Bindley Western Industries.

Bindley Western Industries of Indianapolis is the nation's fifth-largest drug wholesaler. It distributes to customers in 39 states from 11 regional warehouses. It ships a larger percentage of sales to drug chains than does its main competitors--in 1991, two large customers accounted for 41 percent

The company's five-year sales growth exceeds 27 percent. Revenues passed the $2 billion mark in 1990, and sales could surpass $3 billion next year. Some 80 percent of the company's sales are to drug chains such as Revco, Rite Aid and Peyton, a subsidiary of Kroger Co. Continued consolidation in the industry is expected, with many smaller local and regional drug wholesalers likely to be acquired by industry leaders, including Bindley. Case in point is Bindley's recent acquisition of J.E. Goold, a Maine company with sales of about $180 million.

In 1991, Bindley Western opened or expanded distribution facilities across the United States. A new computer system is now up and running, providing chain customers with on-line ordering capability and just-in-time inventory management. The investments have improved margins which are razor-thin--about 0.74 percent pretax. The purchasing area hopes to further improve margins by anticipating drug price increases and buying in advance.

Bindley Western's financial position is strong and improving. The company has called for redemption of some $53.2 million in 8.625 percent convertible debentures due 2010. The bonds are convertible into common stock. The conversion will increase outstanding shares by 3.67 million, and will leave Bindley with no long-term debt and a better debt-to-equity ratio than any of its major competitors.

FINANCIAL DATA
12 MO.                 1990                 - LAST 12 MOS. -
RANGE                  E.P.S.             E.P.S.         P/E
$20.75-$13.50          $1.22              $1.33         12.5
3-YEAR                                                  ($MM)
AVG. P/E             DIVIDENDS            YIELD       MKT. CAP
16.3                   $0.06              0.36%         $117.5
ANNUAL TRENDS
FISCAL                                 - PER SHARE DATA -
YEAR           SALES (MM)         EARNINGS         DIVIDENDS
1986             $711.0            $0.77            $0.00
1987            1,055.2             0.30             0.00
1988            1,275.0             0.88             0.00
1989            1,561.1             0.78             0.00
1990            2,047.1             1.22             0.03
1991            2,397.0             1.33             0.06
LAST 12 MONTHS PRICE CHANGE:                         4.3%
AVG. DAILY VOLUME:                          58,315 SHARES

This information has been obtained from sources we believe to be reliable, but it is not guaranteed and does not purport to be a statement of all material facts. This report is for informational purposes only and is not a solicitation of orders to buy or sell securities.

Bindley's stock price has been depressed by the conversion of the convertible debentures, which can be seen as a buying opportunity.