1994 Annual Report

A. Accounting Policies
Principles of Consolidation - The consolidated financial statements include the accounts of Bethlehem Steel Corporation and all majority-owned subsidiaries and joint ventures.

Cash and Cash Equivalents - Cash equivalents consist primarily of overnight investments, certificates of deposit and other short-term, highly liquid instruments generally with original maturities at the time of acquisition of three months or less. Cash equivalents are stated at cost plus accrued interest, which approximates market.

Inventories - Inventories are valued at the lower of cost (principally FIFO) or market. Contract work in progress is valued at cost less billings. Estimated losses are recognized when first apparent and partial profits are based on percentage of completion.

Investments - Investments in associated enterprises accounted for by the equity method were $47 million and $59 million at December 31, 1994 and 1993. Associated enterprises are primarily 50% or less interests in steel sheet coating and mining operations.

Property, Plant and Equipment - Property, plant and equipment is stated at cost. Maintenance, repairs and renewals which neither materially add to the value of the property nor appreciably prolong its life are charged to expense. Gains or losses on dispositions of property, plant and equipment are recognized in income. Interest is capitalized on significant construction projects and totaled $31, $9 and $17 million in 1994, 1993 and 1992.

Our property, plant and equipment by major classification is:

(Dollars in millions)		1994		1993

 (Dollars in millions)		    1994 	    1993
Land (net of depletion)		    $38.8	    $50.9
Buildings			    682.9	    670.1
Machinery and equipment:
Steel manufacturing		  5,364.8	  4,960.2
Other				    639.2	    739.5
				  6,725.7	  6,420.7
Accumulated depreciation	 (4,167.9)	 (4,107.0)
				  2,557.8	  2,313.7
Construction-in-progress	    201.5 	    320.6
Total				$ 2,759.3	$ 2,634.3

Depreciation - Depreciation, which includes amortization of assets under capital leases, is based upon the estimated useful lives of each asset group. The estimated useful life is 18 years for most steel producing assets. Steel assets, other than blast furnace linings, and most raw material producing assets are depreciated on a straight-line basis adjusted by an activity factor. This factor is based on the ratio of production and shipments for the current year to the average production and shipments for the current and preceding four years at each operating location. Annual depreciation after adjustment for this activity factor is not less than 75% nor more than 125% of straight-line depreciation. Depreciation after adjustment for this activity factor was $10 million more than straight-line in 1994 and $4 million more than straight-line in 1993 and $6 million less than straight-line in 1992. Through December 31, 1994, $28 million less accumulated depreciation has been recorded under this method than would have been recorded under straight-line depreciation.

The cost of blast furnace linings is depreciated on a unit-of-production basis. All other assets are depreciated on a straight-line basis.

Foreign Currency, Interest Rate and Commodity Price Risk Management - Periodically, we enter into (1) foreign currency exchange contracts principally to manage the cost of firm purchase commitments for capital equipment or other purchased goods and services denominated in a foreign currency, (2) interest rate swap agreements to fix the interest rate on certain floating rate debt and (3) commodity (principally natural gas, zinc and other metals) contracts to fix the cost of a portion of our related annual requirements. Generally, foreign currency and commodity contracts are for periods of less than a year. The gains or losses on these contracts are reflected in the cost of goods or services purchased. Net payments or receipts on interest rate swaps are reflected in interest expense. Gains or losses on swaps settled or terminated are deferred and amortized to interest expense over the life of the related debt. Currency and commodity contracts outstanding during the years and at year end were not material. Also, see Note F, Long-term Debt and Capital Lease Obligations.

B. Accounting Changes
During 1992, we adopted two new Financial Accounting Standards Board Statements, No. 106, Accounting for Postretirement Benefits Other Than Pensions and No. 109, Accounting for Income Taxes. The cumulative effect of these changes in accounting recorded as of January 1, 1992 was a $340 million net charge to income. Prior years' financial statements were not restated for these changes.

Statement No. 106 requires postretirement benefits other than pensions, principally health care and life insurance, to be accrued as an expense over the period active employees become eligible for the benefits. Previously, such retiree benefits were generally expensed as claims were incurred. The cumulative effect of adopting Statement No. 106 was a $745 million charge, net of a $380 million deferred income tax benefit.

Statement No. 109 requires financial statements to reflect deferred taxes for the future tax consequences of events recognized in different years for financial reporting and tax reporting purposes. The cumulative effect of adopting Statement No. 109 was a $405 million credit for the net deferred income tax asset.

C. Industry Segment Information

(Dollars in millions)	   1994		   1993		   1992
Sales:
Trade:
Basic Steel Operations	$4,702.4	$4,217.5	$3,849.7
Steel Related 
Operations		   117.0	   105.9	   158.2
Intersegment:
Basic Steel Operations	     3.8	     1.7	     8.1
Steel Related 
Operations		    19.4	    13.7	    21.6
Eliminations		   (23.2)  	   (15.4)	   (29.7)
Total			$4,819.4	$4,323.4	$4,007.9
Estimated Restructuring Losses:
Basic Steel Operations	$		  $350.0	$    -
Income (Loss) from 
Operations:
Basic Steel Operations	$  166.0	$ (273.6)	$ (214.3)
Steel Related 
Operations		   (32.4)	   (21.6)	    11.3
Total			  $133.6	$ (295.2)	$ (203.0)
Shipments (tons in thousands):
Basic Steel Operations	 9,251		 8,997		 8,431
Identifiable Assets:
Basic Steel Operations	$4,106.0	$3,930.6	$3,896.3
Steel Related 
Operations		   102.7	   119.9	   139.0
Corporate		 1,573.7	 1,826.2	 1,457.7
Total			$5,782.4	$5,876.7	$5,493.0
Depreciation:
Basic Steel Operations	$  252.6	$  271.9	$  256.0
Steel Related 
Operations		     8.5	     5.6	     5.7
Total			$  261.1	$  277.5	$  261.7
Capital Expenditures:
Basic Steel Operations 	$  432.1	$  323.8	$  325.8
Steel Related 
Operations		    12.5	     3.3	     2.9
Total			$  444.6	$  327.1	$  328.7

Intersegment sales are generally at market prices. Corporate assets consist primarily of cash and cash equivalents, investments, deferred income tax asset and intangible asset pensions.

D. Estimated Restructuring Losses
On January 26, 1994, we announced a revised modernization plan for our Bethlehem Structural Products subsidiary that phases out the production of raw steel and heavy structural shapes in 1995. In total, we now expect to reduce our workforce by 1,700 employees by 1996. Also, based on our review of the current and projected coke market, we concluded that we could not recover both the remaining book value and required future investment if we rebuild and operate the coke plant at our Sparrows Point Division that was idled in 1991. Accordingly, we recorded a restructuring loss in 1993 of $350 million ($290 million after-tax or $3.19 per share). This loss included $215 million for the net book value of certain equipment, $115 million for employee benefit related costs ($75 million for pensions, $20 million for postretirement benefits other than pensions and $20 million for severance and other benefits) and $20 million for future contractual and other costs. The amounts for severance and other costs charged to the restructuring liability in 1994 were not significant.

E. Taxes
Our benefit (provision) for income taxes consisted of:

(Dollars in millions)	  1994		1993		1992
Federal-deferred	$(13.0)		$87.0		$45.0
State and foreign-
current 	 	  (1.0)		 (2.0)		  -
Total benefit 
(provision)		$(14.0)		$85.0		$45.0
The benefit (provision) for income taxes differs from the amount 
computed by applying the federal statutory rate to pre-tax income 
(loss). The computed amounts and the items comprising the total 
differences follow: 
(Dollars in millions)	 1994		  1993		  1992
Pre-tax income (loss):
United States 		$ 86.9		$(353.3)	$(260.4)
Foreign			   7.6		    2.0		    5.1
Total			$ 94.5		$(351.3)	$(255.3)
Computed amounts	$(33.1)	 	$ 123.0		$  86.8
Effect of change in rate
on prior years (a)	    -		   50.0		     -
Valuation allowance	  13.0		  (87.0)	  (50.4)
Percentage depletion	   7.7		    5.6		    6.8
Dividend received 
deduction		   2.6		    2.4		    2.7
State and foreign taxes	  (1.0)		   (2.0)	     -
Other differences-net	  (3.2)		   (7.0)	    (.9)
Total benefit 
(provision)		$(14.0)	  	$  85.0		$  45.0

The components of our net deferred income tax asset are as follows:

(Dollars in millions)		1994		1993
Temporary differences:
Employee benefits		$ 870		$ 980
Depreciable assets		 (250)		 (240)
Other				   66		   44
	Total			  686		  784
Operating loss carryforward	  600		  550
Deferred income tax asset	1,286		1,334
Valuation allowance		 (383)		 (407)
Deferred income tax asset-net	$ 903		$ 927

Temporary differences represent the cumulative taxable or deductible amounts recorded in our financial statements in different years than recognized in our tax returns. Our employee benefits temporary difference includes amounts expensed in our financial statements for pensions, health care, life insurance and other postretirement benefits which become deductible in our tax return upon payment or funding in qualified trusts. The depreciable assets temporary difference represents generally tax depreciation in excess of financial statement depreciation. Other temporary differences represent principally various expenses accrued for financial reporting purposes which are not deductible for tax reporting purposes until paid. At December 31, 1994, we had regular tax net operating loss carryforwards of $1.7 billion and alternative minimum tax loss carryforwards of $900 million. Regular federal tax net operating loss carryforwards of $420 million expire in 1998, with the balance expiring in varying amounts from 1999 through 2009.

Statement No. 109 requires that we record a valuation allowance when it is "more likely than not that some portion or all of the deferred tax assets will not be realized." It further states, "forming a conclusion that a valuation allowance is not needed is difficult when there is negative evidence such as cumulative losses in recent years." The ultimate realization of this deferred tax asset depends on our ability to generate sufficient taxable income in the future. Bethlehem reported income before income taxes, restructuring charges and extraordinary gains in 1987 through 1990 and incurred higher costs in 1991 and 1992 relating to unusual repair costs at a coke plant that has subsequently been idled and start-up costs of certain modernized facilities. Bethlehem has undergone substantial restructuring and made substantial strategic capital expenditures during the last several years. As a result, Bethlehem has a significantly lower and more competitive cost structure and our income from operations before restructuring charges improved significantly in both 1994 and 1993 from the prior year. Also, we have significant tax planning opportunities to manage taxable income including selection of depreciation methods and timing of contributions to our pension trust.

While we believe that our total deferred tax asset will be fully realized by future operating results together with tax planning opportunities, our losses from operations before restructuring charges in 1991 and 1992 make it appropriate to record a valuation allowance. Accordingly, we have provided a valuation allowance at December 31, 1994 and 1993 equal to 50% of the total deferred tax asset related to our operating loss carryforward and our temporary differences exclusive of postretirement benefits other than pensions. We expect our annual financial statement expense for postretirement benefits other than pensions to exceed the annual amount deductible in our tax returns for several years. Furthermore, if we have a tax loss in any year in which our tax deduction exceeds our financial statement expense, the tax law currently provides for a 15-year carryforward of that loss against future taxable income. Under current law, we have a very long time to realize these future tax benefits. We believe, therefore, a valuation allowance is not necessary for the deferred tax asset related to our temporary difference for postretirement benefits other than pensions.

If we are unable to generate sufficient taxable income in the future through operating results or tax-planning opportunities, we will be required to increase our valuation allowance through a charge to expense (reducing our stockholders' equity). On the other hand, if we achieve sufficient profitability to use all of our deferred income tax asset, we will reduce the valuation allowance through a decrease to expense (increasing our stockholders' equity).

In addition to income taxes, we incurred costs for certain other taxes as follows:

(Dollars in millions)	 1994		 1993		 1992
Employment taxes	$ 90.1		$ 89.1		$ 88.7
Property taxes		  24.7		  27.5		  26.7
State and foreign taxes	   9.1		   9.0		  11.2
Federal excise tax 
on coal			   3.1		   3.3		   5.3
Total other taxes	$127.0		$128.9		$131.9

			December 31
(Dollars in millions)	 1994		 1993
5.69%-5.99% 
Galvanizing lines 
financing		$224.6		$262.0
Notes and loans:
10-3/8% 
Senior Notes, Due 2003	 105.0		 105.0
2%-12-3/4%, 
Due 1995-2009		  31.3		  34.8
Debentures:
6-7/8% Due 1999		  16.0		  18.8
9% Due 2000		  36.0		  39.9
8-3/8% Due 2001		  41.6		  41.6
8.45% Due 2005		  90.7		  90.7
Pollution control and industrial revenue bonds:
7-1/2%-8%, 
Due 2015-2024		 128.9		  78.1
Variable interest 
at 50%-70% 
of prime rate, Due 
1995-1996		   -		  27.0
Capital lease 
obligations		  84.8		 117.9
Unamortized debt 
discount		  (1.6)		  (2.0)
Total 			 757.3		 813.8
Amounts due within 
one year		 (88.9)		 (95.5)
Long-term		$668.4		$718.3

Maturities and sinking fund requirements at December 31, 1994 for the next five years were $89 million in 1995, $98 million in 1996, $56 million in 1997, $52 million in 1998 and $51 million in 1999.

The hot-dip galvanizing lines financing is collateralized by the coating lines at our Sparrows Point and Burns Harbor Divisions and will be repaid in equal semiannual installments through 2000.

The 10 3/8% Senior Notes are senior in right of payment to all existing and future subordinated indebtedness of Bethlehem. As unsecured senior obligations of Bethlehem, the Notes will effectively be subordinate to secured senior indebtedness of Bethlehem. These Notes contain covenants which impose certain limitations on Bethlehem's ability to incur or repay debt, to pay dividends and make other distributions on or redeem capital stock, or to sell, merge, transfer or encumber assets. See Note L, Stockholders' Equity.

Our revolving credit agreement, which expires on December 29, 1996, is non-reducing with total commitments of $500 million as of December 31, 1994. Borrowings under the revolver are subject to collateral coverage requirements and incur interest based on the prime rate, Federal Funds rate, certificate of deposit rates or LIBOR. Our accounts receivable and inventories are pledged as collateral for borrowings and letters of credit under the credit agreement and certain other obligations to participating banks. No borrowings were outstanding at December 31, 1994 and 1993. We pay five-eighths of 1% per annum commitment fee on the unused available credit.

Our revolving credit and hot-dip galvanizing lines financing agreements contain restrictive covenants which require Bethlehem to maintain a minimum adjusted tangible net worth. At December 31, 1994, our adjusted tangible net worth exceeded the more restrictive of these requirements by about $1.4 billion. At December 31, 1994 and 1993, the estimated fair value of our debt was less than the recorded amount by approximately $32 million and $7 million.

At December 31, 1994, outstanding interest rate swap agreements with notional amounts totaling $75 million effectively fix the interest rate on a like amount of our floating rate debt and caster leases at 8.39% to 8.70%. These agreements expire in 2000 and 2001. At December 31, 1994 and 1993, the estimated fair value of our interest rate swap agreements represents an unrecorded obligation of approximately $2 million and $31 million. The ultimate amounts paid or received under these agreements, however, depend on future interest rates. We based our estimates of fair value on market prices or current rates offered for debt and swaps with similar terms and maturities.

We lease certain manufacturing facilities and equipment under capital leases, the most significant of which covers the two continuous casters at our Sparrows Point and Burns Harbor Divisions. The casters lease requires quarterly rental payments of $9 million plus interest at 1-1/4% above LIBOR. The amounts included in property, plant and equipment for capital leases were $291 million (net of $247 million accumulated amortization) and $320 million (net of $222 million accumulated amortization) at December 31, 1994 and 1993.

Future minimum payments under noncancellable operating leases at December 31, 1994 were $23 million in 1995, $21 million in 1996, $14 million in 1997, $11 million in 1998, $8 million in 1999 and $30 million thereafter. Total rental expense under operating leases was $38, $41 and $50 million in 1994, 1993 and 1992.

G. Commitments and Contingent Liabilities
Based generally on our proportionate ownership in an iron ore associated enterprise, we are entitled to receive our share of certain ore produced and are committed to pay our share of their costs. We received 2.7 million net tons of such iron ore in each of the years 1994, 1993 and 1992 at a net cost of $82, $89 and $89 million.

At December 31, 1994, we had outstanding approximately $120 million of purchase orders for additions and improvements to our properties.

We, as well as other steel companies, are subject to various environmental laws and regulations imposed by federal, state and local governments. Because of the continuing evolution of the specific regulatory requirements and available technology to comply with the requirements, we cannot reasonably estimate the future capital expenditures and operating costs required to comply with these laws and regulations. Although it is possible that our future operating results in a particular quarterly or annual period could be materially affected by the future costs of environmental compliance, we do not believe the future costs of environmental compliance will have a material adverse effect on our consolidated financial position or on our competitive position with respect to other integrated domestic steelmakers subject to the same environmental requirements.

In the ordinary course of our business, we are involved in various pending or threatened legal actions. In our opinion, adequate reserves have been recorded for losses which are likely to result from these proceedings. If such reserves prove to be inadequate, however, we would incur a charge to earnings which could be material to the results of operations in a particular future quarterly or annual period. We believe that any ultimate liability arising from these actions will not have a material adverse effect on our consolidated financial position.

H. Postretirement Pension Benefits
We have noncontributory defined benefit pension plans which provide benefits for substantially all employees. Defined benefits are based on years of service and the five highest consecutive years of pensionable earnings during the last ten years prior to retirement or a minimum amount based on years of service. We fund annually the amount required under ERISA minimum funding standards plus additional amounts as appropriate.

The following sets forth the plans' actuarial assumptions used and funded status at year end together with amounts recognized in our consolidated balance sheets:

						December 31
(Dollars in millions)			   1994		   1993
Assumptions:
Discount rate			     	     9.0%	     7.5%
Average rate of compensation 
increase			     	     3.1%	     2.9%
Actuarial present value 
of benefit obligations:
Vested benefit obligation		$4,246.9	$4,816.4
Accumulated benefit obligation	 	 4,392.9	 4,979.4
Projected benefit obligation	 	 4,578.8	 5,208.6
Plan assets at fair value:
Fixed income securities		 	 1,758.6	 1,955.0
Equity securities		 	 1,371.4	 1,232.2
Cash and marketable securities	   	   145.8	   178.6
Total plan assets			$3,275.8	$3,365.8
Projected benefit obligation in excess
of plan assets			 	 1,303.0	 1,842.8
Unrecognized net loss		   	   (82.1)	  (289.7)
Remaining unrecognized net obligation 
resulting from adoption of 
Statement No. 87		  	  (255.2)	  (293.5)
Unrecognized prior service cost from
plan amendments				  (275.2)	  (307.1)
Adjustment required to recognize minimum
liability-Intangible asset		   426.6	   600.6
-Additional paid-in capital 
(pre-tax) (Note L)			     -		    60.5
Pension liability			$1,117.1	$1,613.6

 (Dollars in millions)		  1994		  1993		  1992
Assumptions:
Return on plan assets		    8.75%	    9.50%	    9.50%
Discount rate			    7.50%	    8.50%	    8.50%
Pension cost:
Service cost-benefits earned 
during the period		$  51.9		$  39.3		$  45.0
Interest on projected benefit
obligation			  375.7		  380.4		  394.2
Return on plan assets-actual	   60.3		 (308.8)	 (250.0)
-deferred			 (365.3)	    4.3		  (62.2)
Amortization of initial net
obligation			   36.7		   37.7		   37.8
Amortization of unrecognized
prior service cost from plan
amendments			   32.7		   19.8		   18.8
Total defined benefit plans	  192.0		  172.7		  183.6
PBGC premiums, administration 
fees, etc.			   11.1		   10.9		    5.1
Total cost			$ 203.1		$ 183.6		$ 188.7

					December 31
 (Dollars in millions)		   1994		   1993
Assumptions:
Discount rate			     9.0%	     7.5%
Trend rate-beginning		     9.0%	     9.0%
-ending (year 2000)		     4.6%	     4.6%
Accumulated postretirement
benefit obligation:
Retirees			$1,427.6	$1,506.7
Fully eligible active 
plan participants		    99.7	   126.8
Other active plan participants	   160.4	   236.1
Total				 1,687.7	 1,869.6
Plan assets at fair value:
Fixed income securities		   135.5	   158.5
Accumulated postretirement benefit
obligation in excess of 
plan assets			 1,552.2	 1,711.1
Unrecognized net gain (loss) 	    27.2	  (130.5)
Total obligation		 1,579.4	 1,580.6
Current portion			  (138.0)	  (132.3)
Long-term obligation		$1,441.4	$1,448.3

 (Dollars in millions)			 1994		 1993		  1992
Return on plan assets			   8.75%	 9.50%		   9.50%
Discount rate				   7.50%	 8.50%		   8.50%
Trend rate-beginning			   9.00%	 9.50%		   9.50%
-ending (2000)				   4.60%	 5.50%		   5.50%
Service cost				$ 11.1		$9.0		  $9.0
Interest on accumulated postretirement
benefit obligation			 138.8	       144.1		 139.0
Return on plan assets-actual		   4.7	       (17.9)		 (18.4)
-deferred				 (17.6)	 	 3.8		   4.5
Total cost				$137.0	      $139.0		$134.1

J. Stockholder Rights Plan

We have a Stockholder Rights Plan under which holders of Common Stock have rights to purchase a new series of Preference Stock. When exercisable, each right entitles the holder to purchase a hundredth of a share of Series A Junior Participating Preference Stock at an exercise price of $80 per unit. The rights will become exercisable only if a person or group acquires 20% or more of Common Stock or begins a tender offer or exchange offer which would result in that person or group beneficially owning 20% or more of Common Stock. Subsequently, upon the occurrence of certain events, holders of rights will be entitled to purchase Common Stock of Bethlehem or a third-party acquiror worth twice the right's exercise price. Until the rights become exercisable, we will be able to redeem them at one cent per right. The rights expire on October 18, 1998.

K. Stock Options
At December 31, 1994, we had options outstanding under our Stock Option Plans. The 1994 Stock Incentive Plan was approved by our stockholders on April 26, 1994 and replaces the 1988 Stock Incentive Plan. New options can be granted only under the 1994 Plan, which reserved 4,000,000 shares of Common Stock for such use. At December 31, 1994, options on 3,211,200 shares of Common Stock were available for granting under the 1994 Plan. The option price is the fair market value of our Common Stock on the date the option is granted. Options issued under the 1994 Plan become exercisable either two or four years after the date granted and expire ten years from the date granted. Exercisable options may be surrendered for the difference between the option price and the fair market value of the Common Stock on the date of surrender. Depending on the circumstances, option holders receive either Common Stock, cash, or a combination of Common Stock and cash.

Changes in options outstanding during 1994 and 1993 under the Plans were as follows:

Option 					Number of	Price
Options	 or Range
Balance December 31, 1992		2,911,319	7-3/4 - 27-1/8
Granted	532,600	19
Terminated or cancelled			 (348,102)	8 - 27-1/8
Surrendered or exercised		 (215,902)	7-3/4 - 17-5/8
Balance December 31, 1993		2,879,915	8 - 26-1/8
Granted	561,900	20-3/8
Terminated or cancelled			 (256,264)	14-1/8 - 26-1/8
Surrendered or exercised		 (685,303)	8 - 21-3/4
Balance December 31, 1994		2,500,248	8 - 21-3/4
1,689,298 options outstanding were exercisable at December 31, 1994.

Preferred and Preference Stock issued and outstanding:
December 31

(Shares in thousands)				1994	1993
Preferred Stock - Authorized 20,000 shares
$5.00 Cumulative Convertible Preferred Stock	2,500	2,500
$2.50 Cumulative Convertible Preferred Stock	4,000	4,000
$3.50 Cumulative Convertible Preferred Stock	5,123	5,123
Preference Stock - Authorized 20,000 shares
Series "A" 5% Cumulative Convertible 
Preference Stock				1,966	2,171
Series "B" 5% Cumulative Convertible 
Preference Stock				  653	  640

During 1993, we issued 5.1 million shares of $3.50 Cumulative Convertible Preferred Stock for $248 million. Each share is convertible into 2.39 shares of Common Stock, subject to certain events.

Each share of the $5.00 Cumulative Convertible Preferred Stock and the $2.50 Cumulative Convertible Preferred Stock issued in 1983 is convertible into 1.77 and .84 shares of Common Stock, respectively, subject to certain events.

In accordance with our labor agreements, we issue Preference Stock to a trustee under the Employee Investment Program. Series "�A�" and "B" Series of Preference Stock have a cumulative dividend of 5% per annum payable at our option in cash, Common Stock or additional shares of Preference Stock. Each share of Preference Stock is entitled to vote with Common Stock on all matters and is convertible into one share of Common Stock.

Under the covenants of our 10-3/8% Senior Notes, we can pay future dividends on our Common Stock, among certain other restrictions, only if such cumulative dividends do not exceed the aggregate net cash proceeds from the sale of capital stock plus 50% of a consolidated net income and minus 100% of a consolidated net loss since the second quarter of 1993, excluding certain restructuring charges. The amount available at December 31, 1994 under this covenant was $435 million.

M. Quarterly Financial Data (Unaudited)

(Dollars in millions, except per share data)  

                                        1994                       
                         1Q         2Q         3Q          4Q 
Net sales             $1,117.4   $1,230.5   $1,233.2    $1,224.5
Cost of sales          1,005.2    1,087.9    1,120.9     1,073.3
Estimated               
restructuring                                            
losses                    -          -          -           -       
Net income (loss)         12.9       26.0       10.3        31.3 
Net income (loss)
per Common
Share                 $     .02  $     .14  $   -       $     .19
                                        1993   
                          1Q         2Q         3Q          4Q
Net sales             $1,020.4   $1,117.4   $1,055.3    $1,130.3
Cost of sales            946.4    1,010.6      924.4       952.8 
Estimated
restructuring
losses                    -          -          -          350.0  
Net income (loss)        (40.8)     (13.6)      30.7      (242.6)
Net income (loss
per Common
Share                 $    (.53)  $   (.27)  $    .22    $  (2.78) 

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