SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Fiscal Year Ended December 31, 1998
Commission file number: 0-16960
----------------
THE GENLYTE GROUP INCORPORATED
4360 Brownsboro Road
Louisville, Kentucky 40207
(502) 893-4600
INCORPORATED IN DELAWARE I.R.S. EMPLOYER
IDENTIFICATION NO. 22-2584333
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: NONE
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
- --------------------------------------------------------------------------------
Common Stock, par value NASDAQ National Market System
$.0l per share
Number of shares of Common Stock (par value $.0l per share) outstanding as of
March 1, 1999: 13,561,298.
Aggregate market value of Common Stock (par value $.01 per share) held by
non-affiliates on March 1, 1999: $250,036,432.
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. [ ]
Documents Incorporated by Reference:
Document Part of Form 10-K
Annual report to stockholders for the
fiscal year ended December 31, 1998 Parts I, II, and IV
Proxy Statement for the Annual Meeting
of Stockholders to be held April 21, 1999 Part III
PART I
ITEM 1. BUSINESS
On August 30, 1998, The Genlyte Group Incorporated ("Genlyte") and Thomas
Industries Inc. ("Thomas") completed the combination of the business of Genlyte
with the lighting business of Thomas ("Thomas Lighting"), in the form of a
limited liability company named Genlyte Thomas Group LLC ("Genlyte Thomas").
Genlyte contributed substantially all of its assets and liabilities to Genlyte
Thomas and received a 68% interest in Genlyte Thomas. Thomas contributed
substantially all of its assets and certain related liabilities comprising
Thomas Lighting and received a 32% interest in Genlyte Thomas. Throughout this
Form 10-K, the term "Company" as used herein refers to The Genlyte Group
Incorporated, including the consolidation of The Genlyte Group Incorporated and
Genlyte Thomas Group LLC.
The Company designs, manufactures, markets, and sells lighting fixtures for a
wide variety of applications in the commercial, industrial, and residential
markets. The Company operates in these three industry segments through the
following divisions: Lightolier, Controls, Wide-Lite, Hadco, Diamond F, Supply
(Crescent, ExceLine, and Stonco product lines), Consumer, Indoor, Accent, and
Outdoor in the United States and Mexico, and Canlyte, Thomas Lighting Canada,
Lumec, and ZED in Canada. The Company markets its products under the following
brand names:
In the U.S. -- Bronzelite, Capri, Crescent, Day-Brite, Diamond F,
Electro/Connect, Emco, ExceLine, Forecast, Gardco,
Hadco, Lightolier, Lightolier Controls, Lumec,
Lumec-Schreder, Matrix, McPhilben, Omega, Starlight,
Stonco, Thomas, Wide-Lite, and ZED.
In Canada -- C&M, CFI (Canadian Fluorescent Industries), Capri,
Day-Brite, Hadco, Horizon, Lite-Energy,
Keene-Widelite, Lightolier, Lumec, Prodel, Stonco,
Uniglo, and ZED.
In Mexico -- Bronzelite, Capri, Day-Brite, Emco, Forecast, Gardco,
Hadco, Lightolier, Lumec, Thomas, and Wide-Lite.
The Company's products primarily utilize incandescent, fluorescent, and
high-intensity discharge (HID) light sources and are marketed primarily to
distributors who resell the products for use in new residential, commercial, and
industrial construction as well as in remodeling existing structures. Because
the Company does not principally sell directly to the end-user of its products,
the Company
2
cannot determine precisely the percentage of its revenues derived from the sale
of products installed in each type of building or the percentage of its products
sold for new construction versus remodeling. The Company's sales, like those of
the lighting fixture industry in general, are partly dependent on the level of
activity in new construction and remodeling.
PRODUCTS AND DISTRIBUTION
The Company designs, manufactures, markets, and sells the following types of
products:
Indoor Fixtures -- Incandescent, fluorescent, and HID lighting fixtures
and lighting controls for commercial, industrial,
institutional, medical, sports, and residential
markets, and task lighting for all markets.
Outdoor Fixtures -- HID and incandescent lighting fixtures and
accessories for commercial, industrial,
institutional, sports, and residential markets.
The Company's products are marketed by independent sales representatives and
Company direct sales personnel who sell to distributors, electrical wholesalers,
mass merchandisers, and national accounts. In addition, the Company's products
are promoted through architects, engineers, contractors, and building owners.
The fixtures are principally sold throughout the United States, Canada, and
Mexico.
RAW MATERIALS SOURCES & AVAILABILITY
The Company purchases large quantities of raw materials and components -- mainly
steel, aluminum, ballasts, sockets, wire, plastic, lenses, and glass -- from
multiple sources. No significant supply problems have been encountered in recent
years. Relationships with vendors have been satisfactory.
SEASONAL EFFECT ON BUSINESS
There are no predictable significant seasonal effects on the Company's results
of operations.
PATENTS AND TRADEMARKS
The Company has a number of United States and foreign mechanical patents, design
patents, and registered trademarks. The Company maintains such protections by
periodic renewal of trademarks and payments of maintenance fees for issued
patents. The Company vigorously enforces its intellectual property rights. The
Company does not believe that a loss of any presently held patent or trademark
is likely to have a material adverse impact on its business.
3
WORKING CAPITAL
There are no unusual significant business practices at the Company that affect
working capital. The Company's terms of sale vary by division but are generally
consistent with general practices within the lighting industry. The Company
attempts to keep inventory levels at the minimum required to satisfy customer
requirements.
BACKLOG
Backlog was $115,520,000 as of December 31, 1998; $54,206,000 as of December 31,
1997, and $42,247,000 as of December 31, 1996. The $61,314,000 increase from
December 31, 1997 to December 31, 1998 was primarily because of the formation of
Genlyte Thomas; the backlog associated with the former Thomas Lighting business
was $47,701,000 at December 31, 1998. Substantially all the backlog at December
31, 1998 is expected to be shipped in 1999.
COMPETITION
The Company's products are sold in competitive markets in which are numerous
producers of each type of fixture. The principal measures of competition in
indoor and outdoor fixtures for the commercial, residential, and industrial
markets are price, service, design, and product performance.
RESEARCH AND DEVELOPMENT
The Company is constantly monitoring new light sources for incorporation into
new product development. Costs incurred for research and development activities,
as determined in accordance with generally accepted accounting principles, were
$7,237,000; $5,195,000, and $4,475,000 during 1998, 1997, and 1996,
respectively.
EMPLOYEES
At December 31, 1998, the Company employed approximately 3,490 union and
nonunion production workers and approximately 1,800 engineering, administrative,
and sales personnel. Approximately 9% of the production workers are covered by
collective bargaining agreements that expire in 1999. Relationships with unions
have been satisfactory. Negotiation of collective bargaining agreements is not
expected to have a significant impact on 1999 production.
4
INTERNATIONAL OPERATIONS
The Company has international operations in Canada and Mexico. Information on
the Company's operations by geographical area for the last three fiscal years is
set forth in the "Notes to Consolidated Financial Statements" section of
Genlyte's 1998 Annual Report to Stockholders (Exhibit 13 hereto), which is
incorporated herein by reference.
ITEM 2. PROPERTIES
The leased Corporate offices of the Company are located in Louisville, Kentucky.
Because of the large number of individual locations and the diverse nature of
the operating facilities, specific description of each property owned and leased
by the Company is not necessary to an understanding of the Company's business.
All of the buildings are of steel, masonry, or concrete construction, are
generally in good condition, provide adequate and suitable space for the
operations of each location, and provide sufficient capacity for present and
foreseeable future needs. A summary of the Company's property follows:
26 Owned Facilities 31 Leased Facilities Combined Facilities
Nature of Facilities Total Square Feet Total Square Feet Total Square Feet
- -------------------- ----------------- ----------------- -----------------
Manufacturing Plants 2,191,000 473,000 2,664,000
Distribution Centers 1,194,000 334,000 1,528,000
Administrative Offices 329,000 104,000 433,000
Sales Offices -- 29,000 29,000
Other 87,000 1,000 88,000
--------- ------- ---------
Total 3,801,000 941,000 4,742,000
========= ======= =========
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ITEM 3. LEGAL PROCEEDINGS
Genlyte has been named as one of a number of corporate and individual defendants
in an adversary proceeding filed on June 8, 1995, arising out of the Chapter 11
bankruptcy filing of Keene Corporation ("Keene"). Except for the last count, as
discussed below, the claims and causes of action set forth in the June 8, 1995
complaint (the "complaint") are substantially the same as were brought against
Genlyte in the U.S. District Court in New York in August 1993, (which original
proceeding was permanently enjoined as a result of Keene's reorganization plan).
The complaint is being prosecuted by the Creditors Trust created for the benefit
of Keene's creditors (the "Trust"), seeking from the defendants, collectively,
damages in excess of $700 million, rescission of certain asset sale and stock
transactions, and other relief. With respect to Genlyte, the complaint
principally maintains that certain lighting assets of Keene were sold to a
predecessor of Genlyte in 1984 at less than fair value, while both Keene and
Genlyte were wholly-owned subsidiaries of Bairnco Corporation ("Bairnco"). The
complaint also challenges Bairnco's spin-off of Genlyte in August 1988. Other
allegations are that Genlyte, as well as other corporate defendants, are liable
as corporate successors to Keene. The complaint fails to specify the amount of
damages sought against Genlyte. The complaint also alleges a violation of the
Racketeer Influenced and Corrupt Organizations Act ("RICO").
Following confirmation of the Keene reorganization plan, the parties moved to
withdraw the case from bankruptcy court to the Southern District of New York
Federal District Court. The case is now pending before the Federal District
Court. On October 13, 1998, the Court issued an opinion dismissing certain
counts as to Genlyte and certain other corporate defendants. In particular, the
Court dismissed the count of the complaint against Genlyte that alleged that the
1988 spin-off was a fraudulent transaction, and the count alleging a violation
of RICO. The Court also denied a motion to dismiss the challenge to the 1984
transaction on statute of limitations grounds and ruled that the complaint
should not be dismissed for failure to specifically plead fraud.
On January 5 and 6, 1999, the Court rendered additional rulings further
restricting the claims by the Trust against Genlyte and other corporate
defendants, and dismissing the claims against all remaining individual
defendants except one. The primary effect of the rulings with respect to claims
against Genlyte was to require the Trust to prove that the 1984 sale of certain
lighting assets of Keene was made with actual intent to defraud present and
future creditors of Genlyte's predecessor.
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Discovery, which was stayed since commencement of the action, has now been
authorized by the Court to begin. Genlyte has filed its answer to the complaint
and is in the process of responding to and requesting discovery.
Genlyte believes that it has meritorious defenses to the adversary proceeding
and will defend said action vigorously.
Additionally, the Company is a defendant and/or potentially responsible party,
with other companies, in actions and proceedings under state and Federal
environmental laws including the Federal Comprehensive Environmental Response
Compensation and Liability Act, as amended. Management does not believe that the
disposition of the lawsuits and/or proceedings will have a material effect on
the Company's financial condition, results of operations, or liquidity.
In the normal course of business, the Company is a party to legal proceedings
and claims. When costs can be reasonably estimated, appropriate liabilities for
such matters are recorded. While management currently believes the amount of
ultimate liability, if any, with respect to these actions will not materially
affect the financial position, results of operations, or liquidity of the
Company, the ultimate outcome of any litigation is uncertain. Were an
unfavorable outcome to occur, the impact could be material to the Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
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PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY & RELATED STOCKHOLDER MATTERS
a. and c. Data regarding market price of Genlyte's common stock
is included in the "Notes to Consolidated Financial
Statements" section of Genlyte's 1998 Annual Report to
Stockholders (Exhibit 13 hereto), which is incorporated
herein by reference. Genlyte's common stock is traded
on the NASDAQ National Market System under the symbol
"GLYT". Information concerning dividends and
restrictions thereon and Preferred Stock Purchase
Rights are included in the "Notes to Consolidated
Financial Statements" section of Genlyte's 1998 Annual
Report to Stockholders, which is incorporated herein by
reference.
b. The approximate number of common equity security
holders is as follows:
Approximate Number of
Holders of Record as of
Title of Class Year-end 1998
-----------------------------------------------------------------------
Common Stock,
par value $.0l per share 1,459
ITEM 6. SELECTED FINANCIAL DATA
The information required for this item is included in Genlyte's 1998
Annual Report to Stockholders (Exhibit 13 hereto), which is
incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Reference is made to the "Management's Discussion and Analysis" section
of Genlyte's 1998 Annual Report to Stockholders (Exhibit 13 hereto),
which is incorporated herein by reference.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
At December 31, 1998, a hypothetical 1% increase in interest rates
would result in a reduction of approximately $630,000 in pre-tax
income. The estimated reduction is based upon no change in the volume
or composition of debt at December 31, 1998.
8
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Reference is made to the "Consolidated Financial Statements" and "Notes
to Consolidated Financial Statements" sections of Genlyte's 1998 Annual
Report to Stockholders (Exhibit 13 hereto), which is incorporated
herein by reference. Financial statement schedules are included in Part
IV of this filing.
ITEM 9. CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
9
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information required with respect to the Directors of Genlyte is
included in the "Election of Director" section of the Proxy Statement
for the 1999 Annual Meeting of the Stockholders of Genlyte, which has
been filed with the Securities and Exchange Commission and is
incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION
The information with respect to executive compensation is included in
the "Compensation of Directors" and "Compensation Committee Report on
Executive Compensation" sections of the Proxy Statement for the 1999
Annual Meeting of Stockholders of Genlyte, which has been filed with
the Securities and Exchange Commission and is incorporated herein by
reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information required with respect to security ownership is included
in the "Voting Securities and Principal Holders Thereof" section of the
Proxy Statement for the 1999 Annual Meeting of Stockholders of Genlyte,
which has been filed with the Securities and Exchange Commission and is
incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required with respect to relationships is included in
the "Compensation Committee Interlocks and Insider Participation" and
"Voting Securities and Principal Holders Thereof" sections of the Proxy
Statement for the 1999 Annual Meeting of Stockholders of Genlyte, which
has been filed with the Securities and Exchange Commission and is
incorporated herein by reference.
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PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
a) 1) FINANCIAL STATEMENTS
The following information is incorporated herein by reference to
Genlyte's 1998 Annual Report to Stockholders (Exhibit 13 hereto):
Report of Independent Public Accountants
Consolidated Statements of Income for the years ended December
31, 1998, 1997, and 1996
Consolidated Balance Sheets as of December 31, 1998 and 1997
Consolidated Statements of Cash Flows for the years ended
December 31, 1998, 1997, and 1996
Consolidated Statements of Stockholders' Investment for the years
ended December 31, 1998, 1997, and 1996
Notes to Consolidated Financial Statements
2) FINANCIAL STATEMENT SCHEDULE
Report of Independent Public Accountants on Financial Statement
Schedule
Schedule II -- Valuation and Qualifying Accounts
Other schedules are omitted because of the absence of conditions
under which they are required or because the required information
is included in the consolidated financial statements or notes
thereto.
b) A Form 8-K/A was filed on November 5, 1998, to amend the Form 8-K
filed on September 11, 1998 announcing that Genlyte and Thomas
completed the transaction that created Genlyte Thomas Group LLC.
The amendment provided the required financial statements in
accordance with the form.
11
c) Exhibits
INCORPORATED BY
DESCRIPTION REFERENCE TO
- - Amended and Restated Exhibit 3(b) to Genlyte's Registration
Certificate of Incorporation of Statement on Form 8 as filed with the
the Registrant, dated August 2, Securities and Exchange Commission on
1988 August 3, 1988
- - Amended and Restated Exhibit 3(a) to Genlyte's Form 10-K
Certificate of Incorporation of filed with the Securities and Exchange
the Registrant, dated May 9, Commission in March 1993
1990
- - Amended and Restated By-laws of Exhibit 3(c) to Genlyte's Registration
the Registrant, as adopted on Statement on Form 8 as filed with the
May 16, 1988 Securities and Exchange Commission on
August 3, 1988
- - Form of Stock Certificate for Exhibit 4(a) to Genlyte's Registration
Genlyte Common Stock Statement on Form 8 as filed with the
Securities and Exchange Commission on
August 3, 1988
- - Stock Purchase Agreement Exhibit 10(a) to Genlyte's Registration
between the Registrant and Statement on Form 8 as filed with the
purchasers of Class B Stock of Securities and Exchange Commission on
the Registrant, dated as of August 3, 1988
June 17, 1988
- - Loan Agreement between The Exhibit 10(b) to Genlyte's Form 10-K
Genlyte Group Incorporated and filed with the Securities and Exchange
the New Jersey Economic Commission in March 1991
Development Authority dated
April 1, 1990, replacing the
First Mortgage and Security
Agreement between the New
Jersey Economic Development
Authority and KCS Lighting,
Inc., dated December 20, 1984
(assigned to and assumed by the
Registrant effective December
31, 1986)
12
INCORPORATED BY
DESCRIPTION REFERENCE TO
- - Loan Agreement between The Exhibit 10(c) to Genlyte's Form 10-K
Genlyte Group Incorporated and filed with the Securities and Exchange
the New Jersey Economic Commission in March 1991
Development Authority dated
June 1, 1990, replacing the
Loan Agreement between KCS
Lighting, Inc. and the New
Jersey Economic Development
Authority, dated December 20,
1984 (assigned to and assumed
by the Registrant effective
December 31, 1986)
- - ManagementIncentive Exhibit 10(i) to Genlyte's Registration
Compensation Plan Statement on Form 8 as filed with the
Securities and Exchange Commission on
August 3, 1988
- - Genlyte 1988 Stock Option Plan Exhibit 10(j) to Genlyte's Registration
Statement on Form 8 as filed with the
Securities and Exchange Commission on
August 3, 1988
- - Genlyte 1998 Stock Option Plan Annex A to Genlyte's Proxy Statement
(Form DEF 14A) for the 1998 Annual
Meeting of Stockholders of Genlyte as
filed with the Securities and Exchange
Commission on March 23, 1998
- - Tax Sharing Agreement between Exhibit 10(k) to Genlyte's Registration
Genlyte and Bairnco Statement on Form 8 as filed with the
Corporation, dated July 15, Securities and Exchange Commission on
1988 August 3, 1988
- - Merger and Assumption Exhibit 10(d) to Genlyte's Form 10-K
Agreement, dated as of December filed with the Securities and Exchange
28, 1990, by and between Commission in March 1991
Genlyte and Lightolier
- - Loan Agreement between The Exhibit 4(c) to Genlyte's Form 10-K
Genlyte Group Incorporated and filed with the Securities and Exchange
Jobs for Fall River, Inc., Commission in March 1995
dated as of July 13, 1994
13
INCORPORATED BY
DESCRIPTION REFERENCE TO
- - Master Transaction Agreement Exhibit 2.1 to Genlyte's Form 8-K filed
dated April 28, 1998 by and with the Securities and Exchange
between Thomas and Genlyte Commission on July 24, 1998
- - Limited Liability Company Exhibit 2.2 to Genlyte's Form 8-K filed
Agreement of GT Lighting, LLC with the Securities and Exchange
(now named Genlyte Thomas) Commission on July 24, 1998
dated April 28, 1998 by and
among Thomas, Genlyte and
Genlyte Thomas
- - Capitalization Agreement dated Exhibit 2.3 to Genlyte's Form 8-K filed
April 28, 1998 by and among with the Securities and Exchange
Genlyte Thomas and Thomas and Commission on July 24, 1998
certain of its affiliates
- - Capitalization Agreement dated Exhibit 2.4 to Genlyte's Form 8-K filed
April 28, 1998 by and between with the Securities and Exchange
Genlyte Thomas and Genlyte Commission on July 24, 1998
- - Credit Agreement between Exhibit 10 to Genlyte's Form 10-Q filed
Genlyte Thomas and the with the Securities and Exchange
applicable banks named therein, Commission in November 1998
dated as of August 30, 1998
- - Financial Statements of Exhibits 99.1 through 99.16 to Genlyte's
Business Acquired and Pro Forma Form 8-K/A filed with the Securities and
Financial Information related Exchange Commission on November 5, 1998
to the formation of Genlyte
Thomas
Other Exhibits included herein:
(11) Calculation of Basic and Diluted Earnings per Share
(13) Annual Report to Stockholders
(18) Letter re Change in Accounting Principles
(21) Subsidiaries of the Registrant
(23) Consent of Independent Public Accountants
(27) Financial Data Schedule
(99) Form of Employment Protection Agreement entered into between Genlyte
and certain key executives
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, Genlyte has
duly caused this Annual Report to be signed on its behalf by the undersigned
thereunto duly authorized.
THE GENLYTE GROUP INCORPORATED
Registrant
Date: MARCH 26, 1999
--------------------------- By /s/ WILLIAM G. FERKO
March 26, 1999 ----------------------------------
William G. Ferko
V.P. Finance - CFO & Treasurer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
is signed below by the following persons on behalf of Genlyte and in the
capacities and on the date indicated.
/s/ AVRUM I. DRAZIN
- ---------------------------------------------------- -------------------
Avrum I. Drazin - Chairman of the Board March 26, 1999
/s/ LARRY POWERS
- ---------------------------------------------------- -------------------
Larry Powers, President and Chief Executive Officer March 26, 1999
(Principal Executive Officer)
/s/ GLENN W. BAILEY
- ---------------------------------------------------- -------------------
Glenn W. Bailey - Director March 26, 1999
/s/ ROBERT B. CADWALLADER
- ---------------------------------------------------- -------------------
Robert B. Cadwallader - Director March 26, 1999
/s/ DAVID M. ENGELMAN
- ---------------------------------------------------- -------------------
David M. Engelman - Director March 26, 1999
/s/ FRED HELLER
- ---------------------------------------------------- -------------------
Fred Heller - Director March 26, 1999
/s/ FRANK METZGER
- ---------------------------------------------------- -------------------
Frank Metzger - Director March 26, 1999
15
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
ON FINANCIAL STATEMENT SCHEDULE
We have audited in accordance with generally accepted auditing standards, the
consolidated financial statements included in The Genlyte Group Incorporated
Annual Report to Stockholders for the year ended December 31, 1998, incorporated
by reference in this Form 10-K, and have issued our report thereon dated
February 10, 1999. Our audits were made for the purpose of forming an opinion on
those statements taken as a whole. The schedule listed in Item 14a(2) is the
responsibility of the Company's management and is presented for the purposes of
complying with the Securities and Exchange Commission's rules and is not part of
the basic consolidated financial statements. This schedule has been subjected to
the auditing procedures applied in the audits of the basic consolidated
financial statements and, in our opinion, fairly states in all material respects
the financial data required to be set forth therein in relation to the basic
consolidated financial statements taken as a whole.
/s/ ARTHUR ANDERSEN LLP
------------------------
ARTHUR ANDERSEN LLP
Louisville, Kentucky
February 10, 1999
16
THE GENLYTE GROUP INCORPORATED AND SUBSIDIARIES
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
($ in thousands)
Additions Additions
Balance at From Charged to Balance at
Beginning of Formation of Costs and of End
Year Genlyte Thomas Expenses Deductions* Year
------------ -------------- ---------- ----------- -----------
YEAR ENDED 12/31/98
Allowance for
Doubtful $6,864 $ 1,407 $3,172 $ (536) $10,907
Accounts
YEAR ENDED 12/31/97
Allowance for
Doubtful $8,222 $ -- $2,100 $(3,458) $ 6,864
Accounts
YEAR ENDED 12/31/96
Allowance for
Doubtful $5,302 $ -- $3,452 $ (532) $ 8,222
Accounts
* Deductions include uncollectible accounts written off, less recoveries
of accounts previously written off and effect of foreign currency
translation in accordance with SFAS No. 52.
17