1 million in the first six months of 2001, an increase of
$4.1 million, or 17%.
The effective income tax rate for the six months ended June 30, 2002 was 38.1%
compared to 38.6% in the same period last year. The lower effective rate in 2002
relates to proportionately higher income in lower tax rate countries and
differences in permanent items.
Net income in the six months ended June 30, 2002 was $17.5 million, or $1.44 per
basic share, compared to $14.8 million, or $1.25 per basic share, in the first
six months of 2001.
Liquidity and Financial Condition
Cash and cash equivalents decreased $6.0 million during the six months ended
June 30, 2002 compared with a decrease of $8.6 million in the same period of
2001.
Operating activities provided $22.3 million of cash in the six months ended June
30, 2002 compared to providing $9.6 million in the first half of last year. The
improvement
reflects higher operating income and more favorable adjustments for non-cash
income and expenses. Cash used for increases in net operating assets was also
lower during the current year.
Cash of $26.0 million was used for investing activities in the first half of
2002 compared with the use of $17.2 million in the same period last year. The
increased use of cash for investing activities in 2002 was primarily related to
the Gallet acquisition. The 2001 amounts include cash used for the acquisition
of Surety Manufacturing and Testing, Ltd. and the cash proceeds from the sale of
a safety products distribution business in Sweden.
Financing activities used $2.9 million in the first half of 2002 and provided
$104,000 in the same period last year. Higher cash provided by financing
activities in 2001 related primarily to short term borrowings.
Available credit facilities and internal cash resources are considered adequate
to provide for future operations, capital requirements, and dividends to
shareholders.
Financial Instrument Market Risk
There have been no material changes in the company's financial instrument market
risk during the first six months of 2002. For additional information, refer to
page 19 of the company's Annual Report to Shareholders for the year ended
December 31, 2001.
Recently Issued Accounting Standards
FAS 143, Accounting for Asset Retirement Obligations, effective January 1, 2003,
addresses accounting and reporting for legal obligations associated with the
retirement of tangible long-lived assets. The company does not expect that the
adoption of this statement will have a significant effect on its results or
financial position.
FAS 146, Accounting for Costs Associated with Exit or Disposal Activities,
requires that costs associated with exit or disposal activities be recognized
when the liability is incurred rather than at the date of commitment to an exit
or disposal plan. The provisions of FAS 146 are effective for exit or disposal
activities that are initiated after December 31, 2002. Early adoption is
encouraged. The company does not expect that the adoption of this statement will
have a significant effect on its results of operations or financial position.
PART II OTHER INFORMATION
MINE SAFETY APPLIANCES COMPANY
Item 1. Legal Proceedings
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
(a) May 7, 2002 - Annual Meeting
(b) Directors elected at Annual Meeting:
Joseph L. Calihan
L. Edward Shaw, Jr.
Thomas H. Witmer
Directors whose term of office continued after the meeting:
Calvin A. Campbell, Jr.
Thomas B. Hotopp
James A. Cederna
John T. Ryan III
John C. Unkovic
(c) Election of three Directors for a term of three years:
Joseph L. Calihan For 11,769,507
Withhold 10,523
Abstentions/ 0
Broker Nonvotes
L. Edward Shaw, Jr. For 11,769,687
Withhold 10,343
Abstentions/ 0
Broker Nonvotes
Thomas H. Witmer For 11,764,495
Withhold 15,535
Abstentions/ 0
Broker Nonvotes
Selection of PricewaterhouseCoopers LLP as independent
accountants for the year ending December 31, 2002.
For 11,755,484
Against 24,521
Abstentions/ 25
Broker Nonvotes
(d) Not Applicable
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits - None
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter ended June 30, 2002.
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.
MINE SAFETY APPLIANCES COMPANY
Date: August 13, 2002 By /S/ Dennis L. Zeitler
Dennis L. Zeitler
Chief Financial Officer