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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
BUTLER MANUFACTURING COMPANY
BMA Tower, Penn Valley Park
(P.O. Box 419917)
Kansas City, Missouri 64141-0917
Telephone: (816) 968-3000
Incorporated in the State of Delaware
COMMISSION FILE NO. 0-603
IRS No. 44-0188420
The Company has no securities registered pursuant to Section 12(g) of the
Act. The only class of stock outstanding consists of Common Stock having no par
value 7,281,998 shares of which were outstanding at December 31, 1998. The
Common Stock and related Preferred Share Purchase Rights are registered pursuant
to Section 12(b) of the Act.
The aggregate market value of the Common Stock of the Company held by
non-affiliates, based upon the last sales price of such stock on February 22,
1999 was $167,473,413.
The Registrant 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
has been subject to such filing requirements for the past 90 days.
As indicated by the following check mark, disclosure of delinquent filers
pursuant to Rule 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:
The following documents are incorporated herein by reference:
(1) Butler Manufacturing Company 1998 Annual Report, pages 14 through 32
(the "Annual Report" incorporated into Part II).
(2) Butler Manufacturing Company Notice of Annual Meeting of Stockholders
and Proxy Statement, dated March 10, 1999 (the "Proxy
Statement" incorporated into Parts I and III).
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BUTLER MANUFACTURING COMPANY
FORM 10-K
-----------
For the Fiscal Year Ended December 31, 1998
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CONTENTS
Page
PART I
Item 1. Business.................................................... 3
Item 2. Properties.................................................. 6
Item 3. Legal Proceedings........................................... 7
Item 4. Submission of Matters to a Vote of Security Holders......... 7
PART II
Item 5. Market for Registrant's Common Equity
and Related Stockholder Matters............................. 7
Item 6. Selected Financial Data..................................... 7
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations............... 8
Item 7A. Quantitative and Qualitative Disclosure About Market
Risk ....................................................... 8
Item 8. Financial Statements and Supplementary Data................. 8
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure...................... 8
PART III
Item 10. Directors and Executive Officers of the Registrant.......... 8
Item 11. Executive Compensation...................................... 10
Item 12. Security Ownership of Certain Beneficial
Owners and Management....................................... 10
Item 13. Certain Relationships and Related Transactions.............. 10
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports
on Form 8-K................................................. 10
SIGNATURES............................................................... 14
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS...................... 16
FINANCIAL STATEMENT SCHEDULES............................................ S-1
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PART I
Item 1.Business
(a) General Description of Business
The Company was founded as a partnership in 1901. It was incorporated in
Missouri in 1902 and reincorporated in Delaware in 1969. Its corporate
headquarters are located in Kansas City, Missouri, and principal plants and
offices are operated throughout the continental United States. Principal
international operations are conducted through Butler Building Systems, Ltd., a
wholly owned United Kingdom subsidiary and Beker Kft, a majority owned Hungarian
joint venture, Butler Shanghai Inc., a Chinese wholly owned subsidiary, Butler
do Brazil Limitada, a South American wholly owned subsidiary and Saudi Building
Systems Ltd. a Saudi Arabian joint venture.
The Company and its subsidiaries are primarily engaged in the marketing,
design and production of systems and components for nonresidential structures.
Products and services fall into four principal business segments: (1) Building
Systems, consisting primarily of custom designed and pre-engineered steel and
wood frame building systems for commercial, community, industrial and
agricultural uses; (2) Architectural Products, consisting primarily of curtain
wall and storefront systems, custom window systems, skylights and roof vents for
low-rise, medium-rise and high-rise nonresidential buildings; (3) Construction
Services, providing construction management services for purchasers of large,
complex or multiple site building projects; and (4) Real Estate, providing
build-to-suit-to-lease development services for corporations who prefer to lease
rather than own their facilities.
The Company's products are sold primarily through independent dealers.
Other Company products are sold through a variety of distribution arrangements.
(b) Financial Information about Industry Segments
The information required by Item 1(b) is incorporated by reference to
pages 25 through 26 of the Company's Annual Report, of which pages 14 through 32
are attached as Exhibit 13.1 to this report. See also items 6, 7, 7A, and 8 of
this report.
(c) Narrative Description of Business
Building Systems
The Company's largest segment, Building Systems, includes the U.S. steel
and wood frame pre-engineered building systems; Butler European operations
consisting of wholly owned subsidiaries in the United Kingdom, France, and
Germany, and Beker Kft., a 90% owned joint venture in Hungary; Butler Shanghai
Inc., a wholly owned Chinese subsidiary, and Butler do Brasil Limitada, a wholly
owned South American subsidiary; and a 30% owned Saudi Arabian joint venture
(Saudi Building Systems, Ltd.)a manufacturer of metal building systems.
The Company's building systems segment consists primarily of custom
designed and pre-engineered one to five-story steel and one to two-story wood
framed buildings for commercial, community, industrial and agricultural uses
such as office buildings, manufacturing facilities, warehouses, schools,
shopping centers, livestock and farm buildings. Principal product components of
the systems are structural members and a variety of pre-engineered wall and
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roof components. These are fabricated according to standard or customer
specifications and shipped to building sites for assembly by independent
dealers. Building components are manufactured in plants located at
Galesburg and Charleston, Illinois; Laurinburg, North Carolina; Birmingham,
Alabama; Visalia, California; Annville, Pennsylvania; San Marcos, Texas;
Lester Prairie, Minnesota; Ottawa, Kansas; and Clear Brook, Virginia.
In December 1997 the Company formed Innovative Building Technology, Inc.
to design, engineer, market and erect panelized buildings for the smaller
commercial buildings segment. Products are manufactured at existing facilities
in Lester Prairie, Minnesota and Ottawa, Kansas.
In December 1998 the Company announced the restructuring of its
International operations leading to the closing of its United Kingdom and
Brazilian pre-engineered steel frame buildings manufacturing plants. In 1999 the
European manufacturing operations will shift to an expanded facility in
Nyiregyhaza, Hungary acquired in late 1996 with the acquisition of a 90%
interest in Beker Kft. European requirements will be provided by the Hungarian
facility and a manufacturing alliance formed with a European supplier.
Saudi Building Systems, Ltd. manufactures pre-engineered steel frame
buildings for Middle Eastern markets at manufacturing facilities located in
Jeddah, Saudi Arabia. The Company serves the Canadian market through a branch
office in Burlington, Ontario.
The U.S. export operation is focused on sales and marketing in the
Central American, Caribbean and select Latin American markets, including
Brazil. Shipments are sourced primarily from Butler's U.S. plants.
Building Systems' products are distributed throughout the world by
independent Butler dealers. The dealers provide construction services and in
many cases complete design and engineering capabilities.
Nonresidential pre-engineered buildings compete with ordinary forms of
building construction in the low-rise commercial, community, industrial and
agricultural markets. Competition is primarily based upon cost, time of
construction, appearance, thermal efficiency, and other specific customer
requirements.
The Company also competes with numerous pre-engineered steel frame
building manufacturers doing business within the United States, Canada, Europe,
South America and China. The Company believes that its 1998 sales of steel frame
pre-engineered building systems within the United States exceeded those of any
other nonresidential steel frame pre-engineered building systems manufacturer,
with its next largest competitors being NCI Building Systems, Inc., V.P.
Buildings (previously Varco-Pruden Buildings), a division of the LTV
Corporation, American Buildings Company and Ceco and Star Buildings Systems
combined, a division of Robertson - Ceco Corporation. Competition among
manufacturers of pre-engineered buildings is based primarily upon price,
service, product design and performance and marketing capabilities.
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Lester Building Systems, the Company's wood frame buildings business,
ranks second in sales to the industry leader, Morton Buildings, Inc., a
manufacturer which sells direct to the end user.
Architectural Products
This segment includes the operations of the Vistawall group which
designs, manufactures and sells aluminum curtain wall systems for mid and
high-rise office markets, entry doors, custom architectural window systems,
translucent roof and wall systems, custom and standard skylights and other
standard storefront products for low-rise retail and commercial markets. In
early 1997 the Vistawall group acquired the assets of Rebco West, Inc., a West
Coast manufacturer and distributor of entrance doors and storefront products. In
June 1997 the Vistawall group acquired the stock of Moduline Windows Inc., a
Wisconsin based manufacturer of architectural window systems for the
nonresidential buildings market. The Vistawall group's products are distributed
on a material supply basis to either curtain wall erection subcontractors or
general contractors, and through distribution warehouses to glazing contractors
for storefront and entry door applications. Manufacturing and distribution
facilities are located in Warwick, Rhode Island; Atlanta and Newnan, Georgia;
Modesto, Hayward and Rancho Cucamonga, California; Cincinnati and Cleveland,
Ohio; Terrell, Houston and Dallas, Texas; Tampa, Florida; Washington, D.C.;
Chicago, Illinois; St. Louis, Missouri; Seattle, Washington; and Wausau,
Wisconsin. In 1997 Vistawall completed the expansion of its Terrell, Texas
operation with the addition of facilities to house a second extrusion press, and
additional painting operations.
The Division operates in highly competitive markets with other national
manufacturers which operate multiple plants and distribution facilities and with
regional manufacturers. Competition is primarily based on price, engineering and
installation capabilities, delivery, appearance and other specific customer
requirements.
Prior to 1997 the Grain Systems Division was included in this business
segment which was previously designated as "Other Building Products". In June
1997 the Company sold its Grain Systems Division which manufactured and marketed
grain storage bins, and also distributed grain conditioning and handling
equipment. The business was sold to CTB, Inc.
Construction Services
The Company's Construction Services segment consists of Butler
Construction, a wholly-owned construction subsidiary formally known as BUCON,
Inc. providing comprehensive design, planning, execution and construction
management services to major purchasers of construction. Butler Heavy Structures
is an operating unit of Butler Construction serving markets requiring large
complex building designs using heavy fabricated mill steel in combination with
Butler's pre-engineered secondary structural and metal cladding systems.
Revenues of the Construction Services segment are derived primarily from general
contracting. In addition, the segment performs "furnish and erect" and
"materials only" subcontracts using products from several Company divisions,
predominantly the Company's Buildings Division. Butler Construction's
competition is primarily based upon price, time necessary to complete a project,
design, and product performance. This business segment competes with
international, national, regional and local general contracting firms, and
whenever possible, performs projects in conjunction with independent Butler
dealers.
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Real Estate
This business segment consists soley of Butler Real Estate, Inc., a
wholly-owned subsidiary of the Company, and provides value-added real estate
development and leasing services to major corporations in cooperation with
Butler dealers. Butler Real Estate functions as a development and financing
source during the lead procurement and construction process. On the basis of
commitments to lease obtained from credit worthy customers, Butler Real Estate,
Inc., acquires building sites, arranges with Butler dealers for construction of
build-to-suit projects, then sells the completed projects to permanent investors
when the facilities are occupied by lessees.
Manufacturing and Materials
The Company's manufacturing facilities include most conventional metal
fabricating operations, such as punching, shearing, welding, extruding and
forming of sheet and structural steel and aluminum. The Company also operates
painting and anodizing lines for structural steel and aluminum components,
respectively. Wood frame manufacturing operations include sawing and truss
fabrication. The principal materials used in the manufacture of Company products
include steel, aluminum, wood and purchased parts. Materials are presently
available in sufficient quantities to meet current Company needs.
Seasonal Business
Historically, the Company's sales and net earnings have been affected by
cycles in the general economy which influence nonresidential construction
markets (see in particular Item 7 of this report). The Company also experiences
seasonal demand for products and services. Sales for the first, second, third,
and fourth quarters of 1998 were $194 million, $239 million, $268 million, and
$262 million, respectively.
Backlog
The Company's backlog of orders believed to be firm was $317 million at
December 31, 1998, up 11% from a year ago.
Employees
At December 31, 1998 the Company employed 5,171 persons, 4,268 of whom
were non-union employees, and 903 were hourly paid employees who were members of
three unions. At December 31, 1997 the Company employed 5,117 persons.
Item 2.Properties
The principal plants and physical properties of the Company consist of the
manufacturing facilities described under Item 1 and the Company's executive
offices in Kansas City. Through a subsidiary, the Company also owns a land
development venture with property located on approximately an 85 acre site in
San Marcos, Texas. The property is recorded as "Assets held for sale" and
described in a footnote on page 25 in the Company's Annual Report. All other
plants and offices described under Item 1 are utilized by the Company and are
generally suitable and adequate for the business activity conducted therein. The
Company's manufacturing facilities described under Item 1, along with current
outsourcing agreements with various domestic and foreign fabricators, provide
production capabilities sufficient to meet current and foreseeable needs.
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Except for leased facilities listed below, all of the Company's principal
plants and offices are owned:
(1) Leased space used for the Company's executive offices in Kansas City,
Missouri (122,000 sq. ft. lease expiring in the year 2001 with an option
to renew).
(2) Leased space used for the Vistawall Division plant in Terrell, Texas
(145,000 sq. ft. and 121,000 sq. ft. with leases expiring in 2000 and
2006, respectively, both containing options to renew), and fabrication
and distribution facilities in Dallas and Houston, Texas; St. Louis,
Missouri; Chicago, Illinois; Washington, D.C.; Cincinnati and Cleveland,
Ohio; Atlanta and Newnan, Georgia; Tampa, Florida; Seattle, Washington;
Modesto, Hayward, and Rancho Cucamonga, California; Warwick, Rhode
Island; and Denver, Colorado (483,000 sq. ft. leased with various
expiration dates).
(3) Leased space used for Bucon, Inc. and Innovative Building Technology
offices in Kansas City, Missouri (74,000 sq. ft. lease expiring in the
year 2007).
(4) The Company also leases various sales offices throughout the world.
Item 3. Legal Proceedings.
There are no material legal or environmental proceedings pending as of
March 10, 1999, nor does the Company have any known material environmental
contingencies as of this date. Proceedings which are pending consist of matters
normally incident to the business conducted by the Company and taken together do
not appear to be material.
Item 4. Submissions of Matters to a Vote of Security Holders.
No matters have been submitted to a vote of stockholders since the last
annual meeting of stockholders on April 21, 1998
PART II
Item 5. Market for Registrant's Common Equity and Related Stockholder
Matters.
Incorporated by reference to the information under "Quarterly Financial
Information (Unaudited)", "Price Range of Common Stock (Unaudited)" and
"Historical Review 1998-1994" on pages 31 and 32 of the Annual Report.
In September 1998 the Company increased its cash dividend from 14 cents
to 15 cents per share to shareholders of record as of October 1. The Company has
limited restrictions on the payment of dividends based on certain debt covenants
of Note Agreements dated June 1, 1994, between the Company and four insurance
companies and the Note Agreement dated March 1, 1998, with an insurance company
(incorporated by reference to the Forms 10-Q for the quarters ended June 30,
1994, and March 31, 1998 as indicated under Item 14). The Company had
approximately $13 million of retained earnings available for cash dividends at
December 31, 1998.
Item 6. Selected Financial Data.
Incorporated by reference to the information under "Historical Review
1998-1994" on page 32 of the Annual Report.
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Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Incorporated by reference to the information under "Management's
Discussion and Analysis of Financial Condition and Results of Operations" on
pages 14 through 17 of the Annual Report.
Item 7A. Quantitative and Qualitative Disclosure About Market Risk.
Incorporated by reference to page 15 of the Annual Report to the
information under "Management's Discussion and Analysis of Financial Condition
and Results of Operations".
Item 8. Financial Statements and Supplementary Data.
Incorporated by reference to the consolidated financial statements and
related notes on pages 18 through 32 of the Annual Report.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
On April 15, 1997, the Audit Committee of the Board of Directors of the
Company, chose to engage Arthur Andersen LLP as independent accountants to audit
the financial statements of the Company rather than reengage KPMG LLP.
The report of KPMG LLP for the year ending December 31, 1996, contains
no adverse opinion or disclaimer of opinion and was not qualified or modified as
to uncertainty, audit scope or accounting principles. Subsequent to December 31,
1996 there have been no disagreements between the Butler Manufacturing Company
and KPMG LLP.
PART III
Item 10. Directors and Executive Officers of the Registrant.
Information as to Directors is incorporated herein by reference to pages
2 through 5 of the Proxy Statement. The Executive Officers, their ages, their
positions and offices with the Company and their principal occupations during
the past five years are shown below:
Corporate Executive Officers
Robert H. West - age 60, Chairman of the Board and Chairman of the Executive
Committee. He joined the Company in 1968, became President in 1978 and Chairman
of the Board and Chief Executive Officer in 1986. He relinquished his CEO
responsibilities on January 19, 1999. Mr. West is a director of Commerce
Bancshares, Inc., Burlington Northern Santa Fe Corporation, Kansas City Power &
Light Company, and Saint Luke's Shawnee Mission Health System. He is a trustee
of the University of Missouri at Kansas City.
John J. Holland - age 48, President and Chief Executive Officer and member of
the Board Executive Committee; He joined Butler in 1980 and became Vice
President - Controller in 1986, Vice President-Finance in 1990, Executive Vice
President in 1998 and President and Chief Executive Officer in 1999. Mr. Holland
is a director of Commerce Fund, a mutual fund; an advisory director of Allendale
Insurance Company, and a director of Saint Luke's Hospital. He is a former
chairman of Heart of America Family Services.
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Donald H. Pratt - age 61, Vice Chairman and member of the Board Executive
Committee; has been a director since 1979. He joined Butler in 1965, became
Executive Vice President in 1980, President of the Company in 1986 and Vice
Chairman in 1999. Mr. Pratt is also a director of American Century Mutual Funds,
a director of Atlas-Copco North America Inc. and is a trustee of the Midwest
Research Institute.
Richard S. Jarman - age 52, Executive Vice President since 1999. He joined the
Company in 1974 and became President of the Buildings Division in 1986. Mr.
Jarman is a director and former chairman of the Metal Buildings Manufacturers
Association and a member if its Executive Committee, and a director of
Mid-America Coalition on Health Care. He is a past chairman of INROADS, Kansas
City.
Richard O. Ballentine - age 62, Vice President, General Counsel, and Secretary
since 1978. He joined Butler in 1975 as Vice President-Legal.
Barbara B. Bridger - age 41, Vice President- Human Resources since 1998. She
joined Butler in 1980 and previously was Vice President- Human Resources for the
Buildings Division.
John T. Cole - age 48, Controller since 1990. He joined Butler in 1977 and
previously was Corporate Audit Manager.
John W. Huey - age 51, Vice President-Administration since 1993 and Assistant
General Counsel and Assistant Secretary since 1987. He joined Butler in 1978.
Paul F. Liljegren - age 44, Treasurer since 1998. He joined Butler in 1979 and
previously was Vice President and Controller of Lester Building Systems.
Larry C. Miller - age 42, Vice President-Finance since 1998. He joined Butler
in 1980 and became Assistant Treasurer in 1985 and Treasurer in 1989.
Division Executive Officers
Moufid (Mike) Alossi - age 56, President, Butler Shanghai Inc., since 1997. He
joined Butler in 1968 and was previously President of Butler World Trade and
Vice President-International Sales and Marketing.
Hans G. Berger - age 51, Managing Director, Butler Europe since 1995. He
previously was Managing Director, Butler Bausysteme GmbH from 1993 to 1995 and
Vice President-Engineering, Butler Canada from 1986 to 1992.
Marc S. Hafer - age 41, President, Lester Building Systems since 1996. From 1993
to 1996 he was President of Walker Systems, Inc., a subsidiary of Wiremold, Inc.
He was Vice President-Sales and Marketing of the Company's Walker Division from
1991 to 1993. He first joined Butler in 1988.
Thomas J. Hall - age 53, President, Butler Real Estate, Inc. since 1991. He
joined Butler in 1969, and was named Vice President and General Manager of
Butler Real Estate, Inc. in 1987.
Charles E. Hatch - age 51, Managing Director, Butler do Brasil, Ltda since 1997.
He first joined Butler in 1981.
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William L.Johnsmeyer - age 51, President Butler Construction (Bucon, Inc.) since
1990. He joined Butler in 1982 and became President, Walker Division in 1984.
Ronald E. Rutledge - age 57, President Vistawall Division since 1984 when he
joined Butler.
Clyde E. Wills, Jr. - age 53, President, Buildings Division since 1999. He
first joined Butler in 1972. He previously was Senior Vice President of
Operations, Building Division from 1992 to 1997 and was President, International
Division.
Lavon Winkler - age 42, President, Innovative Building Technology since 1999. He
first joined Butler in 1979 and became Operations Manager, Innovative Building
Technology in 1998.
Item 11. Executive Compensation.
Incorporated by reference to the information under "Report on Executive
Compensation", "Summary Compensation Table", "Option Grants During 1998",
"Aggregated Option Exercises and Fiscal Year-End Option Value Table", and
"Pension Plan Table" on pages 9 through 14 of the Proxy Statement.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
Incorporated by reference to the information under "Beneficial Ownership
Table" on pages 7 through 8 of the Proxy Statement.
Item 13. Certain Relationships and Related Transactions.
Incorporated by reference to the information under "Election of Class
C Directors" on pages 2 through 10 and "Report on Executive Compensation" in
the Proxy Statement.
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on
Form 8-K.
The following documents are filed as part of this report:
(a) Financial Statements:
- "Report of Independent Public Accountants" for the two-year period
ended December 31, 1998 and "The Report of Independent Public
Accountants" for the year ended December 31, 1997.
- Consolidated Balance Sheets as of December 31, 1998 and 1997.
- Consolidated Statements of Earnings and Retained Earnings for years
Ended December 31, 1998, 1997 and 1996. - Consolidated Statements of
Comprehensive Income for years ended December 31,1998, 1997, and 1996
- Consolidated Statements of Cash Flows for years ended December 31,
1998, 1997 and 1996.
- Notes to Consolidated Financial Statements.
The foregoing have been incorporated by reference to the Annual Report
as indicated under Item 8.
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(b) Financial Statement Schedules:
Auditors' Reports on Financial Statement and Schedule II, Valuation
and Qualifying Accounts.
All other schedules are omitted because they are not applicable or
the information is contained in the consolidated financial statements
or notes thereto.
(c) Exhibits:
3.1 Restated Certificate of Incorporation (incorporated by reference
to Exhibit 3.1 to Company's form 10-Q for the quarter ended, March 31,
1996).
3.2 Bylaws of Butler Manufacturing Company as amended effective January
19, 1999.
4.1 Note Agreement between the Company and four Insurance Companies
dated as of June 1, 1994 (incorporated by reference to Exhibit 4 of
the Company's Form 10-Q for the quarter ended June 30, 1994).
4.2 Note Agreement between the Company and an Insurance Company dated
as of March 1, 1998 (incorporated by reference to Exhibit 4 of the
Company's Form 10-Q for the quarter ended March 31, 1998).
10.1 Butler Manufacturing Company Executive Deferred Compensation
Plan as amended (incorporated by reference to Exhibit 10.2 to the
Company's Form 10-K for the year ended December 31, 1989). 10.2
Butler Manufacturing Company Stock Incentive Plan for 1987, as
amended (incorporated by reference to Exhibit 10.1 to the
Company's Form 10-K for the year ended December 31, 1990).
10.3 Butler Manufacturing Company Stock Incentive Plan of 1979, as
amended (incorporated by reference to Exhibit 10.2 to the Company's
Form 10-K for the year ended December 31, 1990).
10.4 Form of Change of Control Employment Agreements, as amended, between
the Company and each of six executive officers (incorporated by
reference to Exhibit 10.3 to the Company's Form 10-K for the year
ended December 31, 1990).
10.5 Copy of Butler Manufacturing Company Supplemental Benefit Plan as
amended and restated (incorporated by reference to Exhibit 10.5 to
the Company's Form 10-K for the year ended December 31, 1994).
10.6 Form of Butler Manufacturing Company Split Dollar Life Insurance
Agreement (Collateral Assignment Method; Bonus Arrangement) entered
into between the Company and certain executive officers
(incorporated by reference to Exhibit 10.6 to the Company's Form
10-K for the year ended December 31, 1994).
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10.7 Form of Butler Manufacturing Company Split Dollar Life Insurance
Agreement (Collateral Assignment Method; Roll Out Arrangement)
entered into between the Company and certain executive officers
(incorporated by reference to Exhibit 10.7 to the Company's Form
10-K for the year ended December 31, 1994).
10.8 Butler Manufacturing Company Stock Incentive Plan of 1996
(incorporated by reference to Exhibit 4(a) to the Company's
Registration Statement Number 333-02557 on S-8 filed April 17,
1996).
10.9 Butler Manufacturing Company Director Stock Compensation Program
(incorporated by reference to Exhibit 10.9 to the Company's
December 31, 1997 Form 10-K).
10.10 Butler Manufacturing Company Restricted Stock Compensation
Program of 1996 (incorporated by reference to Exhibit 10.10 to the
Company's December 31, 1997 Form 10-K).
10.11 Asset Purchase Agreement dated March 31, 1997 between Butler
Manufacturing Company and CTB, Inc. relating to the sale of the
Company's Grain Systems Division (incorporated by reference to
Exhibit (2) to the Company's form 8-K dated June 23, 1997.
13.1 Butler Manufacturing Company 1997 Annual Report Pages 14 through
32 only (the information expressly incorporated herein by
reference).
13.2 KPMG LLP's "Report of Independent Public Accountants" for the
year ended December 31, 1996.
22.0 Set forth below is a list as of February 19, 1999 of subsidiaries
of the Company and their respective jurisdictions of incorporation.
Subsidiaries not listed, when considered in the aggregate as a
single subsidiary, do not constitute a significant subsidiary.
Jurisdiction of
Subsidiary Incorporation
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Butler Argentina, S.A. Argentina
Butler do Brasil Limitada Brazil
Butler Export, Inc. Barbados
Butler Building Systems, Ltd. Scotland
Butler Europe GmbH Germany
Butler Systemes de Construction SARL France
BMC Real Estate, Inc. Delaware
BUCON, Inc. Delaware
Butler Pacific, Inc. Delaware
Butler Real Estate, Inc. Delaware
Butler, S.A. de C.V. Mexico
Butler (Shanghai) Inc. China
Butler Holdings, Inc. Delaware
Beker Kft Hungary
Comercial Butler Limitada Chile
Innovative Building Technology, Inc. Delaware
Lester's of Minnesota, Inc. Minnesota
Lester Holdings, Inc. Delaware
Moduline Windows, Inc. Wisconsin
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23.1 Consent of Arthur Andersen LLP (incorporated by reference to page
16 of this report).
23.2 Consent of KPMG LLP (incorporated by reference to page 17 of this
report).
24.0 Power of Attorney to sign this Report by each director.
27.0 Financial Data Schedule.
The Company filed a report on Form 8-K on January 7, 1999 disclosing an
announced restructuring and asset impairment charge in the fourth quarter. It
also announced an authorization by the Board of Directors to purchase shares of
Company stock from time to time, replacing a prior authorization announced in
June, 1997.
The calculation of the aggregate market value the Company's Common Stock
held by non-affiliates shown on the front of the cover page assumes that
directors are affiliates. Such assumption does not reflect a belief by the
Company or any director that any director is an affiliate of the Company.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized on this 25th day of
March, 1999.
BUTLER MANUFACTURING COMPANY
BY /S/ John J. Holland
_____________________________
John J. Holland
President-CEO
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant in the capacities indicated on the dates indicated.
/S/ Robert H. West Chairman of the Board March 25, 1999
- ------------------------------
Robert H. West
/S/ Donald H. Pratt Vice Chairman-Director March 25, 1999
- ------------------------------
Donald H. Pratt
/S/ John J. Holland President-CEO March 25, 1999
- ------------------------------ (Principal Executive Officer)
John J. Holland
/S/ Richard S. Jarman Executive VP March 25, 1999
- ------------------------------
Richard S. Jarman
/S/ Larry C. Miller Vice President-Finance March 25, 1999
- ------------------------------ (Principal Financial Officer)
Larry C. Miller
/S/ John T. Cole Controller March 25, 1999
- ------------------------------ (Principal Accounting Officer)
John T. Cole
/S/ Harold G. Bernthal * Director March 24, 1999
- ------------------------------
Harold G. Bernthal
/S/ Gary M. Christensen * Director March 24, 1999
- ------------------------------
Gary M. Christensen
/S/ Alan M. Hallene * Director March 24, 1999
- ------------------------------
Alan M. Hallene
/S/ C.L. William Haw * Director March 24, 1999
- ------------------------------
C.L. William Haw
/S/ Robert J. Novello * Director March 24, 1999
- ------------------------------
Robert J. Novello
/S/ Robert J. Reintjes, Sr. * Director March 24, 1999
- ------------------------------
Robert J. Reintjes, Sr.
/S/ Judith A. Rogala * Director March 24, 1999
- ------------------------------
Judith A. Rogala
/S/ Gary L. Tapella * Director March 24, 1999
- ------------------------------
Gary L. Tapella
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Richard O. Ballentine, by signing his name hereto, does hereby sign this report
on Form 10-K on behalf of each of the directors of the Registrant pursuant to a
power of attorney executed by each of such directors.
* By /S/ Richard O. Ballentine, Attorney-in-fact March 24, 1999
______________________________________________
Richard O. Ballentine, Attorney-in-fact
15
17
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Butler Manufacturing Company
As independent public accountants, we hereby consent to the incorporation by
reference of our report dated January 25, 1999, appearing on page 17 of Butler
Manufacturing Company's 1998 Annual Report, which is incorporated in the Form
10-K, into the Company's previously filed Registration Statements on Form S-8
(Nos. 33-14464, 2-63830, 2-55753, 333-02285, 333-02557 and 2-36370). (We also
consent to the incorporation in our report dated January 25, 1999, on the
Financial Statement Schedule, appearing in item 14 of Form 10-K.) It should be
noted that we have not audited any financial statements of Butler Manufacturing
Company subsequent to December 31, 1998, or performed any audit procedures
subsequent to the date of our report.
/S/ ARTHUR ANDERSEN LLP
_______________________
ARTHUR ANDERSEN LLP
Kansas City, Missouri,
March 26, 1999
16
18
We consent to the incorporation by reference in Registration Statement Nos.
33-14464, 2-63830, 2-55753, 333-02285, 333-02557 and 2-36370 on Form S-8 and the
related Prospectus of June 11, 1987, with Appendix dated March 8, 1996, of
Butler Manufacturing Company of our report dated February 3, 1997 relating to
the consolidated statements of earnings and cash flows and the related schedule
of Butler Manufacturing Company and subsidiaries for the year ended December 31,
1996, which report appears in or is incorporated by reference in the Annual
Report on Form 10-K of Butler Manufacturing Company for the fiscal year ended
December 31, 1998. We also consent to the reference to our firm under the
heading "Experts" in the Prospectus to the Registration Statements.
/S/ KPMG LLP
_____________
KPMG LLP
Kansas City, Missouri
March 25, 1999.
17
19
BUTLER MANUFACTURING COMPANY AND SUBSIDIARIES
KANSAS CITY, MISSOURI
Consolidated Financial Statement Schedules
(Form 10-K)
December 31, 1998, 1997 and 1996
(With Auditors' Reports Thereon)
S-1
20
INDEPENDENT AUDITORS' REPORT
To the Shareholders of Butler Manufacturing Company:
We have audited in accordance with generally accepted auditing standards, the
consolidated financial statements included in Butler Manufacturing Company's
1998 Annual Report to shareholders, which is incorporated by reference in this
Form 10-K, and have issued our report thereon dated January 25, 1999. Our audit
was made for the purpose of forming an opinion on those statements taken as a
whole. The Financial Statement Schedule listed in item 14 is presented for the
purpose of complying with the Securities and Exchange Commission's rules and is
not part of the basic financial statements. This schedule has been subjected to
the auditing procedures applied in the audit of the basic consolidated financial
statements and, in our opinion, fairly states in all material aspects the
financial data required to be set forth in relation to the basic consolidated
financial statements taken as a whole.
/S/ ARTHUR ANDERSEN LLP
_______________________
ARTHUR ANDERSEN LLP
Kansas City, Missouri,
January 25, 1999
S-2
21
The Board of Directors
Butler Manufacturing Company:
Under date of February 3, 1997, we reported on the consolidated balance sheet of
Butler Manufacturing Company and subsidiaries as of December 31, 1996, and the
related consolidated statements of earnings and retained earnings and cash flows
for the year ended December 31, 1996, as contained in the 1998 Annual Report.
These consolidated financial statements and our report thereon are incorporated
by reference or included in the report on form 10-K for the year 1998. In
connection with our audits of the aforementioned consolidated financial
statements, we also audited the related consolidated financial statement
schedule as of December 31, 1996 and 1995 and for the years then ended as listed
in item 14. This consolidated financial statement schedule is the responsibility
of the Company's management. Our responsibility is to express an opinion on this
consolidated financial statement schedule based on our audits.
In our opinion, such schedule, when considered in relation to the basic 1996
consolidated financial statements taken as a whole, presents fairly, in all
material aspects, the information set forth therein.
/S/ KPMG LLP
____________
KPMG LLP
Kansas City, Missouri
February 3, 1997
S-3
22
SCHEDULE II
BUTLER MANUFACTURING COMPANY AND SUBSIDIARIES
Valuation and Qualifying Accounts
(Thousands of Dollars)
Balance at Charged Balance
beginning to at end
Description of year earnings Other Deductions of year
_________________________ __________ ________ _____ __________ _______
(A)
Allowance for Losses
on Accounts Receivable:
1998 $2,473 $2,772 -- $1,454 $3,791
1997 $2,918 $ 887 $ 198 $1,530(B) $2,473
1996 $2,348 $1,344 $ 470 $1,244 $2,918
Restructuring Reserve:
1998 -- $2,409 -- $ 132 $2,277
1997 -- -- -- -- --
1996 -- -- -- -- --
(A) Includes transfers from other reserve accounts.
(B) Includes write-off of $293.0 thousand in 1997 for the sale of the Grain
Systems Division.
S-4
23
EXHIBIT INDEX
EXHIBITS DESCRIPTION
________ ___________
3.1 Restated Certificate of Incorporation (incorporated by
reference to Exhibit 3.1 to Company's form 10-Q for the
quarter ended, March 31, 1996).
3.2 Bylaws of Butler Manufacturing Company as amended effective
January 19, 1999.
4.1 Note Agreement between the Company and four Insurance
Companies dated as of June 1, 1994 (incorporated by reference
to Exhibit 4 of the Company's Form 10-Q for the quarter ended
June 30, 1994).
4.2 Note Agreement between the Company and an Insurance Company
dated as of March 1, 1998 (incorporated by reference to
Exhibit 4 of the Company's Form 10-Q for the quarter ended
March 31, 1998).
10.1 Butler Manufacturing Company Executive Deferred Compensation
Plan as amended (incorporated by reference to Exhibit 10.2 to
the Company's Form 10-K for the year ended December 31, 1989).
10.2 Butler Manufacturing Company Stock Incentive Plan for 1987, as
amended (incorporated by reference to Exhibit 10.1 to the
Company's Form 10-K for the year ended December 31, 1990).
10.3 Butler Manufacturing Company Stock Incentive Plan of 1979, as
amended (incorporated by reference to Exhibit 10.2 to the
Company's Form 10-K for the year ended December 31, 1990).
10.4 Form of Change of Control Employment Agreements, as amended,
between the Company and each of six executive officers
(incorporated by reference to Exhibit 10.3 to the Company's
Form 10-K for the year ended December 31, 1990).
10.5 Copy of Butler Manufacturing Company Supplemental Benefit
Plan as amended and restated (incorporated by reference to
Exhibit 10.5 to the Company's Form 10-K for the year ended
December 31, 1994).
10.6 Form of Butler Manufacturing Company Split Dollar Life
Insurance Agreement (Collateral Assignment Method; Bonus
Arrangement) entered into between the Company and certain
executive officers (incorporated by reference to Exhibit 10.6
to the Company's Form 10-K for the year ended December 31,
1994).
10.7 Form of Butler Manufacturing Company Split Dollar Life
Insurance Agreement (Collateral Assignment Method; Roll Out
Arrangement) entered into between the Company and certain
executive officers (incorporated by reference to Exhibit 10.7
to the Company's Form 10-K for the year ended December
31,1994).
24
10.8 Butler Manufacturing Company Stock Incentive Plan of 1996
(incorporated by reference to Exhibit 4(a) to the Company's
Registration Statement Number 333-02557 on S-8 filed April 17,
1996).
10.9 Butler Manufacturing Company Director Stock Compensation
Program (incorporated by reference to Exhibit 10.9 to the
Company's December 31, 1997 Form 10-K).
10.10 Butler Manufacturing Company Restricted Stock Compensation
Program of 1996 (incorporated by reference to Exhibit 10.10 to
the Company's December 31, 1997 Form 10-K).
10.11 Asset Purchase Agreement dated March 31, 1997 between Butler
Manufacturing Company and CTB, Inc. relating to the sale of
the Company's Grain Systems Division (incorporated by
reference to Exhibit (2) to the Company's form 8-K dated June
23, 1997.
13.1 Butler Manufacturing Company 1997 Annual Report Pages 14
through 32 only (the information expressly incorporated herein
by reference).
13.2 Report of Independent Public Accountants for the year ended
December 31, 1996.
22.0 Set forth below is a list as of February 19, 1999 of
subsidiaries of the Company and their respective jurisdictions
of incorporation. Subsidiaries not listed, when considered in
the aggregate as a single subsidiary, do not constitute a
significant subsidiary.
Jurisdiction of
Subsidiary Incorporation
---------- -------------
Butler Argentina, S.A. Argentina
Butler do Brasil Limitada Brazil
Butler Export, Inc. Barbados
Butler Building Systems, Ltd. Scotland
Butler Europe GmbH Germany
Butler Systemes de Construction SARL France
BMC Real Estate, Inc. Delaware
BUCON, Inc. Delaware
Butler Pacific, Inc. Delaware
Butler Real Estate, Inc. Delaware
Butler, S.A. de C.V. Mexico
Butler (Shanghai) Inc. China
Butler Holdings, Inc. Delaware
Beker Kft Hungary
Comercial Butler Limitada Chile
Innovative Building Technology, Inc. Delaware
Lester's of Minnesota, Inc. Minnesota
Lester Holdings, Inc. Delaware
Moduline Windows, Inc. Wisconsin
23.1 Consent of Arthur Andersen LLP (incorporated by reference to
page 16 of this report).
23.2 Consent of KPMG LLP (incorporated by reference to page 17 of
this report).
24.0 Power of Attorney to sign this Report by each director.
27.0 Financial Data Schedule.