##### Table of Contents









UNITED STATES

SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549




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FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13

OF THE SECURITIES EXCHANGE ACT OF 1934


For the Fiscal Year Ended December 31, 1999

Commission File Number 1-11793

THE DIAL CORPORATION

(Exact Name of Registrant as Specified in its
Charter)


|                                                                                          |  |                                                 
|----------------------------------------------------------------------------------------- |  | ------------------------------------------------
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Delaware
	(State or Other Jurisdiction of Incorporation or Organization)                  |  | 51-0374887
	(I.R.S. Employer Identification No.)
|                                                                                         
|15501 North Dial Boulevard
	Scottsdale, Arizona
	(Address of Principal Executive Offices) |  | 85260-1619
	(Zip Code)                          

Registrants Telephone Number, Including Area Code:
(480) 754-3425

Securities Registered Pursuant to Section 12(b) of the
Act:

|                                                              |  |                                                 
|------------------------------------------------------------- |  | ------------------------------------------------
|                                                              |  | Name of Each Exchange                           
|Title of Each Class                                           |  | On Which Registered                             
|                                                              |  |                                                 
|Common Stock, $.01 par value
	Preferred Share Purchase Rights |  | New York Stock Exchange
	New York Stock Exchange

Securities Registered Pursuant to Section 12(g) of the
Act: None

Indicate by check mark whether the registrant (1) has filed
all Exchange Act reports required to be filed by Section 13
or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months, and (2) has been subject to such
filing requirements for the past
90 days.     Yes 
[X]     No  [   ]

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 the
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.     [   ]

As of March 22, 2000, 94,774,757 shares of Dials
common stock were outstanding and the aggregate market value of
the common stock (based on its closing price per share on such
date) held by nonaffiliates was approximately $1.3 billion.

Documents Incorporated by Reference

Portions of Dials proxy statement relating to the 2000
annual meeting of stockholders to be held on June 1, 2000,
have been incorporated by reference into Part III,
Items 10, 11 and 12 of this Form 10-K.



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TABLE OF CONTENTS



|        |                                                                                               |  |  |  |  |  |  | 
|------- | --------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I 
|        | Item 1. Business                                                                             
|        | Item 2. Properties                                                                           
|        | Item 3. Legal Proceedings                                                                    
|        | Item 4. Submission of Matters to a Vote of Security Holders                                  
|        | Item 5. Market for Registrants Common Equity and Related Stockholder Matters                
|        | Item 6. Selected Financial and Other Data                                                    
|        | Item 7. Managements Discussion and Analysis of Results of Operations and Financial Condition
|        | Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 
|        | Item 10. Directors and Executive Officers of the Registrant                                  
|        | Item 11. Executive Compensation                                                              
|        | Item 12. Security Ownership of Certain Beneficial Owners and Management                      
|        | Item 13. Certain Relationships and Related Transactions                                      
|PART IV
|        | Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K                     



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TABLE OF CONTENTS

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|PART I  
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|Item  1  |  | Business                                                                                 |  |      | 1  | 
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|Item  2  |  | Properties                                                                               |  |      | 7  | 
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|Item  3  |  | Legal Proceedings                                                                        |  |      | 8  | 
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|Item  4  |  | Submission of Matters to a Vote of Security Holders                                      |  |      | 9  | 
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|PART II 
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|Item  5  |  | Market for Registrants Common Equity and Related
	Stockholder Matters                   |  |      | 9  | 
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|Item  6  |  | Selected Financial and Other Data                                                        |  |      | 9  | 
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|Item  7  |  | Managements Discussion and Analysis of Results of
	Operations and Financial   Condition |  |      | 11 | 
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|Item  7A |  | Quantitative and Qualitative Disclosure About Market Risk                                |  |      | 17 | 
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|Item  8  |  | Financial Statements and Supplementary Data                                              |  |      | 19 | 
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|Item  9  |  | Changes in and Disagreements with Accountants on Accounting and
	Financial   Disclosures |  |      | 42 | 
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|PART III
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|Item  10 |  | Directors and Executive Officers of the Registrant                                       |  |      | 42 | 
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|Item  11 |  | Executive Compensation                                                                   |  |      | 44 | 
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|Item  12 |  | Security Ownership of Certain Beneficial Owners and Management                           |  |      | 44 | 
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|Item  13 |  | Certain Relationships and Related Transactions                                           |  |      | 44 | 
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|PART IV 
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|Item  14 |  | Exhibits, Financial Statement Schedules and Reports on Form 
	 8-K                       |  |      | 45 | 



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PART I


Unless otherwise indicated the industry data contained herein
are derived from publicly available industry trade journals and
reports, including, with respect to market rank and market share,
 reports published by Information Resources, Inc., and other
publicly available sources which we have not independently
verified but which we believe to be reliable. Unless otherwise
noted, all market share data as of any particular date are as of
the 52 weeks then ended and are based upon sales in the U.S.
 market. Soap products are measured by ounces sold. Detergent
products are measured by standard cases sold. Air fresheners and
canned meats are measured by units sold.

This Annual Report on Form 10-K contains forward-looking
statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. When used in this
Form 10-K, the words anticipates,
intends, plans, believes,
estimates and similar expressions are intended to
identify forward-looking statements. These statements are based
upon managements beliefs, as well as on assumptions made by
 and information currently available to management, and involve
various risks and uncertainties, which are beyond our control.
Our actual results could differ materially from those expressed
in any forward-looking statements made by, or on behalf of, us.
Factors that could cause actual results to differ include those
factors identified in Item 7. Managements
Discussion and Analysis of Results of Operations and Financial
Condition  Factors That May Affect Future Results and
Financial Condition in this Form 10-K.






Item 1.  Business


General

We manufacture and sell consumer products. We market our products
 primarily under such well-known household brand names as Dial® soaps, Purex® detergents,
Renuzit® air fresheners and Armour® canned meats. We also market specialty personal care
products under the brand names Freeman®, Sarah Michaels® and Natures
Accents®. We believe that our brand names have
contributed to our products achieving leading market positions.

For organizational, marketing and financial reporting purposes,
we have organized our business into three segments:



| |   |                              
| | - | -----------------------------
| |  | Domestic Branded,            
|
| |  | International and            
|
| |  | Commercial Markets and Other.

Domestic Branded

Our Domestic Branded business segment is comprised of five
franchises:



| |   |                                                                       
| | - | ----------------------------------------------------------------------
| |  | Dial,                                                                 
|
| |  | Purex,                                                                
|
| |  | Renuzit,                                                              
|
| |  | Armourand                                                             
|
| |  | Specialty Personal Care (Freeman, Sarah Michaelsand Natures Accents).

Within our Domestic Branded business segment, we have chosen to
focus our marketing and product development efforts on the Dial, Purex, Renuzit, Armour, Freeman, Sarah Michaelsand Natures Accentsbrands. Our Domestic Branded business
segment accounted for 86%, 85% and 84% of our net sales in 1999,
1998 and 1997, respectively. A discussion of our Domestic Branded
 franchises follows.

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Dial

Our Dialfranchise includes Dialand Liquid
Dial® soaps and body washes, and Tone
® and Pure & Natural® soaps.
Net sales for the Dialfranchise for 1999, 1998 and 1997
were 27%, 30% and 30%, respectively, of the Domestic Branded
business segment. At December 31, 1999, our Dialand
other soap products had a 16.7% market share, measured in ounces
sold, in the $2.1 billion soap category. Based on ounces sold,
Dialwas Americas leading bar soap and antibacterial
 bar soap and the second leading liquid soap and antibacterial
liquid soap as of December 31, 1999.

Purex

Our Purexfranchise includes Purexdetergents,
bleach and fabric softeners, and Trend® and
Dutch® detergents, Borateem® bleach, Vano® and Sta-Flo® starches, Boraxo® soap and 20 Mule
Team® borax, Fels Naptha® laundry
 soap and La France® brightener. Net sales for
 the Purex franchise for 1999, 1998 and 1997 were 32%, 32%
 and 34%, respectively, of the Domestic Branded business segment.
 As of December 31, 1999, Purexheld the number two
market share position with an 8.7% share, measured by standard
cases sold, in the $4.7 billion domestic laundry detergent
market.

In April 1999, we formed Dial/ Henkel LLC, a joint venture
with Henkel KGaA of Düsseldorf, Germany. Dial and Henkel
each own 50% of this joint venture. This joint venture was formed
 to develop and market a range of enhanced laundry products in
North America. In July 1999, the joint venture acquired the
Custom Cleaner, Inc.® home dry cleaning
business. In December 1999, the joint venture launched Purex Advanced®.

Renuzit

Our Renuzitfranchise includes a variety of air
fresheners, candles and accessories that all bear the Renuzitname. Net sales for the Renuzit franchise for each of
1999, 1998 and 1997 were 14% of the Domestic Branded business
segment. As of December 31, 1999, Renuzitwas the
second leading brand in the $976 million domestic air freshener
market.

Armour

Our Armourfranchise includes Armourand Armour Star® canned meats, chili, hashes and meat
spreads and Cream® corn starch. Our Armourbranded products are concentrated in the profitable canned
meat market segment. Net sales for the Armourfranchise
for 1999, 1998 and 1997 were 17%, 18% and 21%, respectively, of
the Domestic Branded business segment. As December 31, 1999,
 Armourwas the number two national brand of canned meats
and was the market leader in the growing Vienna sausage segment.

Specialty Personal Care

Our Specialty Personal Care franchise includes a variety of skin,
 hair, bath, body and foot care products sold under the Freeman, Sarah Michaelsand Natures Accents
brand names. We acquired The Freeman Cosmetic Corporation
(Freeman) in July 1998. Freemanis a
manufacturer and marketer of skin, hair, bath, body and foot care
 products all sold under the Freemanbrand name. We
acquired Sarah Michaels, Inc. (Sarah Michaels) in
September 1998. Sarah Michaelsis a leading marketer
of premium specialty bath and body products, including body
washes, body mists, luxury soaps, hand and body lotions, loofahs,
 sponges and brushes, which are distributed under the Sarah
Michaelsbrand name. These two acquisitions were combined
with our Natures Accentsline of translucent soaps
and specialty care products and our subsidiary, ISC
International, Ltd., a manufacturer of translucent soaps, to
create the Specialty Personal Care franchise. Net sales for the
Specialty Personal Care franchise for 1999, 1998 and 1997 were
10%, 6% and 1%, respectively, of the Domestic Branded business
segment.

International

We distribute products in more than 40 countries. We have focused
 our international efforts in Argentina, Canada, Mexico, Puerto
Rico and the Caribbean. During 1999, 1998 and 1997 approximately
88%, 89% and

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In the third quarter of 1997, we acquired Nuevo Federal S.A., a
manufacturer and marketer of personal care and household products
 in Argentina. In the fourth quarter of 1997, we acquired three
personal care soap brands and two laundry bar brands from The
Procter & Gamble Companys Argentinean subsidiary. With
these acquisitions, we entered what we believe is one of Latin
Americas largest consumer markets by establishing a
position in Mercosur, a regional trading bloc with more than 230
million consumers in Argentina and neighboring countries,
including Brazil, Paraguay, Uruguay and Chile.

In the Argentinean consumer products market, as of
December 31, 1999, Nuevo Federal held the number three
position in laundry detergents with the Zorro®
, Enzimax® and Limzul®
brands, the number two position in laundry bars with the Gran Federal® and Gran Llauro®
brands, the number three position in dish detergents with the Cristal® and Zorrobrands and the number
four position in bar soaps with the Limol® and
 Campos Verdes® brands.

In Canada, Purexliquid is the number one liquid laundry
detergent overall and the number one liquid laundry detergent in
mass merchandisers, Canadas fastest growing retail channel.
 Liquid Dialis the number three antibacterial liquid soap
 in Canada. In Mexico, Liquid Dialis the number one
liquid soap with 70% of this category. Breck®
haircare products enjoy strong brand recognition in Mexico, with
Breckhairspray having 7% of the hairspray category. In
Puerto Rico, Purexliquid holds the number three market
position in the liquid laundry detergent category with 12% of the
 category.

Commercial Markets and Other

Our Commercial Markets business sells branded and nonbranded
products, through the commercial channel to hotels, hospitals,
schools and other institutional customers. In addition, this
business segment includes sales of chemicals principally glycerin
 and fatty acids, that are by-products of the soap making and
detergent making process. Dials Commercial Markets and
Other business segment accounted for 4%, 4% and 6% of our net
sales in 1999, 1998 and 1997, respectively.

Discontinued and Divested Brands

By February 1998, we had discontinued or divested product
lines that were not within our core businesses. Under this
strategy, in the third quarter of 1997, we sold some of our
household cleaning brands to Church & Dwight for
approximately $30 million. The sale included the following brands
 and related inventories: Brillo® soap pads
and related products, Parsons® ammonia,
Bo Peep® ammonia, Sno Bol®
toilet bowl cleaner, Cameo® metal polish and
Rain Drops® water softener. Our London, Ohio,
plant, where Brillo was manufactured, also was part of the
 sale. In addition, in the third quarter of 1997, we sold our Bruce® floor care product trademark and our Magic® sizing starch brand and related
inventories to other third parties for $4.5 million. In
February 1998, we sold the Purex Toss N
Soft® brand to Church & Dwight for $5.3 million.
 Sales of these products in 1998 were insignificant. In 1997,
these brands as well as discontinued brands generated net sales
of approximately $53 million, or approximately 4% of our total
net sales.

Customers

Our products are sold throughout the United States primarily
through supermarkets, mass merchandisers, drug stores, membership
 club stores and other outlets. Our top 10 customers accounted
for approximately 42%, 40% and 35% of net sales in 1999, 1998 and
 1997, respectively. Wal-Mart, including its affiliate,
Sams Club, was our largest customer, accounting for
approximately 18%, 17% and 17% of our net sales in 1999, 1998 and
 1997, respectively. No other customer accounted for more than
10% of net sales in 1999, 1998 or 1997. Generally, our payment
terms to customers range from 30 to 60 days. For Specialty
Personal Care, we have special holiday terms which extend to 90
days.

Our products are also sold internationally through the same
outlets, principally in Argentina, Canada, Mexico, Puerto Rico
and the Caribbean.

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Sales

Our customers are served by a national sales organization of
approximately 200 employees. The sales organization is divided
into four regions for grocery sales plus specialized sales
operations that sell to large mass merchandisers, membership club
 stores, chain drug stores and vending and military customers. In
 addition, some customers and regions, representing approximately
 16.2% of our 1999 net sales, are served by a national broker
sales organization.

Promotion and Advertising

A significant portion of our revenues are expended for trade
discounts and the promotion and advertising of our products. We
believe that these expenditures are necessary to maintain and
increase market shares in an industry highly dependent on product
 image and quality, trade support and consumer trends. We
incurred discounts and expenses for these purposes of $444.7
million, $373.3 million and $311.4 million in 1999, 1998 and
1997, respectively. This represents 26%, 24% and 23%, of net
sales in those years.

Distribution

We ship product from nine of our warehouses located at or near
our domestic manufacturing and assembly facilities and four
domestic regional distribution centers. The regional warehouses
are operated by third parties, except for one warehouse that we
own and operate. We use outside carriers to transport our
products.

We have a just-in-time inventory management program of
continuous, automatic replenishment of certain of our trade
customers inventories. The primary objective of this
program is to improve service to our customers and reduce costs
by shortening the order-to-delivery pipeline. This occurs by
anticipating customer needs based on historical sales, shipping
the product just before those needs arise and eliminating
redundancy, errors and interruption throughout the replenishment
process. Sales under this program accounted for approximately 15%
 of our net sales in each of 1999, 1998 and 1997.

Suppliers

We rely on a number of third parties for research and
development, manufacturing and packaging. Many of our
arrangements with respect to new products contain limited mutual
exclusivity provisions. This is designed to permit us and the
supplier to profit from the product enhancement or innovation
before we use an alternative supplier or the supplier sells to
one of our competitors. Most of our outsourcing arrangements can
be terminated without material penalties on an average of three
months notice.

Raw Materials

We believe that ample sources of raw materials are available with
 respect to all of our major products. Paper, fats and oils,
detergent chemicals and meat have the most significant impact on
our costs. Generally, we purchase these raw materials from a
variety of suppliers in the United States. While we believe that
in certain circumstances we may be able to respond to price
increases for certain raw materials by increasing sales prices,
rapid increases in the prices of certain raw materials could
materially impact our profit margins and financial results. For
example, tallow (a key ingredient in Dial bar soaps) has
experienced price fluctuations within the range of $0.10 and
$0.28 per pound from January 1, 1995, to December 31,
1999. Recently, the price of tallow has been trading at the lower
 end of this historical range. If prices were to increase, we may
 not be able to increase the prices of our Dial bar soaps to
offset these increases as readily as many competitors, which tend
 to use less tallow in their products. In addition, we depend on
a single supplier for Triclosan, the antibacterial agent that is
the active ingredient used in Liquid Dial products. Although we
have an adequate supply of Triclosan for our current and
foreseeable needs, a significant disruption in this supply could
have a material adverse impact on our financial results.

We attempt to reduce our risk by entering into contracts to
provide up to six- to 12-month supplies of tallow, Triclosan and
packaging materials. During 1999, we began using financial
derivatives to mitigate price

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Competition

We compete primarily on the basis of brand equity, brand
advertising, customer service, product performance and product
quality at competitive retail price points. We compete with
numerous, well-established local, regional, national and
international companies. Some of these companies have greater
financial resources than we do and may be willing to commit
significant resources to protecting their own market shares or to
 capturing market share from us. Our principal competitors are as
 follows:

|              |  |                                                          
|------------- |  | ---------------------------------------------------------
|             
|Soap category
|             
|             |  | The Procter & Gamble Company (P&G)                     
|             |  | Lever Brothers Co., a division of Unilever PLC
	(Lever)
|             |  | Colgate-Palmolive Company (Colgate)                    

|                            |  |                         
|--------------------------- |  | ------------------------
|                           
|Household and air freshener
|                           
|                           |  | S.C. Johnson & Son, Inc.
|                           |  | Clorox Co.              
|                           |  | P&G                     
|                           |  | Colgate                 
|                           |  | Reckitt & Colman Inc.   

|             |  |                                   
|------------ |  | ----------------------------------
|            
|Canned Meats
|            
|            |  | Hormel Foods Corp.                
|            |  | International Home Foods (Libbys)

|                   |  |                          
|------------------ |  | -------------------------
|                  
|Detergent category
|                  
|                  |  | P&G                      
|                  |  | Lever                    
|                  |  | Colgate                  
|                  |  | Church & Dwight Co., Inc.
|                  |  | USA Detergents, Inc.     

|                        |  |                          
|----------------------- |  | -------------------------
|                       
|Specialty Personal Care
|                       
|                       |  | Calgon and Healing Garden
|                       |  | Johnson & Johnson, Inc.  
|                       |  | Yardley of London        
|                       |  | Del Laboratories, Inc.   
|                       |  | Alberto Culver           

Research and Development

We conduct research and development at our facility in
Scottsdale, Arizona. Our internal research and development
efforts are directed at improving existing products, developing
new products, and providing technical assistance and support to
our manufacturing activities. We rely on outside sources for
general research and development activities. Our internal and
external research and development expenditures were approximately
 $11.7 million, $10.1 million and $10.1 million in 1999, 1998 and
 1997, respectively.

Marketing Research

We rely on industry data, syndicated market share data, various
attitude and usage studies prepared by independent marketing
firms. We also obtain direct sales information from our largest
customers to identify consumer needs and anticipate shifts in
consumer preferences. This allows us to develop line extensions
and new products to meet changing demands.

Patents and Trademarks

Our trademarks include Dial, Purex, Renuzit, Armour, Armour
Star, Freeman, Sarah Michaels, Tone, Natures Accents, Pure
& Natural, Breck, Trend, Treet, 20 Mule Teamand Boraxoand related trade names. We license the Armour
and Armour Startrademarks from ConAgra, Inc. which also
sells non canned food products under the Armourtrademark.
 We license the 20 Mule Team trademark from U.S. Borax,
Inc.

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United States trademark registrations are for a term of
10 years, renewable every 10 years so long as the
trademarks are used in the regular course of trade. We maintain a
 portfolio of trademarks representing substantial goodwill in the
 businesses using these trademarks. We also have a significant
number of registered foreign trademarks and pending foreign
trademark applications.

United States patents are currently granted for a term of
20 years from the date a patent application is filed. We own
 a number of patents that provide competitive advantages in the
marketplace.

Government Regulation

Substantially all of our operations are, or may become, subject
to various federal laws and agency regulations. These include the
 Food, Drug, and Cosmetic Act, which is administered by the Food
and Drug Administration (the FDA). The FDA regulates
the manufacturing, labeling, and sale of our over-the-counter
drug and cosmetic products. The Insecticide, Fungicide, and
Rodenticide Act and the Toxic Substances Control Act are
administered by the Environmental Protection Agency and regulate
our disinfectant products and certain of the substances used in
the manufacturing of our products. The Meat Inspection Act is
administered by the Department of Agriculture and regulates our
meat products. The Hazardous Substances Act is administered by
the Consumer Product Safety Commission and regulates the labeling
 of the Companys household products. The Fair Packaging and
 Labeling Act is administered by the Federal Trade Commission
(the FTC) and regulates the packaging and labeling of
 all of our products. Our products also are subject to regulation
 by various state laws and various state regulatory agencies. In
addition, we are subject to similar laws and regulations imposed
by foreign jurisdictions.

Since the 1970s, the Food and Drug Administration has
regulated antibacterial soaps and hand washes under a proposed
regulation. Although the proposed regulation has not been
finalized, the FDA ultimately could set standards that result in
limiting or even precluding soap manufacturers from using some
current antibacterial ingredients or making antibacterial claims
for some product forms, such as bar soap. Dial, which uses the
antibacterial ingredient Triclosan in Liquid Dial and
Triclocarban in Dial bar soap, emphasizes the antibacterial
properties of its soap products in its marketing campaigns and
product labeling. Any final FDA regulation that limits or
precludes this type of advertising could require Dial to develop
new marketing campaigns, develop new products or utilize
different antibacterial ingredients in its products, all of which
 could materially adversely affect our business.

Environmental Matters

We are subject to a variety of environmental and health and
safety laws in each jurisdiction in which we operate. These laws
and regulations pertain to our present and past operations.
Although we currently do not anticipate that the costs to comply
with environmental laws and regulations will have a material
adverse effect on our financial results or condition, the
emergence of unforeseen claims or liabilities or the imposition
of increasingly stringent laws, regulations and enforcement
policies could result in material, unreserved costs in the
future. Since 1980, we have received notices or requests for
information with respect to Superfund sites under the
 federal Comprehensive Environmental Response, Compensation and
Liability Act, five of which are currently active. As of
December 31, 1999, we have accrued in our financial
statements approximately $2.3 million in reserves for expenses
related to Superfund sites and the clean-up of closed plant
sites. We believe our reserves are adequate, but these costs are
difficult to predict with certainty.

We do not currently anticipate that we will incur significant
capital expenditures in connection with matters relating to
environmental control or compliance in 2000. We do not anticipate
 that the costs to comply with environmental laws and regulations
 or the costs related to Superfund sites and the clean-up of
closed plant sites will have a material adverse effect on our
financial results or condition. However, there can be no
assurance that other developments, such as the emergence of
unforeseen claims or liabilities or the imposition of
increasingly stringent laws, regulations and enforcement policies
 will not result in material costs in the future.

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Federal, state, local and foreign environmental compliance may
from time to time require changes in product formulation or
packaging. These changes have not had, and are not expected to
have, a material adverse effect on our financial results or
condition.

Employees

We employed approximately 3,750 individuals, of whom
approximately 1,150 were covered by collective bargaining
agreements, as of December 31, 1999.

Four of our seven plants in the United States are unionized. Our
contract with the Oil, Chemical and Atomic Workers Union
(covering approximately 85 employees at our Bristol,
Pennsylvania, Plant) is scheduled for renegotiation in
May 2000. In 1999, we successfully renegotiated our contract
 with the United Food and Commercial Workers Union (covering
approximately 300 employees at our Aurora, Illinois Plant), which
 now expires in August 2002. In addition, we successfully
renegotiated our contract with the United Food and Commercial
Workers Union (covering approximately 420 employees at our Ft.
Madison, Iowa Plant), which now expires September 2003. In
1998, we successfully renegotiated our contract with the
International Brotherhood of Teamsters (covering approximately
335 employees at the Companys St. Louis, Missouri and
Madison County, Illinois distribution center), which now expires
in 2001. Although we believe that our relations with our
employees are satisfactory, there can be no assurance that we
will not face labor disputes in the future or that such disputes
will not be material to us.




Item 2.  Properties

Our corporate headquarters is located in a leased
130,000-square-foot, single-tenant building in Scottsdale,
Arizona, that is adjacent to our owned technical and
administrative building comprising 200,000 square feet. Our
principal facilities include the following.

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|                         |                             |          |  |         |           |  |                                                            | 
|------------------------ | --------------------------- | -------- |  | ------- | --------- |  | ---------------------------------------------------------- | 
|Location                 |                             | Sq. Feet |  | Purpose
|                         |                             |          |  |        
|Manufacturing Facilities |                             |          |  |         |           | 
|                        
|                        
|                        
|                        
|                         | Aurora, Illinois            |          |  | 451,000 |           |  | Bar soaps                                                 
|                        
|                        
|                        
|                        
|                         | Fort Madison, Iowa          |          |  | 447,000 |           |  | Canned meats and corn starch                              
|                        
|                        
|                        
|                        
|                         | St Louis, Missouri          |          |  | 272,400 |           |  | Dry and liquid laundry detergents, fabric softeners       
|                        
|                        
|                        
|                        
|                         | Bristol, Pennsylvania       |          |  | 261,800 |           |  | Dry detergents                                            
|                        
|                        
|                        
|                        
|                         | West Hazleton, Pennsylvania |          |  | 214,470 |           |  | Liquid detergents, fabric softeners and liquid soaps      
|                        
|                        
|                        
|                        
|                         | Los Angeles, California     |          |  | 47,400  |           |  | Powdered soap, fabric softeners and liquid detergents     
|                        
|                        
|                        
|                        
|                         | Compton, California         |          |  | 146,400 |           |  | Liquid soaps, bodywashes and shampoos                     
|                        
|                        
|                        
|                        
|                         | Guatemala City, Guatemala   |          |  | 100,000 |           |  | Translucent and transparent bar soaps                     
|                        
|                        
|                        
|                        
|                         | Mexico City, Mexico         |          |  | 83,750  |           |  | Shampoos, liquid soaps and hair care aerosols             
|                        
|                        
|                        
|                        
|                         | Buenos Aires, Argentina     |          |  | 150,000 |           |  | Bar soaps and dry detergents                              
|                        
|                        
|                        
|                        
|                         | Buenos Aires, Argentina     |          |  | 15,000  |           |  | Sulfonic acid                                             
|                        
|                        
|                        
|                        
|                         | San Juan, Argentina         |          |  | 70,000  |           |  | Dry detergents and bar soaps                              
|                        
|                        
|                        
|                        
|                         | San Juan, Argentina         |          |  | 33,000  |           |  | Liquid detergents, cleaners, air fresheners and deodorants
|                         |                             |          |  |         |           | 
|                         |                             | Subtotal |  |         | 2,292,220 |  |                                                            | 
|                        
|                        
|                        
|                        
|Distribution Centers     |                             |          |  |         |           | 
|                        
|                        
|                        
|                        
|                         | Atlanta, Georgia            |          |  | 253,700 |           |  | Warehousing and distribution of finished goods            
|                        
|                        
|                        
|                        
|                         | Allentown, Pennsylvania     |          |  | 608,000 |           |  | Warehousing and distribution of finished goods            
|                        
|                        
|                        
|                        
|                         | Corona, California          |          |  | 237,400 |           |  | Warehousing and distribution of finished goods            
|                        
|                        
|                        
|                        
|                         | Granite City, Illinois      |          |  | 812,000 |           |  | Warehousing and distribution of finished goods            
|                         |                             |          |  |         |           | 
|                         |                             | Subtotal |  |         | 1,911,100 |  |                                                            | 
|                        
|                        
|                        
|                        
|Warehouse Facilities     |                             |          |  |         |           | 
|                        
|                        
|                        
|                        
|                         | Dedham, Massachusetts       |          |  | 234,000 |           |  | Warehousing and gift set assembly                         
|                        
|                        
|                        
|                        
|                         | Stoughton, Massachusetts    |          |  | 75,000  |           |  | Warehousing                                               
|                        
|                        
|                        
|                        
|                         | Holbrook, Massachusetts     |          |  | 72,000  |           |  | Warehousing                                               
|                         |                             |          |  |         |           | 
|                         |                             | Subtotal |  |         | 381,000   |  |                                                            | 
|                         |                             |          |  |         |           | 
|                         |                             | Total    |  |         | 4,584,320 |  |                                                            | 
|                         |                             |          |  |         |           | 

We believe that our facilities in the aggregate are adequate and
suitable for their purposes and that manufacturing capacity is
sufficient for current needs. We continue to seek ways to cut
costs and may close plants as warranted.




Item 3.  Legal Proceedings

On May 21, 1999, we were served with a complaint filed by
the U.S. Equal Employment Opportunity Commission (the
EEOC) in the U.S. District Court for the Northern
District of Illinois, Eastern Division. This action is entitled
Equal Employment Opportunity Commission v. The Dial Corporation,
Civil Action No. 99 C 3356. The EEOC alleges that Dial has
engaged in a pattern and practice of discrimination against a
class of female employees by subjecting them to sexual or
sex-based harassment and failing to take prompt remedial action
after these employees complained about this alleged harassment.
The EEOC is seeking to enjoin Dial from this alleged harassment,
to require us to train our managerial employees regarding the
requirements of Title VII of the Civil Rights Act of 1964 and to
recover unspecified compensatory and punitive damages. We have
denied the EEOCs allegations. This lawsuit is in the
discovery stage and, as a result, assurances cannot be given
regarding the ultimate outcome of this matter.

As is the case with many companies, we also face exposure to
actual or potential claims and lawsuits involving our business
and assets. We are currently party to a number of lawsuits
consisting of ordinary, routine litigation incidental to our
business, including general and product liability and
workers compensation claims. We believe that any
liabilities resulting from these claims, after taking into
account amounts already

8



---



##### Table of Contents










Item 4.  Submission of Matters to a Vote of
Security Holders


The Company did not submit any matter to a vote of its
stockholders during the fourth quarter of 1999.

PART II






Item 5.  Market for Registrants Common
 Equity and Related Stockholder Matters


Our common stock is traded on the New York Stock Exchange under
the symbol DL. The following table sets forth the high and low
closing sale prices as reported on the NYSE for the periods
indicated. The closing sale price of the common stock on
March 22, 2000, was $13.75 per share.

|            |                |             |  |          |  |  |  |          | 
|----------- | -------------- | ----------- |  | -------- |  |  |  | -------- | 
|            |                |            
|            |                | Price Range
|            |                |            
|            |                | High        |  | Low     
|            |                |             |  |         
|Fiscal 1999 |                |             |  |          |  |  |  |         
|           
|           
|           
|           
|            | First Quarter  |             |  | 35 7/16  |  |  |  | 27 5/16  | 
|           
|           
|           
|           
|            | Second Quarter |             |  | 38 3/8   |  |  |  | 30 5/16  | 
|           
|           
|           
|           
|            | Third Quarter  |             |  | 36 7/8   |  |  |  | 25       | 
|           
|           
|           
|           
|            | Fourth Quarter |             |  | 28 3/8   |  |  |  | 23 1/16  | 
|           
|           
|           
|           
|Fiscal 1998 |                |             |  |          |  |  |  |         
|           
|           
|           
|           
|            | First Quarter  |             |  | 25 1/4   |  |  |  | 19 15/16 | 
|           
|           
|           
|           
|            | Second Quarter |             |  | 26       |  |  |  | 22 5/8   | 
|           
|           
|           
|           
|            | Third Quarter  |             |  | 25 5/16  |  |  |  | 19 1/2   | 
|           
|           
|           
|           
|            | Fourth Quarter |             |  | 29 11/16 |  |  |  | 19 15/16 | 

We declared dividends of $0.08 per share of Common Stock in the
first, second, third and fourth quarters of 1999 and 1998. The
declaration and payment of dividends is subject to the discretion
 of our Board of Directors. Any future determination to pay
dividends will depend on our results of operations, financial
condition, capital requirements, contractual restrictions and
other factors deemed relevant at the time by the Board. As of
March 22, 2000, there were 94,774,757 shares of common stock
 outstanding, which were held by 35,142 stockholders of record.






Item 6.  Selected Financial and Other Data


The following table presents selected financial information
derived from our consolidated financial statements. The selected
consolidated balance sheet data as of December 31, 1999, and
 December 31, 1998, and the consolidated income statement
data for each of the three fiscal years in the period ended
December 31, 1999, have been derived from our audited
consolidated financial statements. The selected consolidated
balance sheet data as of January 3, 1998, December 28,
1996, and December 30, 1995, and consolidated income
statement data for the fiscal years ended December 28, 1996,
 and December 30, 1995 been derived from the audited
consolidated financial statements of Dial which are not included
in this Form 10-K.

Prior to August 1996, we operated as the consumer products
business of Viad Corp. Viad, our former parent, was then known as
 The Dial Corp. In August 1996, former parent declared a dividend
 and distributed to its stockholders all the outstanding common
stock causing us to become a separately publicly traded company.
This transaction is known as the Spin-off. We have operated as
The Dial Corporation since the Spin-off.

The following data should be read in conjunction with our
consolidated financial statements and notes thereto,
Item 7. Managements Discussion and Analysis of
Results of Operations and Financial Condition and the other
 financial information included elsewhere or incorporated by
reference in this Form 10-K.

9



---



##### Table of Contents



SELECTED FINANCIAL AND OTHER DATA

(in thousands, except per share data, number of employees and
shareholders of record)


|                                                  |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |         | 
|------------------------------------------------- | ----------------- | ---------- | --------- | ------- |  | ------ | --------- | ------- |  | ------- | --------- | ------- |  | - | --------- | ------- |  | - | --------- | ------- | 
|                                                  |                   |           
|                                                  |                   | Year ended
|                                                  |                   |           
|                                                  |                   | Dec. 31    |           | Dec. 31 |  | Jan. 3 |           | Dec. 28 |  | Dec. 30
|                                                  |                   | 1999       |           | 1998    |  | 1998   |           | 1996    |  | 1995   
|                                                  |                   |            |           |         |  |        |           |         |  |        
|Operations                                        |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|                                                 
|                                                 
|                                                 
|                                                 
|Net sales                                         |                   | $          | 1,721,566 |         |  | $      | 1,524,517 |         |  | $       | 1,362,606 |         |  | $ | 1,406,400 |         |  | $ | 1,365,290 |        
|                                                  |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|Cost of products sold                             |                   |            | 860,811   |         |  |        | 787,401   |         |  |         | 718,112   |         |  |   | 739,893   |         |  |   | 709,888   |        
|                                                 
|                                                 
|                                                 
|                                                 
|Write-down of discontinued product inventories    |                   |            |           |         |  |        |           |         |  |         |           |         |  |   | 27,924    |         |  |   | 20,400    |        
|                                                  |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|Total cost of products sold                       |                   |            | 860,811   |         |  |        | 787,401   |         |  |         | 718,112   |         |  |   | 767,817   |         |  |   | 730,288   |        
|                                                  |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|                                                  | Gross profit      |            |           | 860,755 |  |        |           | 737,116 |  |         |           | 644,494 |  |   |           | 638,583 |  |   |           | 635,002 | 
|                                                 
|                                                 
|                                                 
|                                                 
|Selling, general and administrative expenses      |                   |            | 645,613   |         |  |        | 553,181   |         |  |         | 482,324   |         |  |   | 541,110   |         |  |   | 523,058   |        
|                                                 
|                                                 
|                                                 
|                                                 
|Restructuring charges and other asset write-downs |                   |            |           |         |  |        |           |         |  |         |           |         |  |   | 27,076    |         |  |   | 135,600   |        
|                                                  |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|                                                  |                   |            | 645,613   |         |  |        | 553,181   |         |  |         | 482,324   |         |  |   | 568,186   |         |  |   | 658,658   |        
|                                                  |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|Operating income (loss)                           |                   |            | 215,142   |         |  |        | 183,935   |         |  |         | 162,170   |         |  |   | 70,397    |         |  |   | (23,656   | )      
|                                                 
|                                                 
|                                                 
|                                                 
|Spin-off transaction costs                        |                   |            |           |         |  |        |           |         |  |         |           |         |  |   | 5,000     |         |  |   |           |        
|                                                 
|                                                 
|                                                 
|                                                 
|Interest and other expenses                       |                   |            | 32,712    |         |  |        | 23,358    |         |  |         | 28,235    |         |  |   | 22,974    |         |  |   | 23,360    |        
|                                                 
|                                                 
|                                                 
|                                                 
|Net Earnings (Loss) of Joint Venture              |                   |            | (1,347    | )       |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|                                                  |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|Income (loss) before income taxes                 |                   |            | 181,083   |         |  |        | 160,577   |         |  |         | 133,935   |         |  |   | 42,423    |         |  |   | (47,016   | )      
|                                                 
|                                                 
|                                                 
|                                                 
|Income taxes (benefit)                            |                   |            | 64,317    |         |  |        | 57,961    |         |  |         | 50,225    |         |  |   | 12,511    |         |  |   | (19,527   | )      
|                                                  |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|Net income (loss)(1)                              |                   | $          | 116,766   |         |  | $      | 102,616   |         |  | $       | 83,710    |         |  | $ | 29,912    |         |  | $ | (27,489   | )      
|                                                  |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|Net income per share(2)                           |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Basic             |            | $         | 1.19    |  |        | $         | 1.04    |  |         | $         | 0.91    |  |   | $         | 0.33    |  |   |           |         | 
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Diluted           |            | $         | 1.17    |  |        | $         | 1.02    |  |         | $         | 0.89    |  |   | $         | 0.33    |  |   |           |         | 
|                                                 
|                                                 
|                                                 
|                                                 
|Basic shares outstanding(2)                       |                   |            | 98,255    |         |  |        | 98,294    |         |  |         | 91,918    |         |  |   | 89,705    |         |  |   |           |        
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Equivalent shares |            |           | 1,810   |  |        |           | 2,185   |  |         |           | 2,231   |  |   |           | 1,269   |  |   |           |         | 
|                                                  |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|                                                  | Diluted shares    |            |           | 100,065 |  |        |           | 100,479 |  |         |           | 94,149  |  |   |           | 90,974  |  |   |           |         | 
|                                                  |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|Balance Sheet Data (at year end)                  |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|                                                 
|                                                 
|                                                 
|                                                 
|Total assets                                      |                   | $          | 1,269,686 |         |  | $      | 1,175,375 |         |  | $       | 883,852   |         |  | $ | 866,126   |         |  | $ | 798,405   |        
|                                                 
|                                                 
|                                                 
|                                                 
|Working capital (deficit)                         |                   |            | 14,490    |         |  |        | (11,535   | )       |  |         | (11,797   | )       |  |   | 41,107    |         |  |   | 45,663    |        
|                                                 
|                                                 
|                                                 
|                                                 
|Parent investment and advances                    |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   | 496,230   |        
|                                                 
|                                                 
|                                                 
|                                                 
|Long-term debt                                    |                   |            | 300,951   |         |  |        | 280,223   |         |  |         | 84,399    |         |  |   | 269,515   |         |  |   | 3,320     |        
|                                                 
|                                                 
|                                                 
|                                                 
|Common stock and other equity(2)                  |                   |            | 411,271   |         |  |        | 390,225   |         |  |         | 320,046   |         |  |   | 140,657   |         |  |   |           |        
|                                                 
|                                                 
|                                                 
|                                                 
|Other Data                                        |                   |            |           |         |  |        |           |         |  |         |           |         |  |   |           |         |  |   |           |        
|                                                 
|                                                 
|                                                 
|                                                 
|Depreciation and amortization                     |                   |            | 43,130    |         |  |        | 36,489    |         |  |         | 31,763    |         |  |   | 30,533    |         |  |   | 29,118    |        
|                                                 
|                                                 
|                                                 
|                                                 
|Capital expenditures                              |                   |            | 62,495    |         |  |        | 50,330    |         |  |         | 46,715    |         |  |   | 49,468    |         |  |   | 27,214    |        
|                                                 
|                                                 
|                                                 
|                                                 
|Number of employees (end of year)                 |                   |            | 3,754     |         |  |        | 3,759     |         |  |         | 3,548     |         |  |   | 2,812     |         |  |   | 3,985     |        
|                                                 
|                                                 
|                                                 
|                                                 
|Number of employees (average)                     |                   |            | 3,757     |         |  |        | 3,654     |         |  |         | 3,180     |         |  |   | 3,125     |         |  |   | 3,992     |        
|                                                 
|                                                 
|                                                 
|                                                 
|Dividends on common shares(2)                     |                   |            | 31,407    |         |  |        | 31,497    |         |  |         | 29,510    |         |  |   | 14,365    |         |  |   |           |        




|    |                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Includes restructuring charges and asset
	write-downs and Spin-off transaction costs of $60 million ($35.3
	million after tax) or $0.39 per share in 1996 and restructuring
	charges and asset write-downs of $156 million ($94.9 million
	after tax) in 1995.                                                                                                                                                              
|   
|(2) | Per share, common stock and other equity and
	dividends on common shares information is not presented for 1995
	because we were not a publicly held company during 1995. Net
	income per share is presented for 1996, as our common shares were
	 issued on August 15, 1996. The calculation of income per
	share in 1996 assumes that the common shares and common share
	equivalents were outstanding for the entire year.

10



---



##### Table of Contents






Item 7.  Managements Discussion and
Analysis of Results of Operations and Financial Condition

Overview

For organizational, marketing, financial reporting and method of
distribution, we have organized our business into three segments:
 Domestic Branded, International and Commercial Markets and
Other.

Beginning with 1998, our fiscal year-end is December 31.
Prior to 1998, our fiscal year ended on the Saturday closest to
the end of December. Fiscal years 1999 and 1998 consisted of
52 weeks while fiscal year 1997 consisted of 53 weeks.

Recent Developments

We recently announced that we expect our earnings to be down for
the first half of 2000 versus our plan and the same period a year
 ago. We believe certain events leading to these lower than
expected earnings will impact both sales and gross margin for the
 first and second quarters of 2000. We believe that the factors
relating to the sales shortfall are primarily:



| |   |                                                                                                                                                                                                                        
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | The consolidation and balancing of inventory that occurred when
	our second largest customer converted from buying direct to
	buying through two wholesalers;                                                          
|
| |  | The continuing price war between two of our competitors in the
	premium segment of the Argentina detergent market which has had
	an adverse impact on Dials value brand detergent in
	Argentina;                      
|
| |  | A shortfall on the sale of Armour canned meats due to increased
	Y2K-related retail inventory buildup at years end, coupled
	with a price increase taken by Dial in January that has not been
	matched by competition.

In addition, our sales are now lower and the mix of products sold
 is different than earlier anticipated and this could have an
adverse impact on our gross margin and earnings.

Our gross margin in the first half will be impacted by the
reduced manufacturing overhead absorption associated with the
lower than expected sales volumes and the increasing cost of
petroleum that affects, among other things, transportation and
distribution expenses.

See additional discussion of matters that may impact our results
in Factors That May Affect Future Results and Financial
Condition.

Fiscal 1999 Compared With Fiscal 1998

Net sales increased $197.1 million, or 12.9%, to $1,721.6 million
 in 1999 from $1,524.5 million in 1998. This increase resulted
from strong growth in Purex, Dial, Armourand Renuzitfranchises which grew at 14%, 5%, 6% and 21%, respectively.
Sales from Freeman Cosmetic Corporation, acquired in July of
1998, and Sarah Michaels, Inc., acquired in September of 1998,
also contributed to the increase. The Purexfranchise
instituted a price increase beginning in January of 1999. Sales
net of the Purexprice increase improved 11% for the year.

Domestic Branded net sales increased $186.1 million, or 14.4%, to
 $1,477.4 million in 1999 from $1,291.3 million in 1998. The
increase resulted primarily from the inclusion of Sarah Michaels
and Freeman acquisitions and strong sales growth in the core
franchises. Domestic Branded sales net of the Purex price
increase improved 12% for 1999.

International net sales increased $10.5 million, or 6.4%, to
$174.6 million from $164.1 million in 1998, primarily as a result
 of increased sales in Canada of 18% and Mexico of 5%. Sales in
Argentina were up 2% for the year but were slowed as a result of
new competition which led to a detergent price war, and a
lingering recession.

Commercial Markets and Other net sales remained relatively flat
at $69.6 million in 1999 compared to $69.1 million in 1998. In
late 1999, we sold the rights to our merchant surfactant business
 for an immaterial amount. During 2000, we intend to use
internally all of our manufactured surfactants.

11



---



##### Table of Contents



Gross profit margin increased 1.6 points to 50.0% in 1999 from
48.4% in 1998 resulting primarily from the Purexprice
increase and continuing improvement in manufacturing efficiencies
 in the manufacturing facilities. Gross profit margin net of the
Purexprice increase was 49.2% for 1999.

Selling, general and administrative expenses for 1999 increased
$92.4 million, or 16.7%, to $645.6 million from $553.2 million in
 1998. The increase was primarily due to higher marketing expense
 to support core business-merchandising initiatives including the
 Purex price increase, new product launches, and amortization of
goodwill and incremental administrative expense associated with
the acquisitions of Freeman and Sarah Michaels.

Operating income in 1999 increased $31.2 million, or 17.0%, to
$215.1 million from $183.9 million in 1998. The increase was
primarily due to increased sales and gross margin improvements.

Our share of the loss in the joint venture between us and Henkel
KGaA was $1.3 million in 1999. We use the equity method of
accounting to account for the joint venture and report earnings
as a single line item after operating income. See additional
discussion of the joint venture in Other Matters 
Dial/ Henkel Joint Venture.

Interest and other expense increased $9.4 million, or 40.2%, to
$32.7 million for 1999 compared to $23.4 million in 1998. The
increase was primarily due to increased debt to fund the Freeman
and Sarah Michaels acquisitions and the impact of the share
repurchase program.

The Companys consolidated effective income tax rate for
1999 was 35.5%, down from 36.1% for 1998. The lower effective tax
 rate in 1999 was primarily due to lower state and foreign taxes.

Net income increased $14.2 million, or 13.8%, to $116.8 million
in 1999 from $102.6 million in 1998. The increase was primarily
due to increased sales, gross margin improvements and a decrease
in our effective tax rate offset in part by a loss in the Dial/
Henkel LLC joint venture of $1.3 million.

Fiscal 1998 Compared with Fiscal 1997

Net sales increased $161.9 million, or 11.9%, to $1,524.5 million
 in 1998 from $1,362.6 million in 1997. Net sales in 1997
included $53 million of net sales from brands that were divested
in the third quarter of 1997. Net sales in 1998 increased
primarily as a result of a full-year contribution from Nuevo
Federal, acquired in September 1997; two quarters of sales
from Freeman, acquired in July 1998; and one quarter of
sales from Sarah Michaels, acquired in September 1998.

Domestic Branded net sales increased $141.6 million, or 12.3%, to
 $1,291.3 million in 1998 from $1,149.7 million in 1997. The
increase in net sales was the result of the inclusion of the
Sarah Michaels and Freeman acquisitions, and sales growth in Dial, up 12.3%; Renuzit, up 12.1%; and Purex,
up 5.6%. The increase in sales was offset in part by a 1.9%
decline in Armoursales.

International net sales increased $81.9 million, or 99.8%, to
$164.1 million from $82.2 million in 1997. The increase in net
sales resulted primarily from the inclusion of a full year of
results of Nuevo Federal and sales growth of 30.7% in Canada,
10.0% in Mexico and 7.0% in the Caribbean. In addition, Nuevo
Federals sales grew 24% in the fourth quarter of 1998 over
the same period in 1997. The increase in net sales was offset in
part by a 52.3% decline in sales to Asia.

Commercial Markets and Other net sales decreased $8.7 million, or
 11.2%, to $69.1 million in 1998 from $77.8 million in 1997,
primarily as a result of softness in the pricing of sulfonate
chemicals, glycerin and fatty acids.

Gross profit margin increased 1.1 points to 48.4% in 1998 from
47.3% in 1997. The increase resulted primarily from significant
improvement in manufacturing efficiencies and favorable raw
material prices.

Selling, general and administrative expenses for 1998 increased
$70.9 million, or 14.7%, to $553.2 million from $482.3 million in
 1997. The increase was primarily due to higher marketing expense
 to support core business merchandising initiatives, new product
launches and core business advertising.

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Operating income in 1998 increased $21.7 million, or 13.4%, to
$183.9 million from $162.2 million in 1997. The increase was
primarily due to increased sales and gross margin improvements.

Interest and other expenses decreased $4.8 million, or 17.3%, to
$23.4 million for 1998 compared to $28.2 million in 1997
primarily as a result of lower average monthly debt balances
outstanding.

The Companys consolidated effective income tax rate for
1998 was approximately 36.1%, down from 37.5% for 1997. The lower
 effective tax rate in 1998 was primarily due to lower state and
foreign taxes.

Net income increased $18.9 million, or 22.6%, to $102.6 million
in 1998 from $83.7 million in 1997. The increase was primarily
due to increased sales, gross margin improvements and a lower
effective tax rate.

Liquidity and Capital Resources

We generated cash from operations of $121.8 million during 1999
compared to cash generated of $122.3 million during the same
period in 1998. The decrease resulted primarily from higher
accounts receivable and an increase in inventories due to new
products and a slight build up at year-end as a Year 2000
contingency. The decrease was partially offset by improvements in
 net income, higher depreciation expense attributable to
information technology software and amortization of Freeman and
Sarah Michaels goodwill.

Capital expenditures for 1999 were $62.5 million versus $50.3
million for the comparable period in 1998. Capital spending in
2000 is expected to approximate $60 million and will be
concentrated primarily on equipment and information systems that
provide opportunities to reduce manufacturing, logistic and
administrative costs. However, such plans are dependent on the
availability of funds, as well as identification of projects with
 sufficient returns. As a result, there can be no assurance as to
 the quantity and the type of capital spending in the future.

Our financing plan includes the sale of accounts receivable to
accelerate cash flow. During June 1999, the maximum amount
of receivables that could be sold under this plan was increased
from $90.0 million to $115.0 million, in line with higher sales.
Accounts receivable sold but not yet collected under this plan at
 December 31, 1999, and December 31, 1998, was $73.2
million and $90.0 million, respectively. Under the terms of the
plan, we retain the risk of credit loss on the receivables sold.

In July 1999, we established a $350 million commercial paper
 program, which allows us to access the commercial paper market
for short-term borrowing needs. The commercial paper program is
supported by our Credit Agreement. Accordingly, borrowings under
the commercial paper program are classified as long-term debt. At
 December 31, 1999, we had $101.8 million outstanding in
commercial paper, bearing interest at rates ranging from 5.72% to
 6.55%.

We intend to discontinue the sale of accounts receivable program
in 2000 and utilize short-term bank borrowings and commercial
paper as our principal financing vehicles.

At December 31, 1999, we had $350 million available under
the credit agreement. Borrowings under the Credit Agreement are
on a revolving basis under commitments available until
August 15, 2002. The interest rate applicable to borrowings
under the Credit Agreement is, at our option, indexed to the bank
 prime rate or the London Interbank Offering Rate
(LIBOR), plus appropriate spreads over such indices
during the period of the Credit Agreement. The Agreement also
provides for commitment fees. These spreads and fees may change
should our debt ratings change.

We make use of short-term bank borrowings when needed. The
borrowings are unsecured and generally have maturities between 1
and 30 days and bear interest at LIBOR plus appropriate
spreads. The banks that provide the borrowings do so on an
uncommitted basis.

Beginning in the third quarter of 1999, short-term bank
borrowings, previously classified as long-term debt because they
were supported by the credit agreement, are being classified as
short-term debt because the credit agreement is being used to
support our commercial paper program.

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On July 1, 1998, we acquired Freeman for $78 million in
cash, which was financed through short-term borrowings supported
by our long-term credit agreement. The acquisition price reflects
 a $6 million reduction in the purchase price for Freeman as a
result of a net worth adjustment received in January 1999.

On September 14, 1998, we acquired Sarah Michaels for $187
million in cash, which was financed through short-term borrowings
 supported by our long-term credit agreement.

On September 23, 1998, we completed a $200 million public
offering of 6.5% Senior Notes due 2008. The proceeds of the debt
financing were used to repay outstanding bank borrowings used for
 the acquisitions of Freeman and Sarah Michaels. The Indenture
governing these Senior Notes imposes restrictions on us with
respect to, among other things, our ability to redeem the Senior
Notes, to place liens on certain properties and to enter into
certain sale and leaseback transactions.

We received approximately $10.7 million from the disposition of
assets during 1998, the majority of which resulted from two
sales. The Purex Toss n Soft® brand and
related inventories were sold for approximately $5.3 million and
a nonoperating manufacturing property was sold for $4.0 million.
No gain or loss was realized on either of the transactions.

As part of our business strategy, we routinely review and
evaluate the acquisition of domestic and international companies
that market consumer and other products. We may seek additional
debt and/or equity financing as necessary to fund any potential
acquisitions.

At December 31, 1999, and December 31, 1998, we held a
total of 4,887,176 and 1,176,082 shares, respectively, in
treasury. The shares held at December 31, 1999, include
218,725 shares valued at $5.2 million purchased as part of a
small shareholder selling/repurchasing program executed during
the first quarter of 1998 and 4,476,604 shares valued at $121.3
million purchased as part of our stock repurchase programs.

At December 31, 1999, we had approximately $83.1 million in
net deferred tax benefits. The realization of these benefits will
 require average annual taxable income of approximately $16.0
million over the next 15 years. Our average income before
income taxes over the past three years was approximately $159.0
million.

Other Matters

Dial/ Henkel Joint Venture

In April 1999, we formed Dial/ Henkel LLC, a joint venture
with Henkel KGaA of Düsseldorf, Germany. Dial and Henkel
each own 50% of this joint venture. This joint venture was formed
 to develop and market a range of enhanced laundry products in
North America. In July 1999, the joint venture acquired the
Custom Cleaner, Inc.® home dry cleaning
business. In December 1999, the joint venture launched Purex Advanced®.

We include our share of the joint venture operating results in
our financial statements using the equity method of accounting.
In 1999, our share of the loss in the joint venture was $1.3
million. The joint venture net sales for 1999, although not
consolidated in our 1999 financial statements, were $10.7
million.

New Accounting Pronouncements

The Financial Accounting Standards Board has issued Statement of
Financial Accounting Standards No. 133 Accounting for
Derivative Instruments and Hedging Activities. We will be
required to adopt this new standard in the first quarter of 2001.
 This statement requires that all derivatives be recorded in the
balance sheet as either an asset or liability measured at fair
value. The statement requires that changes in a
derivativess fair value be recognized currently in earnings
 unless specific hedge accounting criteria are met. We are still
in the process of evaluating this statement and the impact on our
 consolidated financial statements.

Factors That May Affect Future Results and Financial
Condition.

Our future results and financial condition are dependent upon our
 ability to successfully develop, manufacture and market consumer
 products. Inherent in this process are a number of factors that
we must

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| |   |                                                                                                                                                                   
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We face intense competition in a mature industry that may
	require us to increase expenditures and lower profit margins to
	preserve or maintain our market share.

Currently, we depend primarily on sales generated in U.S. markets
 (90% of sales in 1999). U.S. markets for consumer products are
mature and characterized by high household penetration,
particularly with respect to our most significant product
categories, including detergents and bar soaps. We may not be
able to succeed in implementing our strategies to increase
domestic revenues. Our unit sales growth in domestic markets will
 depend on increasing usage by consumers, product innovation and
capturing market share from competitors.

The consumer products industry, particularly the detergent,
personal care and air freshener categories, is intensely
competitive. To protect our existing market share or to capture
increased market share, we may need to increase expenditures for
promotions and advertising and to introduce and establish new
products. Additional expenditures could lower our profit margins.
 Moreover, these additional measures and increased expenditures
may not prove successful in maintaining or enhancing our market
share. For example, we recently formed a joint venture with
Henkel KGaA to introduce enhanced laundry products. This joint
venture recently introduced Purex Advanced, an enzyme-based
detergent, and began a national rollout of Custom Cleaner, a home
 dry cleaning product. If sales for these new products do not
meet expectations, it would adversely impact our expected
operating results for 2000.

Many of our competitors are large companies, including The
Procter & Gamble Company, Lever Brothers Co.,
Colgate-Palmolive Company, and S.C. Johnson & Son, Inc.,
which have greater financial resources than we do. They could
outspend us in an attempt to take market share from us.



| |   |                                                                                                        
| | - | -------------------------------------------------------------------------------------------------------
| |  | Price-cutting measures in response to competitive pressures
	 could result in decreased profit margins.

Consumer products, particularly those that are value-priced, are
subject to significant price competition. From time to time, we
may need to reduce the prices for some of our products to respond
 to competitive and consumer pressures and to maintain market
share. If our sales volumes fail to grow sufficiently to offset
any reduction in margins, our results of operations would be
materially adversely affected.



| |   |                                                                                                                                                            
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Our inability to provide price concessions or trade terms
	that are acceptable to our trade customers could adversely affect
	 our sales and profitability.

Because of the competitive environment facing retailers, we face
pricing pressure from these customers. Many of our trade
customers, particularly our high-volume retail store customers,
have increasingly sought to reduce inventory levels and obtain
pricing concessions or better trade terms. If we are unable to
maintain price or trade terms that are acceptable to our trade
customers, they could increase product purchases from our
competitors, which would adversely affect our sales and
profitability. In addition, consolidation within the retail
industry could potentially reduce inventory levels maintained by
our retail customers which could adversely impact our operating
results. Our performance is also dependent upon the general
health of the retail environment and could be materially affected
 by changes affecting retailing and by the financial difficulties
 of retailers.



| |   |                                                                                           
| | - | ------------------------------------------------------------------------------------------
| |  | Loss of our principal customers could significantly
	decrease our sales and profitability.

Our top ten customers accounted for 42% of net sales in 1999.
Wal-Mart, including its affiliate Sams Club, was our
largest customer, accounting for 18% of net sales in 1999. The
loss of or a substantial decrease in the volume of purchases by
Wal-Mart or any of our other top customers could have a material
adverse effect on sales and profitability.



| |   |                                                                                     
| | - | ------------------------------------------------------------------------------------
| |  | Price increases in certain raw materials could adversely
	affect our profit margins.

Rapid increases in the prices of certain raw materials could
materially impact our profit margins. For example, tallow (a key
ingredient in Dial bar soaps) has experienced price fluctuations
within the range of $0.10 and $0.28 per pound from
January 1, 1995, to December 31, 1999. Recently, the
price of tallow has been

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| |   |                                                            
| | - | -----------------------------------------------------------
| |  | Our international expansion efforts may prove unsuccessful.

In 1999, 90% of our sales were generated in U.S. markets. We have
 adopted a strategy to continue to penetrate international
markets to supplement our domestic revenues. However, there can
be no assurance that we will succeed in increasing our
international business in a profitable manner. In implementing
this strategy, we face barriers to entry and the risk of
competition from local and other companies that already have
established global businesses, risks generally associated with
conducting business internationally, including exposure to
currency fluctuations, limitations on foreign investment,
import/export controls, nationalization, unstable governments and
 legal systems, and the additional expense and risks inherent in
operating in geographically and culturally diverse locations.
Because we plan to develop our international business through
acquisitions as well as joint ventures, co-packaging arrangements
 and/or other alliances, we also may be subject to risks
associated with such arrangements, including those relating to
the combining of different corporate cultures and shared decision
 making. In addition, since our current international
distribution capabilities are extremely limited, we also may need
 to acquire a distribution network or enter into alliances with
existing distributors before we can effectively conduct
operations in new markets.



| |   |                                                                                                                    
| | - | -------------------------------------------------------------------------------------------------------------------
| |  | The FDA could impose standards that negatively impact our
	ability to market some of our products as antibacterial.

Since the 1970s, the Food and Drug Administration has
regulated antibacterial soaps and hand washes under a proposed
regulation. Although the proposed regulation has not been
finalized, the FDA ultimately could set standards that result in
limiting or even precluding soap manufacturers from using some
current antibacterial ingredients or making antibacterial claims
for some product forms, such as bar soap. Dial, which uses the
antibacterial ingredient Triclosan in Liquid Dial and
Triclocarban in Dial bar soap, emphasizes the antibacterial
properties of its soap products in its marketing campaigns and
product labeling. Any final FDA regulation that limits or
precludes this type of advertising could require Dial to develop
new marketing campaigns, develop new products or utilize
different antibacterial ingredients in its products, all of which
 could materially adversely affect our business.



| |   |                                                                                                              
| | - | -------------------------------------------------------------------------------------------------------------
| |  | We could become the subject of adverse publicity or product
	 recalls that negatively impacts our operations.

Adverse publicity regarding our products could impact the sales
of our products. Some news broadcasts by major U.S. television
and radio networks have focused on the use of antibacterial
agents to kill germs on various surfaces. Triclosan, the active
ingredient in Liquid Dial, also has been a focus of these
broadcasts. Although none of the broadcasts disputed that
Triclosan kills germs on the skin, some third party experts did
question whether it provides any additional protection beyond
that provided by nonantibacterial soap products. Although we have
 test results that we believe prove that Triclosan provides
consumers with additional protection in limiting exposure to
bacteria-related diseases, there can be no assurance that our
Triclosan products, or other products, will not be the subject of
 adverse publicity in the future.

From time to time, consumer product companies, including Dial,
have had to recall certain products for various reasons. The
costs of recall or other related liabilities could materially
lower our profit margins. Adverse publicity regarding any product
 recalls also could materially affect our sales.

We share the use of the Armour trademark for food products with
ConAgra Inc., the manufacturer of Armour-branded non-canned meat
products. Accordingly, we face the added risk that consumer
preferences and perceptions with respect to any of our Armour
products may be influenced by adverse publicity affecting any of
the Armour-branded products of ConAgra, Inc.

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| |   |                                                                                                
| | - | -----------------------------------------------------------------------------------------------
| |  | We may incur unexpected expenses due to environmental
	concerns regarding a detergent compound.

Nonlyphenol ethoxylate is an ingredient used in our liquid and
powder detergent products. Certain environmental and regulatory
groups have raised concerns regarding the toxicity of compounds
produced from nonlyphenol ethoxylate as it decomposes and the
adverse impact on the reproductive health of certain aquatic
animals exposed to those compounds. Although to our knowledge
none of the studies undertaken on nonlyphenol ethoxylate has
demonstrated a link between the compound and such effect in the
environment or in human beings, there can be no assurance that
subsequent studies will not in fact demonstrate such a link or
demonstrate other adverse environmental consequences. Current
government regulations do not impose any restrictions on the use
of nonlyphenol ethoxylate, or impose any liability on any of the
businesses that utilize nonlyphenol ethoxylate in the products
they manufacture. We believe, however, that a number of
governmental agencies in North America and Europe are discussing
formal regulation of nonlyphenol ethoxylate in the environment.
We are in the process of reformulating our detergents to
eliminate this compound as an ingredient.



| |   |                                                                
| | - | ---------------------------------------------------------------
| |  | We may incur unexpected expenses due to environmental
	matters.

We are subject to a variety of environmental and health and
safety laws in each jurisdiction in which we operate. These laws
and regulations pertain to our present and past operations.
Although we currently do not anticipate that the costs to comply
with environmental laws and regulations will have a material
adverse effect on our capital expenditures, earnings or
competitive position, the emergence of unforeseen claims or
liabilities or the imposition of increasingly stringent laws,
regulations and enforcement policies could result in material,
unreserved costs in the future. Since 1980, we have received
notices or requests for information with respect to
Superfund sites under the federal Comprehensive
Environmental Response, Compensation and Liability Act, five of
which are currently active. As of December 31, 1999, we have
 accrued in our financial statements approximately $2.3 million
in reserves for expenses related to Superfund sites and the
clean-up of closed plant sites. We believe our reserves are
adequate, but these costs are difficult to predict with
certainty.



| |   |                                                                          
| | - | -------------------------------------------------------------------------
| |  | Loss of key managerial personnel could negatively impact
	our operations.

Our operation requires managerial expertise. Of our key
personnel, only the Chief Executive Officer has an employment
contract with us. There can be no assurance that any of our key
employees will remain in our employ. The loss of key personnel
could have a material adverse effect on our operations.



| |   |                                                                                     
| | - | ------------------------------------------------------------------------------------
| |  | We may make acquisitions that prove unsuccessful or strain
	or divert our resources.

We recently acquired two consumer products companies, Freeman
Cosmetic Corporation and Sarah Michaels, and formed a joint
venture company with Henkel KGaA. In addition, the joint venture
company formed with Henkel recently acquired the Custom Cleaner
home dry-cleaning business. We may acquire or make substantial
investments in complementary businesses or products in the
future. The Freeman, Sarah Michaels and Custom Cleaner
acquisitions entailed, and any future acquisitions or investments
 would entail, various risks, including the difficulty of
assimilating the operations and personnel of the acquired
businesses or products, the potential disruption of our ongoing
business and, generally, our potential inability to obtain the
desired financial and strategic benefits from the acquisition or
investment. These factors could have a material adverse effect on
 our financial results. For example, during 2000 we will
consolidate our Sarah Michaels, Freeman Cosmetics and
Natures Accents businesses. This consolidation could have a
 short-term impact on the sales and profit margin of these
businesses, which could adversely impact our expected operating
results for 2000.

Our future acquisitions and investments also could result in
substantial cash expenditures, potentially dilutive issuances of
equity securities, the incurrence of additional debt and
contingent liabilities, and amortization expenses related to
goodwill and other intangible assets, which could adversely
affect our financial results and condition.

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Item 7A.  Quantitative and Qualitative
Disclosure About Market Risk

The following discussion of our exposure to various market risks
contains forward looking statements that involve
risks and uncertainties. These projected results have been
prepared utilizing certain assumptions considered reasonable in
light of information currently available to us. Nevertheless,
because of the unpredictability of interest rates, foreign
currency rates and commodity prices, and other factors, actual
results could differ materially from those projected in this
forward looking information.

Our use of financial instruments is limited to purposes other
than trading and primarily includes management of employee
benefits and commodity expense. We may use financial instruments
for the management of interest rate, foreign currency or other
risks in the future.

Interest Rate Risk

We have short-term debt, short-term bank borrowings, a commercial
 paper program supported by a long-term revolving credit
agreement and a receivables purchase and sale program which
subject us to the risk of loss associated with movements in
market interest rates.

At December 31, 1999, we had $60.2 million in short-term
borrowings outstanding including $16.3 million in borrowings by
our Argentinean subsidiary, $73.2 million in receivables sold but
 not collected and $301 million in long-term debt outstanding. Of
 the long-term debt outstanding, $198 million is fixed-rate debt
(6.5%) and, accordingly, does not expose us to risk of earnings
loss due to changes in market interest rates. Both the short-term
 debt of $60.2 million and the remaining $101.8 million of
commercial paper issuances (which are classified as long-term
debt because they are supported by the long-term credit
agreement) have maturities of between one and 60 days.
Accordingly, the interest rates associated with those borrowings
reset as the borrowings mature and are renewed. In addition, the
receivables purchase and sale program allows us to sell our trade
 receivables prior to collection at a discount that closely
approximates the 30-day London Interbank Borrowing Rate
(LIBOR). This discount rate reprices monthly.

At December 31, 1999, the short-term debt had a weighted
average interest rate of 7.04%, the commercial paper issuances
had a weighted average interest rate of 6.32%, and the discount
paid on the sale of receivables program was 6.12%. If the
floating rates were to change by 10% from December 31, 1999,
 levels, annual interest expense associated with the
floating-rate debt would change by approximately $1.3 million
before tax and the annual discount paid for the sale of
receivables not yet collected would change by approximately
$500,000 before tax.

Foreign Currency

We are subject to exposure from fluctuations in foreign currency
exchange rates, primarily U.S. Dollar/ Canadian Dollar, U.S.
Dollar/ Mexican Peso and U.S. Dollar/ Argentinean Peso.

The Argentinean Pesos value has been pegged by
the Argentinean government as equal to the U.S. Dollar. Through
December 31, 1999, this currency equivalency applied.
However, there can be no assurance in the future that the
Argentinean government will continue this policy or have the
ability to ensure that the value of the Argentinean Peso will
continue to equal the U.S. Dollar.

At December 31, 1999, one U.S. Dollar was worth 1.45
Canadian Dollars and 9.51 Mexican Pesos, respectively. For the
year ended December 31, 1999, the U.S. Dollar/ Canadian
Dollar exchange rate fluctuated between a high of $1.00/ C$1.54
to $1.00/ C$1.45 and the U.S. Dollar/ Mexican Peso exchange rate
fluctuated between $1.00/ P$10.60 and a low of $1.00/ P$9.27. If
there were a 10% change in the exchange rates for the U.S. Dollar
 to the Canadian Dollar, the Mexican Peso and the Argentinean
Peso from those at December 31, 1999, we would have an
annual currency translation gain or loss of approximately $2.5
million before tax.

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Commodity Price Risk

In the manufacture of our products we utilize a number of
commodities, such as tallow, coconut oil and meat. In addition,
we use a variety of products that are priced based on underlying
commodities, such as plastic bottles (resin). In the normal
course of business, we attempt to enter into supply agreements
that generally fix or set a range of prices of goods to be
purchased. These supply agreements can cover up to 12 months
 of supply for goods. Financial derivatives to hedge or lock in
the prices of these commodities over the long term (greater than
one year) generally are not available.

We do utilize financial derivatives to fix the price of the raw
material component of the cardboard boxes and packaging we use in
 our business. Our purchase contracts with our cardboard box
suppliers have provisions that allow the raw material component
of the box price to reset based on movements in the price of
cardboard. This component is based on the Pulp & Paper
Week42 lb. linerboard price index. We have entered into a
series of contracts for 2000 covering a notional amount of 30,000
 tons that allow us to pay a weighted average fixed price per ton
 of cardboard of $435.00 and receive payments based on the Pulp & Paper Weekindex. At December 31, 1999, the
Pulp & Paper Week index price was $425/ton. Open
contracts had a fair market loss associated with them of
approximately $175,000.

Employee Benefit Plan Expense

We offer our directors and management deferred compensation
plans. Under these plans, participants can defer a portion of
their compensation into Dial stock units. Deferred compensation
due to participants and any accumulated investment gains or
losses is included on the balance sheet as a liability under the
caption Pension and other benefits. We place
the deferred funds in a Rabbi Trust, which purchases life
insurance policies on the participants lives, with Dial as
the beneficiary. The policies have a cash surrender value that
accrue tax-free earnings based on the performance of the S&P
500. The cash surrender value asset and any accumulated
investment gains or losses is included on the balance sheet as an
 asset under the caption Other assets. To the
extent that the return on Dial shares is different from that of
the S&P 500, income or expense is generated by the plans.

We have entered into a contract with a financial institution that
 provides for an exchange of payments based on the relative
performance of our common shares and the S&P 500. The
contract has a notional amount of 244,000 Dial common shares and
5,200 S&P 500 futures contracts and is renewable quarterly.
At the time of renewal, the index price of Dial shares and the
S&P 500 resets to the current market price. Any income or
loss generated by the contract is recognized in the income
statement and offsets the income statement impact of the deferred
 compensation plan. Because the contract renews near the end of
each quarter, its market value at the end of each quarter (and
accordingly, at December 31, 1999) approximates zero.

Item 8.  Financial Statements and
Supplementary Data

Our consolidated financial statements as of December 31,
1999, and for each of the fiscal years in the three-year period
ended December 31, 1999, together with related notes and the
 report of Deloitte & Touche LLP are set forth on the
following pages.

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MANAGEMENTS REPORT ON RESPONSIBILITY FOR FINANCIAL
REPORTING

The management of The Dial Corporation has the responsibility for
 preparing and assuring the integrity and objectivity of the
accompanying financial statements and other financial information
 in this report. The financial statements were prepared using
generally accepted accounting principles consistently applied.
The financial statements reflect, where applicable,
managements best estimates and judgments and include
disclosures and explanations that are relevant to an
understanding of our financial affairs.

Our financial statements have been audited by Deloitte &
Touche LLP. Management has made available to Deloitte &
Touche LLP all of our financial records and other relevant
data and has made appropriate and complete written and oral
representations and disclosures in connection with the audit.

Management has established and maintains a system of internal
control that is designed to provide reasonable assurance that
transactions are authorized and properly recorded, that assets
are protected and that materially inaccurate financial reporting
is prevented and detected. The appropriate segregation of
responsibilities and careful selection of employees are
components of the system of internal controls. The internal
control system is independently monitored and evaluated by an
extensive and comprehensive internal auditing program.

The Board of Directors, acting through its Audit Committee,
oversees the adequacy of the Companys internal control
environment. The Audit Committee meets regularly with management
representatives and, jointly and separately, with representatives
 of Deloitte & Touche LLP and internal auditing
management to review accounting, auditing and financial reporting
 matters.



| |                                                   
| | --------------------------------------------------
| | /s/ MALCOLM JOZOFF                                
| |                                                   
| | Malcolm Jozoff                                    
| | Chairman, President & Chief Executive Officer     
|
| | /s/ SUSAN J. RILEY                                
| |                                                   
| | Susan J. Riley                                    
| | Executive Vice President & Chief Financial Officer

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INDEPENDENT AUDITORS REPORT

To the Stockholders and Board of



We have audited the accompanying consolidated balance sheets of
The Dial Corporation as of December 31, 1999, and 1998, and
the related consolidated statements of operations and
comprehensive income, cash flows and stockholders equity
for each of the three fiscal years in the period ended
December 31, 1999. These financial statements are the
responsibility of the Companys management. Our
responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with auditing standards
generally accepted in the United States of America. Those
standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
 presentation. We believe that our audits provide a reasonable
basis for our opinion.

In our opinion, such consolidated financial statements present
fairly, in all material respects, the financial position of The
Dial Corporation as of December 31, 1999, and 1998, and the
results of its operations and its cash flows for each of the
three fiscal years in the period ended December 31, 1999, in
 conformity with accounting principles generally accepted in the
United States of America.



| |                           
| | --------------------------
| | /s/  DELOITTE & TOUCHE LLP
| |                           
| | Deloitte & Touche LLP     

Phoenix, Arizona



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THE DIAL CORPORATION

CONSOLIDATED BALANCE SHEET

(as of December 31, in thousands)


|                                     |                                                                                                         |                            |           |          |         |   |           |          |         | 
|------------------------------------ | ------------------------------------------------------------------------------------------------------- | -------------------------- | --------- | -------- | ------- | - | --------- | -------- | ------- | 
|                                     |                                                                                                         | 1999                       |           | 1998    
|                                     |                                                                                                         |                            |           |         
|ASSETS                               |                                                                                                         |                            |           |          |         |   |           |         
|                                    
|                                    
|                                    
|                                    
|Current Assets:                      |                                                                                                         |                            |           |          |         |   |           |         
|                                    
|                                    
|                                    
|                                    
|                                     | Cash and cash equivalents                                                                               |                            | $         | 6,126    |         |   | $         | 12,405   |        
|                                    
|                                    
|                                    
|                                    
|                                     | Receivables, less allowance of $7,994 and $7,378                                                        |                            |           | 107,413  |         |   |           | 56,477   |        
|                                    
|                                    
|                                    
|                                    
|                                     | Inventories                                                                                             |                            |           | 180,744  |         |   |           | 155,441  |        
|                                    
|                                    
|                                    
|                                    
|                                     | Deferred income taxes                                                                                   |                            |           | 17,852   |         |   |           | 13,156   |        
|                                    
|                                    
|                                    
|                                    
|                                     | Other current assets                                                                                    |                            |           | 20,369   |         |   |           | 1,634    |        
|                                     |                                                                                                         |                            |           |          |         |   |           |         
|                                     |                                                                                                         | Total current assets       |           |          | 332,504 |   |           |          | 239,113 | 
|                                    
|                                    
|                                    
|                                    
|Property and equipment, net          |                                                                                                         |                            | 306,585   |          |         |   | 281,302   |         
|                                    
|                                    
|                                    
|                                    
|Deferred income taxes                |                                                                                                         |                            | 65,200    |          |         |   | 82,227    |         
|                                    
|                                    
|                                    
|                                    
|Intangibles, net                     |                                                                                                         |                            | 524,745   |          |         |   | 545,999   |         
|                                    
|                                    
|                                    
|                                    
|Other assets                         |                                                                                                         |                            | 40,652    |          |         |   | 26,734    |         
|                                     |                                                                                                         |                            |           |          |         |   |           |         
|                                     |                                                                                                         | $                          | 1,269,686 |          |         | $ | 1,175,375 |         
|                                     |                                                                                                         |                            |           |          |         |   |           |         
|LIABILITIES AND STOCKHOLDERS EQUITY |                                                                                                         |                            |           |          |         |   |           |         
|                                    
|                                    
|                                    
|                                    
|Current Liabilities:                 |                                                                                                         |                            |           |          |         |   |           |         
|                                    
|                                    
|                                    
|                                    
|                                     | Trade accounts payable                                                                                  |                            | $         | 128,320  |         |   | $         | 123,911  |        
|                                    
|                                    
|                                    
|                                    
|                                     | Short-term borrowings                                                                                   |                            |           | 60,163   |         |   |           | 10,389   |        
|                                    
|                                    
|                                    
|                                    
|                                     | Income taxes payable                                                                                    |                            |           | 29,931   |         |   |           | 9,685    |        
|                                    
|                                    
|                                    
|                                    
|                                     | Other current liabilities                                                                               |                            |           | 99,600   |         |   |           | 106,663  |        
|                                     |                                                                                                         |                            |           |          |         |   |           |         
|                                     |                                                                                                         | Total current liabilities  |           |          | 318,014 |   |           |          | 250,648 | 
|                                    
|                                    
|                                    
|                                    
|Long-term debt                       |                                                                                                         |                            | 300,951   |          |         |   | 280,223   |         
|                                    
|                                    
|                                    
|                                    
|Pension and other benefits           |                                                                                                         |                            | 232,586   |          |         |   | 245,981   |         
|                                    
|                                    
|                                    
|                                    
|Other liabilities                    |                                                                                                         |                            | 6,864     |          |         |   | 8,298     |         
|                                     |                                                                                                         |                            |           |          |         |   |           |         
|                                     |                                                                                                         | Total liabilities          |           |          | 858,415 |   |           |          | 785,150 | 
|                                     |                                                                                                         |                            |           |          |         |   |           |         
|Commitments and contingencies        |                                                                                                         |                            |          |          |         |   |          |         
|                                    
|                                    
|                                    
|                                    
|Stockholders Equity:                |                                                                                                         |                            |           |          |         |   |           |         
|                                    
|                                    
|                                    
|                                    
|                                     | Preferred stock, $.01 par value, 10,000,000 shares authorized; no
	 shares issued and outstanding       |                            |           |         |         |   |           |         |        
|                                    
|                                    
|                                    
|                                    
|                                     | Common stock, $.01 par value, 300,000,000 shares authorized;
	105,480,645 and 104,355,018 shares issued |                            |           | 1,055    |         |   |           | 1,044    |        
|                                    
|                                    
|                                    
|                                    
|                                     | Additional capital                                                                                      |                            |           | 448,977  |         |   |           | 450,767  |        
|                                    
|                                    
|                                    
|                                    
|                                     | Retained income                                                                                         |                            |           | 190,370  |         |   |           | 105,011  |        
|                                    
|                                    
|                                    
|                                    
|                                     | Accumulated other comprehensive income                                                                  |                            |           | (2,851   | )       |   |           | (8,949   | )      
|                                    
|                                    
|                                    
|                                    
|                                     | Employee benefits                                                                                       |                            |           | (95,802  | )       |   |           | (129,111 | )      
|                                    
|                                    
|                                    
|                                    
|                                     | Treasury stock, 4,887,176 and 1,176,082 shares held                                                     |                            |           | (130,478 | )       |   |           | (28,537  | )      
|                                     |                                                                                                         |                            |           |          |         |   |           |         
|                                     |                                                                                                         | Total stockholders equity |           |          | 411,271 |   |           |          | 390,225 | 
|                                     |                                                                                                         |                            |           |          |         |   |           |         
|                                     |                                                                                                         | $                          | 1,269,686 |          |         | $ | 1,175,375 |         
|                                     |                                                                                                         |                            |           |          |         |   |           |         

See Notes to Consolidated Financial Statements.

22



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##### Table of Contents



THE DIAL CORPORATION

STATEMENT OF CONSOLIDATED OPERATIONS AND COMPREHENSIVE INCOME

(in thousands, except per share data)


|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |         |        |  
|--------------------------------------------- | -------------------------------------------- | --------------------------------------- | --------- | ------------ | ----- | ---------- | --------- | ------- | ------ | - | --------- | ------- | ------ | -
|                                              |                                              |                                        
|                                              |                                              | Fiscal Year Ended                      
|                                              |                                              |                                        
|                                              |                                              | December 31,                            |           | December 31, |       | January 3,
|                                              |                                              | 1999                                    |           | 1998         |       | 1998      
|                                              |                                              |                                         |           |              |       |           
|Net sales                                     |                                              | $                                       | 1,721,566 |              |       | $          | 1,524,517 |         |        | $ | 1,362,606 |        
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|Costs and expenses:                           |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|                                             
|                                             
|                                             
|                                             
|                                              | Cost of products sold                        |                                         |           | 860,811      |       |            |           | 787,401 |        |   |           | 718,112 |       
|                                             
|                                             
|                                             
|                                             
|                                              | Selling, general and administrative expenses |                                         |           | 645,613      |       |            |           | 553,181 |        |   |           | 482,324 |       
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|                                              |                                              |                                         | 1,506,424 |              |       |            | 1,340,582 |         |        |   | 1,200,436 |        
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|Operating income                              |                                              |                                         | 215,142   |              |       |            | 183,935   |         |        |   | 162,170   |        
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|Interest and other expenses                   |                                              |                                         | 32,712    |              |       |            | 23,358    |         |        |   | 28,235    |        
|                                             
|                                             
|                                             
|                                             
|Net earnings (loss) of joint venture          |                                              |                                         | (1,347    | )            |       |            |           |         |        |   |           |        
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|                                              |                                              |                                         | 34,059    |              |       |            | 23,358    |         |        |   | 28,235    |        
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|Income before income taxes                    |                                              |                                         | 181,083   |              |       |            | 160,577   |         |        |   | 133,935   |        
|                                             
|                                             
|                                             
|                                             
|Income taxes                                  |                                              |                                         | 64,317    |              |       |            | 57,961    |         |        |   | 50,225    |        
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|NET INCOME                                    |                                              | $                                       | 116,766   |              |       | $          | 102,616   |         |        | $ | 83,710    |        
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|NET INCOME PER SHARE  BASIC                  |                                              | $                                       | 1.19      |              |       | $          | 1.04      |         |        | $ | 0.91      |        
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|NET INCOME PER SHARE  DILUTED                |                                              | $                                       | 1.17      |              |       | $          | 1.02      |         |        | $ | 0.89      |        
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|Basic shares outstanding                      |                                              |                                         | 98,255    |              |       |            | 98,294    |         |        |   | 91,918    |        
|                                             
|                                             
|                                             
|                                             
|                                              | Equivalent shares                            |                                         |           | 1,810        |       |            |           | 2,185   |        |   |           | 2,231   |       
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|Diluted shares outstanding                    |                                              |                                         | 100,065   |              |       |            | 100,479   |         |        |   | 94,149    |        
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|                                             
|NET INCOME                                    |                                              | $                                       | 116,766   |              |       | $          | 102,616   |         |        | $ | 83,710    |        
|                                             
|                                             
|                                             
|                                             
|Other comprehensive income (loss) net of tax: |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|                                             
|                                             
|                                             
|                                             
|                                              |                                              | Foreign currency translation adjustment |           |              | 295   |            |           |         | (524   | ) |           |         | (2,263 | )
|                                             
|                                             
|                                             
|                                             
|                                              |                                              | Minimum pension liability adjustment    |           |              | 5,803 |            |           |         | (6,625 | ) |           |         | 3,600  |  
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|Other comprehensive income (loss)             |                                              |                                         | 6,098     |              |       |            | (7,149    | )       |        |   | 1,337     |        
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        
|COMPREHENSIVE INCOME                          |                                              | $                                       | 122,864   |              |       | $          | 95,467    |         |        | $ | 85,047    |        
|                                              |                                              |                                         |           |              |       |            |           |         |        |   |           |        

See Notes to Consolidated Financial Statements.

23



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##### Table of Contents



THE DIAL CORPORATION

STATEMENT OF CONSOLIDATED CASH FLOWS

(in thousands)


|                                                                                   |                                             |                                   |          |              |         |            |          |        |         |   |          |        |         |  
|---------------------------------------------------------------------------------- | ------------------------------------------- | --------------------------------- | -------- | ------------ | ------- | ---------- | -------- | ------ | ------- | - | -------- | ------ | ------- | -
|                                                                                   |                                             |                                  
|                                                                                   |                                             | Fiscal Year Ended                
|                                                                                   |                                             |                                  
|                                                                                   |                                             | December 31,                      |          | December 31, |         | January 3,
|                                                                                   |                                             | 1999                              |          | 1998         |         | 1998      
|                                                                                   |                                             |                                   |          |              |         |           
|CASH FLOWS PROVIDED (USED) BY OPERATING                                            |                                             |                                   |          |              |         |            |          |        |         |   |          |       
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   |                                             | ACTIVITIES:                       |          |              |         |            |          |        |         |   |          |        |         |  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Net income                                                                         |                                             | $                                 | 116,766  |              |         | $          | 102,616  |        |         | $ | 83,710   |       
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Adjustments to reconcile net income to net cash provided by
	operating activities: |                                             |                                   |          |              |         |            |          |        |         |   |          |       
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   | Depreciation and amortization               |                                   |          | 43,130       |         |            |          | 36,489 |         |   |          | 31,763 |        
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   | Deferred income taxes                       |                                   |          | 10,321       |         |            |          | 33,235 |         |   |          | 36,545 |        
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   | Change in operating assets and liabilities: |                                   |          |              |         |            |          |        |         |   |          |        |        
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   |                                             | Receivables                       |          |              | (34,111 | )          |          |        | (29,152 | ) |          |        | 9,894   |  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   |                                             | Inventories                       |          |              | (23,640 | )          |          |        | 8,651   |   |          |        | 17,815  |  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   |                                             | Trade accounts payable            |          |              | 4,547   |            |          |        | 2,440   |   |          |        | (3,457  | )
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   |                                             | Other assets and liabilities, net |          |              | 4,754   |            |          |        | (32,004 | ) |          |        | (15,422 | )
|                                                                                   |                                             |                                   |          |              |         |            |          |        |         |   |          |       
|Net cash provided by operating activities                                          |                                             |                                   | 121,767  |              |         |            | 122,275  |        |         |   | 160,848  |       
|                                                                                   |                                             |                                   |          |              |         |            |          |        |         |   |          |       
|CASH FLOWS PROVIDED (USED) BY INVESTING ACTIVITIES:                                |                                             |                                   |          |              |         |            |          |        |         |   |          |       
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Capital expenditures                                                               |                                             |                                   | (62,495  | )            |         |            | (50,330  | )      |         |   | (46,715  | )     
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Investment in and loans to joint venture                                           |                                             |                                   | (11,811  | )            |         |            |          |        |         |   |          |       
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Acquisition of business, net of cash acquired                                      |                                             |                                   | 6,046    |              |         |            | (271,043 | )      |         |   | (31,575  | )     
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Proceeds from sales of property and equipment                                      |                                             |                                   |          |              |         |            | 10,662   |        |         |   | 35,853   |       
|                                                                                   |                                             |                                   |          |              |         |            |          |        |         |   |          |       
|Net cash used by investing activities                                              |                                             |                                   | (68,260  | )            |         |            | (310,711 | )      |         |   | (42,437  | )     
|                                                                                   |                                             |                                   |          |              |         |            |          |        |         |   |          |       
|CASH FLOWS PROVIDED (USED) BY FINANCING ACTIVITIES:                                |                                             |                                   |          |              |         |            |          |        |         |   |          |       
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Net change in long-term borrowings                                                 |                                             |                                   | 20,728   |              |         |            | 190,300  |        |         |   | (206,216 | )     
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Common stock purchased for treasury                                                |                                             |                                   | (100,216 | )            |         |            | (26,166  | )      |         |   |          |       
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Proceeds from sale of common stock                                                 |                                             |                                   |          |              |         |            |          |        |         |   | 107,990  |       
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Net change in short-term bank loans                                                |                                             |                                   | 49,774   |              |         |            | 1,889    |        |         |   | 8,500    |       
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Dividends paid on common stock                                                     |                                             |                                   | (31,407  | )            |         |            | (31,497  | )      |         |   | (29,510  | )     
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Cash proceeds from stock options                                                   |                                             |                                   | 18,158   |              |         |            | 25,126   |        |         |   | 12,810   |       
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Net change in receivables sold                                                     |                                             |                                   | (16,823  | )            |         |            | 31,100   |        |         |   | (15,998  | )     
|                                                                                   |                                             |                                   |          |              |         |            |          |        |         |   |          |       
|Net cash provided (used) by financing activities                                   |                                             |                                   | (59,786  | )            |         |            | 190,752  |        |         |   | (122,424 | )     
|                                                                                   |                                             |                                   |          |              |         |            |          |        |         |   |          |       
|Net increase (decrease) in cash and cash equivalents                               |                                             |                                   | (6,279   | )            |         |            | 2,316    |        |         |   | (4,013   | )     
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Cash and cash equivalents, beginning of year                                       |                                             |                                   | 12,405   |              |         |            | 10,089   |        |         |   | 14,102   |       
|                                                                                   |                                             |                                   |          |              |         |            |          |        |         |   |          |       
|CASH AND CASH EQUIVALENTS, END OF YEAR                                             |                                             | $                                 | 6,126    |              |         | $          | 12,405   |        |         | $ | 10,089   |       
|                                                                                   |                                             |                                   |          |              |         |            |          |        |         |   |          |       

See Notes to Consolidated Financial Statements.

24



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##### Table of Contents



THE DIAL CORPORATION

STATEMENT OF CONSOLIDATED STOCKHOLDERS EQUITY

(in thousands)


|                           |                                      |              |         |            |  |          |       |           |  |          |         |               |   |        |         |         |   |   |          |         |   |   |          |          |   |   |        |        |   |   |         |          |  
|-------------------------- | ------------------------------------ | ------------ | ------- | ---------- |  | -------- | ----- | --------- |  | -------- | ------- | ------------- | - | ------ | ------- | ------- | - | - | -------- | ------- | - | - | -------- | -------- | - | - | ------ | ------ | - | - | ------- | -------- | -
|                           |                                      |              |         |            |  |          |       |           |  |          |         | Accumulated   |   |       
|                           |                                      | Common Stock |         |            |  | Retained |       |           |  | Common   |         | Other         |   |       
|                           |                                      |              |         | Additional |  | Income   |       | Employee  |  | Stock in |         | Comprehensive |   |       
|                           |                                      | Shares       |         | Amount     |  | Capital  |       | (Deficit) |  | Benefits |         | Treasury      |   | Income |         | Total  
|                           |                                      |              |         |            |  |          |       |           |  |          |         |               |   |        |         |        
|Balance, December 28, 1996 |                                      |              | 95,639  |            |  | $        | 956   |           |  | $        | 247,209 |               |   | $      | (20,308 | )       |   | $ | (83,417  | )       |   | $ | (646     | )        |   | $ | (3,137 | )      |   | $ | 140,657 |         
|                          
|                          
|                          
|                          
|                           | Exercise of stock options            |              |         | 807        |  |          |       | 8         |  |          |         | 5,884         |   |        |         |         |   |   |          | 10,009  |   |   |          | (715     | ) |   |        |        |   |   |         | 15,186   |  
|                          
|                          
|                          
|                          
|                           | Net proceeds from stock
	offering    |              |         | 6,279      |  |          |       | 63        |  |          |         | 107,927       |   |        |         |         |   |   |          |         |   |   |          |          |   |   |        |        |   |   |         | 107,990  |  
|                          
|                          
|                          
|                          
|                           | Dividends on common stock            |              |         |            |  |          |       |           |  |          |         |               |   |        |         | (29,510 | ) |   |          |         |   |   |          |          |   |   |        |        |   |   |         | (29,510  | )
|                          
|                          
|                          
|                          
|                           | Change in unearned employee benefits |              |         |            |  |          |       |           |  |          |         | 32,927        |   |        |         |         |   |   |          | (32,164 | ) |   |          | (87      | ) |   |        |        |   |   |         | 676      |  
|                          
|                          
|                          
|                          
|                           | Net income                           |              |         |            |  |          |       |           |  |          |         |               |   |        |         | 83,710  |   |   |          |         |   |   |          |          |   |   |        |        |   |   |         | 83,710   |  
|                          
|                          
|                          
|                          
|                           | Other comprehensive income           |              |         |            |  |          |       |           |  |          |         |               |   |        |         |         |   |   |          |         |   |   |          |          |   |   |        | 1,337  |   |   |         | 1,337    |  
|                           |                                      |              |         |            |  |          |       |           |  |          |         |               |   |        |         |         |   |   |          |         |   |   |          |          |   |   |        |        |   |   |         |         
|Balance, January 3, 1998   |                                      |              | 102,725 |            |  |          | 1,027 |           |  |          | 393,947 |               |   |        | 33,892  |         |   |   | (105,572 | )       |   |   | (1,448   | )        |   |   | (1,800 | )      |   |   | 320,046 |         
|                          
|                          
|                          
|                          
|                           | Exercise of stock options            |              |         | 1,630      |  |          |       | 17        |  |          |         | 18,963        |   |        |         |         |   |   |          | 13,158  |   |   |          | (923     | ) |   |        |        |   |   |         | 31,215   |  
|                          
|                          
|                          
|                          
|                           | Common stock purchased for treasury  |              |         |            |  |          |       |           |  |          |         |               |   |        |         |         |   |   |          |         |   |   |          | (26,166  | ) |   |        |        |   |   |         | (26,166  | )
|                          
|                          
|                          
|                          
|                           | Dividends on common stock            |              |         |            |  |          |       |           |  |          |         |               |   |        |         | (31,497 | ) |   |          |         |   |   |          |          |   |   |        |        |   |   |         | (31,497  | )
|                          
|                          
|                          
|                          
|                           | Change in employee benefits          |              |         |            |  |          |       |           |  |          |         | 37,857        |   |        |         |         |   |   |          | (36,697 | ) |   |          |          |   |   |        |        |   |   |         | 1,160    |  
|                          
|                          
|                          
|                          
|                           | Net income                           |              |         |            |  |          |       |           |  |          |         |               |   |        |         | 102,616 |   |   |          |         |   |   |          |          |   |   |        |        |   |   |         | 102,616  |  
|                          
|                          
|                          
|                          
|                           | Other comprehensive income           |              |         |            |  |          |       |           |  |          |         |               |   |        |         |         |   |   |          |         |   |   |          |          |   |   |        | (7,149 | ) |   |         | (7,149   | )
|                           |                                      |              |         |            |  |          |       |           |  |          |         |               |   |        |         |         |   |   |          |         |   |   |          |          |   |   |        |        |   |   |         |         
|Balance, December 31, 1998 |                                      |              | 104,355 |            |  |          | 1,044 |           |  |          | 450,767 |               |   |        | 105,011 |         |   |   | (129,111 | )       |   |   | (28,537  | )        |   |   | (8,949 | )      |   |   | 390,225 |         
|                          
|                          
|                          
|                          
|                           | Exercise of stock options            |              |         | 1,007      |  |          |       | 10        |  |          |         | 13,269        |   |        |         |         |   |   |          | 15,662  |   |   |          | (1,469   | ) |   |        |        |   |   |         | 27,472   |  
|                          
|                          
|                          
|                          
|                           | Common stock purchased for treasury  |              |         |            |  |          |       |           |  |          |         |               |   |        |         |         |   |   |          |         |   |   |          | (100,216 | ) |   |        |        |   |   |         | (100,216 | )
|                          
|                          
|                          
|                          
|                           | Dividends on common stock            |              |         |            |  |          |       |           |  |          |         |               |   |        |         | (31,407 | ) |   |          |         |   |   |          |          |   |   |        |        |   |   |         | (31,407  | )
|                          
|                          
|                          
|                          
|                           | Change in employee benefits          |              |         | 119        |  |          |       | 1         |  |          |         | (15,059       | ) |        |         |         |   |   |          | 17,647  |   |   |          | (256     | ) |   |        |        |   |   |         | 2,333    |  
|                          
|                          
|                          
|                          
|                           | Net income                           |              |         |            |  |          |       |           |  |          |         |               |   |        |         | 116,766 |   |   |          |         |   |   |          |          |   |   |        |        |   |   |         | 116,766  |  
|                          
|                          
|                          
|                          
|                           | Other comprehensive income           |              |         |            |  |          |       |           |  |          |         |               |   |        |         |         |   |   |          |         |   |   |          |          |   |   |        | 6,098  |   |   |         | 6,098    |  
|                           |                                      |              |         |            |  |          |       |           |  |          |         |               |   |        |         |         |   |   |          |         |   |   |          |          |   |   |        |        |   |   |         |         
|Balance, December 31, 1999 |                                      |              | 105,481 |            |  | $        | 1,055 |           |  | $        | 448,977 |               |   | $      | 190,370 |         |   | $ | (95,802  | )       |   | $ | (130,478 | )        |   | $ | (2,851 | )      |   | $ | 411,271 |         
|                           |                                      |              |         |            |  |          |       |           |  |          |         |               |   |        |         |         |   |   |          |         |   |   |          |          |   |   |        |        |   |   |         |         

See Notes to Consolidated Financial Statements.

25



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Fiscal Years ended December 31, 1999, December 31, 1998,


and January 3, 1998


Note 1.  Nature of Business

We manufacture and sell consumer products. We market our products
 primarily under such well-known household brand names as Dial® soaps, Purex® detergents,
Renuzit® air fresheners and Armour® canned meats. We also market specialty personal care
products under the brand names Freeman®, Sarah Michaels® and Natures
Accents®. These products are sold to consumers
primarily though supermarkets, mass merchandisers, drug stores,
membership club stores and other outlets. We do approximately 90%
 of our business in the United States.

Prior to August 1996, we operated as the consumer products
business of Viad Corp. Viad, our former parent, was then known as
 The Dial Corp. In August 1996, former parent declared a dividend
 and distributed to its stockholders all the outstanding common
stock causing us to become a separately publicly traded company.
This transaction is known as the Spin-off. We have operated as
The Dial Corporation since the Spin-off.

Note 2.  Significant Accounting Policies

Principles of Consolidation. The accompanying consolidated
 financial statements include the accounts of The Dial
Corporation and all majority-owned subsidiaries. We account for
our investment in the Dial/ Henkel LLC joint venture under the
equity method of accounting. All material intercompany
transactions and profits have been eliminated in consolidation.

Beginning with 1998, our fiscal year end was December 31.
Prior to 1998, the Companys fiscal year ended on the
Saturday closest to the end of December. Fiscal years 1999 and
1998 consisted of 52 weeks while fiscal year 1997 consisted
of 53 weeks.

Use of Estimates.The Consolidated Financial Statements
are prepared in accordance with generally accepted accounting
principles, which require management to make estimates and
assumptions that affect the reported amounts of assets and
liabilities and disclosures at the date of the financial
statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from
those estimates.

Revenue Recognition.Sales are recorded at the time
products are shipped to trade customers.

Major Customers.Major customers are defined as those that
 individually accounted for more than 10% of our net sales. Sales
 to Wal-Mart accounted for 18%, 17% and 17% of our net sales in
1999, 1998 and 1997.

Marketing and Research and Development Costs.All
expenditures for marketing and research and development are
charged against earnings in the year incurred and are reported in
 the Statement of Consolidated Operations under the caption
Selling, general and administrative expenses. Our
internal and external research and development expenditures
totaled approximately $11.7 million, $10.1 million and
$10.1 million in 1999, 1998 and 1997. Marketing costs
include the costs of advertising and various sales promotional
programs.

Cash and Cash Equivalents.We consider all highly liquid
investments with original maturities of three months or less from
 the date of purchase to be cash equivalents.

Inventories.Generally, inventories are stated at the
lower of cost (first in, first out and average cost methods) or
market.

Long-Lived Assets.We review the carrying values of our
long-lived assets and identifiable intangibles for possible
impairment whenever events or changes in circumstances indicate
that the carrying amount of assets to be held and used may not be
 recoverable. For assets to be disposed of, we report long-lived
assets and certain identifiable intangibles at the lower of
carrying amount or fair value less cost to sell.

26



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


Property and Equipment.Property and equipment are stated
at cost, net of accumulated depreciation. Depreciation is
provided principally by use of the straight-line method at annual
 rates as follows:

|                              |  |                                    
|----------------------------- |  | -----------------------------------
|                             
|                             
|                             
|                             
|Buildings                     |  | 2% to 5%                           
|                             
|                             
|                             
|                             
|Machinery and other equipment |  | 5% to 33%                          
|                             
|                             
|                             
|                             
|Leasehold improvements        |  | Lesser of lease term or useful life

Intangibles.Intangibles are carried at cost less
accumulated amortization. Intangibles that arose prior to
November 1, 1970, are not being amortized. Goodwill arising
on or after November 1, 1970, is amortized on the
straight-line method over the periods of expected benefit but not
 in excess of 40 years. Purchased trademarks are amortized
on the straight-line method over 40 years. The customer list
 that arose from the acquisition of Purex® is
being amortized over 30 years. Separately identifiable costs
 incurred to maintain and/or renew trademarks and patents are
capitalized and amortized over the life of the trademark or
patent, which is 10 and 17 years, respectively.

Net Income Per Common Share.Basic net income per common
share is computed by dividing net income by the weighted average
number of common shares outstanding during the year before giving
 effect to stock options considered to be dilutive common stock
equivalents. Diluted net income per common share is computed by
dividing net income by the weighted average number of common
shares outstanding during the year after giving effect to stock
options considered to be dilutive common stock equivalents.
Shares held by the Employee Equity Trust are not considered
outstanding for net income per share calculations until the
shares are released from the Trust and transferred to an employee
 or transferred on behalf of an employee.

At December 31, 1999, there were 105,480,645 shares of
common stock issued and 96,653,798 shares outstanding. At
December 31, 1999, and December 31, 1998, a total of
3,939,671 and 4,495,736, respectively, of the issued shares were
held by the Employee Equity Trust. At December 31, 1999, and
 December 31, 1998, a total of 4,887,176 and 1,176,082
shares of common stock, respectively, were held in treasury. The
shares held at December 31, 1999, included 218,725 shares
valued at $5.2 million purchased as part of a small
shareholder selling/repurchasing program and 4,476,604 shares
valued at $121.3 million, purchased as part of our stock
repurchase program.

In addition to common stock, we are authorized to issue
10,000,000 shares of preferred stock, par value of $.01 per
share, none of which has been issued.

New Accounting Pronouncements.The Financial Accounting
Standards Board has issued Statement of Financial Accounting
Standards No. 133 Accounting for Derivative
Instruments and Hedging Activities. We will be required to
adopt this new standard in the first quarter of 2001. This
statement requires that all derivatives be recorded in the
balance sheet as either an asset or liability measured at fair
value. The statement requires that changes in a derivatives
 fair value be recognized currently in earnings unless specific
hedge accounting criteria are met. We are still in the process of
 evaluating this statement and the impact on our consolidated
financial statements.

Derivative Financial Instruments.Our use of financial
instruments is limited to purposes other than trading and
primarily includes management of employee benefits and commodity
expense. These instruments qualify for hedge accounting. The
financial impacts of these hedging instruments are offset in part
 or in whole by corresponding changes in the underlying exposures
 being hedged.

Reclassifications.Certain reclassifications of prior
years amounts have been made to conform with the current
year presentation.

Note 3.  Acquisition of Businesses

On July 1, 1998, we acquired The Freeman Cosmetic
Corporation (Freeman), a manufacturer and marketer of
 natural skin care, hair care, bath, body and foot care products
for a cash purchase price of approximately $78.0 million.
The cash purchase price for Freeman reflects a $6.0 million
reduction as a result

27



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


of a net worth adjustment received by the Company in
January 1999. The Freeman acquisition has been accounted for
 under the purchase method of accounting. The purchase price has
been allocated based on estimated fair value of assets and
liabilities at date of acquisition. This allocation added
$9.0 million to current assets, $25.3 million to
current liabilities and has resulted in acquired goodwill of
$87.2 million, which is being amortized on a straight-line
basis over 40 years. The results of Freeman have been
included in the consolidated financial statements since the
acquisition date.

On September 14, 1998, we acquired Sarah Michaels, Inc.
(Sarah Michaels), a manufacturer and marketer of
specialty bath and body care products for a cash purchase price
of $187.0 million. The Sarah Michaels acquisition has been
accounted for under the purchase method of accounting. The
purchase price has been allocated based on estimated fair value
of assets and liabilities at date of acquisition. At
December 31, 1999, $5.0 million remains in escrow
pending final valuation of certain acquired assets and
liabilities. This allocation added $42.9 million to current
assets, $15.8 million to current liabilities and has
resulted in acquired goodwill of approximately
$122.5 million, which is being amortized on a straight-line
basis over 40 years. The results of Sarah Michaels have been
 included in the consolidated financial statements since the
acquisition date.

The following unaudited pro forma combined condensed financial
information for 1998 and 1997 includes our results of operations
and assumes the acquisition of Sarah Michaels and Freeman were
consummated at the beginning of each period presented, along with
 adjustments which give effect to events that are directly
attributable to the transaction and are expected to have a
continuing impact. The unaudited pro forma combined condensed
financial information does not give any effect to any potential
cost savings which may arise from the consolidation of the
acquisitions with our results.

The unaudited pro forma combined condensed financial information
does not purport to represent the results of operations that
would have actually resulted had the purchases occurred on the
indicated dates, nor should it be taken as indicative of future
results of operations.

|                             |  |                       |           |            |  |   |           | 
|---------------------------- |  | --------------------- | --------- | ---------- |  | - | --------- | 
|                             |  | December 31,          |           | January 3,
|                             |  | 1998                  |           | 1998      
|                             |  |                       |           |           
|                             |  |                      
|                             |  | (in thousands, except
|                             |  | per share data)      
|                            
|                            
|                            
|                            
|Net sales                    |  | $                     | 1,580,286 |            |  | $ | 1,496,058 | 
|                            
|                            
|                            
|                            
|Operating income             |  |                       | 181,534   |            |  |   | 177,391   | 
|                            
|                            
|                            
|                            
|Net income                   |  |                       | 94,474    |            |  |   | 83,284    | 
|                            
|                            
|                            
|                            
|Earnings per share  diluted |  | $                     | 0.94      |            |  | $ | 0.88      | 

In September 1997, the Company acquired Nuevo Federal S.A.,
a manufacturer and marketer of personal care and household
products in Argentina, for a purchase price of approximately
$35 million. Of this amount, $26.8 million was paid in
cash with the remainder of the purchase price comprised of future
 payments contingent on the completion of certain transactions
which have not yet occurred. In addition, in November 1997,
the Company acquired three leading personal care soap brands and
two laundry bar brands from The Procter & Gamble
Companys Argentinean subsidiary for a purchase price of
$4.8 million paid in cash. These acquisitions, accounted for
 under the purchase method of accounting, resulted in acquired
goodwill of approximately $27.6 million which is being
amortized on a straight-line basis over 25 years.

Note 4.  Dial/ Henkel Joint Venture

In April 1999, we formed Dial/ Henkel LLC, a joint venture
with Henkel KGaA of Düsseldorf, Germany. Dial and Henkel
each own 50% of this joint venture. The joint venture was formed
to develop and market a range of enhanced laundry products in
North America. In July 1999, the joint venture acquired the
Custom Cleaner home dry-cleaning business.

28



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


We account for our investment under the equity method of
accounting. The joint ventures results of operations and
our equity in net loss of the joint venture included:

|                               |  |                    |        |  
|------------------------------ |  | ------------------ | ------ | -
|                               |  | For the period    
|                               |  | ended December 31,
|                               |  | 1999              
|                               |  |                   
|                               |  | (in thousands)    
|                              
|                              
|                              
|                              
|Joint Venture                  |  |                    |        |  
|                              
|                              
|                              
|                              
|Net sales                      |  | $                  | 10,679 |  
|                              
|                              
|                              
|                              
|Loss before income taxes       |  |                    | (5,092 | )
|                              
|                              
|                              
|                              
|Net loss                       |  | $                  | (4,649 | )
|                              
|                              
|                              
|                              
|Dial Equity in Earnings (Loss) |  |                    |        |  
|                              
|                              
|                              
|                              
|Dial equity in net loss        |  | $                  | (1,347 | )

The joint venture agreement provides for a monthly marketing,
sales and administrative fee, a trademark fee, and a tolling fee
to be paid to us. A monthly technology fee is paid to Henkel.
These fees are based on net sales of the joint venture. However,
the tolling fee is based on cost of goods manufactured by us for
the joint venture. In addition, through November 2000,
Henkel will pay a disproportionate share of the marketing
expenses incurred by the joint venture.

Condensed balance sheet information for the joint venture and
Dial were:

|                                   |  |                |        | 
|---------------------------------- |  | -------------- | ------ | 
|                                   |  | December 31,  
|                                   |  | 1999          
|                                   |  |               
|                                   |  | (in thousands)
|                                  
|                                  
|                                  
|                                  
|Joint Venture                      |  |                |        | 
|                                  
|                                  
|                                  
|                                  
|Current assets                     |  | $              | 19,699 | 
|                                  
|                                  
|                                  
|                                  
|Noncurrent assets                  |  |                | 15,453 | 
|                                  
|                                  
|                                  
|                                  
|Current liabilities                |  |                | 15,982 | 
|                                  
|                                  
|                                  
|                                  
|Noncurrent liabilities             |  |                | 15,000 | 
|                                  
|                                  
|                                  
|                                  
|Dial                               |  |                |        | 
|                                  
|                                  
|                                  
|                                  
|Investment in joint venture        |  | $              | 2,964  | 
|                                  
|                                  
|                                  
|                                  
|Note receivable from joint venture |  |                | 7,500  | 
|                                  
|                                  
|                                  
|                                  
|Amount due from joint venture      |  |                | 10,855 | 

The note receivable is due August 2004 and bears interest at
 7.0%, per annum. The note is included in other assets.
Dial incurs the cost to manufacture the joint venture products
and bills the joint venture monthly for the costs incurred. This
is labeled as Amount due from joint venture and is included in
other current assets.

Note 5.  Income and Expense Items

During 1998, the Purex Toss n Softbrand and related
 inventories were sold to Church & Dwight Co., Inc., for
approximately $5.3 million. In addition, a nonoperating
manufacturing property was sold for $4.0 million to a third
party. No gain or loss was realized on the transactions.

In the third quarter of 1997, the Company sold to Church &
Dwight Co., Inc., for $30.2 million Brillosoap pads and
related products, Parsons ammonia, Bo Peep
ammonia, Sno Boltoilet bowl cleaner, Cameometal
cleaner and Rain Dropswater softener. The Companys
London, Ohio, plant, where Brillowas manufactured, also
was part of the sale. In addition, the Company sold to other
third parties for approximately $4.5 million its Bruce
floor care trademark and its Magicsizing starch brand and
 related inventories. Included in operating income is an
aggregate gain of $15.7 million from the sale of these
businesses.

Also included in 1997 operating income is $15.9 million of
various impairment and other operating charges. In the third
quarter of 1997, the Company evaluated the estimated life of the
capitalized package design costs, which were being amortized over
 five years. In light of the accelerated pace of package design

29



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


changes taking place for us and the industry, the estimated life
of the capitalized package design costs was changed to one year.
Accordingly, $9.5 million of capitalized package design costs
were considered impaired and written-off against income. In
addition, we charged against income $4.5 million in discontinued
product sales returns and $1.9 million in additional promotion
claims on discontinued products.

Note 6.  Inventories

Inventories consisted of the following at December 31, in
thousands:

|                           |  |      |         |      |  |   |         | 
|-------------------------- |  | ---- | ------- | ---- |  | - | ------- | 
|                           |  | 1999 |         | 1998
|                           |  |      |         |     
|Raw materials and supplies |  | $    | 51,127  |      |  | $ | 55,791  | 
|                          
|                          
|                          
|                          
|Work in process            |  |      | 9,712   |      |  |   | 7,855   | 
|                          
|                          
|                          
|                          
|Finished goods             |  |      | 119,905 |      |  |   | 91,795  | 
|                           |  |      |         |      |  |   |         | 
|                           |  | $    | 180,744 |      |  | $ | 155,441 | 
|                           |  |      |         |      |  |   |         | 

Note 7.  Property and Equipment

Property and equipment consisted of the following at
December 31, in thousands:

|                                     |  |      |          |      |  |   |          |  
|------------------------------------ |  | ---- | -------- | ---- |  | - | -------- | -
|                                     |  | 1999 |          | 1998
|                                     |  |      |          |     
|Land                                 |  | $    | 10,060   |      |  | $ | 10,057   |  
|                                    
|                                    
|                                    
|                                    
|Buildings and leasehold improvements |  |      | 110,220  |      |  |   | 118,630  |  
|                                    
|                                    
|                                    
|                                    
|Machinery and other equipment        |  |      | 434,369  |      |  |   | 385,616  |  
|                                    
|                                    
|                                    
|                                    
|Construction in progress             |  |      | 38,192   |      |  |   | 32,093   |  
|                                     |  |      |          |      |  |   |          |  
|                                     |  |      | 592,841  |      |  |   | 546,396  |  
|                                    
|                                    
|                                    
|                                    
|Less accumulated depreciation        |  |      | (286,256 | )    |  |   | (265,094 | )
|                                     |  |      |          |      |  |   |          |  
|                                     |  | $    | 306,585  |      |  | $ | 281,302  |  
|                                     |  |      |          |      |  |   |          |  

Note 8.  Intangibles

Intangibles consisted of the following at December 31, in
thousands:

|                                    |  |      |         |      |  |   |         |  
|----------------------------------- |  | ---- | ------- | ---- |  | - | ------- | -
|                                    |  | 1999 |         | 1998
|                                    |  |      |         |     
|Goodwill(1)                         |  | $    | 475,517 |      |  | $ | 488,870 |  
|                                   
|                                   
|                                   
|                                   
|Trademarks and patents              |  |      | 57,882  |      |  |   | 52,718  |  
|                                   
|                                   
|                                   
|                                   
|Customer list and other intangibles |  |      | 76,792  |      |  |   | 78,365  |  
|                                    |  |      |         |      |  |   |         |  
|                                    |  |      | 610,191 |      |  |   | 619,953 |  
|                                   
|                                   
|                                   
|                                   
|Less accumulated amortization       |  |      | (85,446 | )    |  |   | (73,954 | )
|                                    |  |      |         |      |  |   |         |  
|                                    |  | $    | 524,745 |      |  | $ | 545,999 |  
|                                    |  |      |         |      |  |   |         |  




|    |                                                                                                   
|--- | --------------------------------------------------------------------------------------------------
|(1) | Includes $155,259,000 of goodwill arising prior to
	November 1, 1970, that is not being amortized.

30



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


Note 9.  Other Current Liabilities

Other current liabilities consisted of the following at
December 31, in thousands:

|                             |  |      |        |      |  |   |         | 
|---------------------------- |  | ---- | ------ | ---- |  | - | ------- | 
|                             |  | 1999 |        | 1998
|                             |  |      |        |     
|Accrued compensation         |  | $    | 23,335 |      |  | $ | 25,038  | 
|                            
|                            
|                            
|                            
|Accrued trade promotions     |  |      | 24,197 |      |  |   | 24,390  | 
|                            
|                            
|                            
|                            
|Employee benefit liabilities |  |      | 23,341 |      |  |   | 18,114  | 
|                            
|                            
|                            
|                            
|Dividends payable            |  |      | 7,771  |      |  |   | 7,905   | 
|                            
|                            
|                            
|                            
|Other                        |  |      | 20,956 |      |  |   | 31,216  | 
|                             |  |      |        |      |  |   |         | 
|                             |  | $    | 99,600 |      |  | $ | 106,663 | 
|                             |  |      |        |      |  |   |         | 

Note 10.  Debt

Short-term debt consisted of the following at December 31,
in thousands:

|                                                                                                                                                                                                                                                                          |                       |      |        |        |  |   |        |        | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------- | ---- | ------ | ------ |  | - | ------ | ------ | 
|                                                                                                                                                                                                                                                                          |                       | 1999 |        | 1998  
|                                                                                                                                                                                                                                                                          |                       |      |        |       
|Short-term bank borrowings, with interest rates at December 
	 31, 1999, ranging from 6.39% to 7.65%                                                                                                                                                                      |                       | $    | 43,851 |        |  |   |        |       
|                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                         
|Bank loan to our Argentinean subsidiary, Nuevo Federal. The loan
	is denominated in Argentinean Pesos, bears interest at the
	banks short-term rate (10% at December 31, 1999) and
	reprices monthly. The loan is subject to call by the bank at the
	end of each month. |                       |      | 16,312 |        |  | $ | 10,389 |       
|                                                                                                                                                                                                                                                                          |                       |      |        |        |  |   |        |       
|                                                                                                                                                                                                                                                                          | Total short-term debt |      | $      | 60,163 |  |   | $      | 10,389 | 
|                                                                                                                                                                                                                                                                          |                       |      |        |        |  |   |        |       

Long-term debt consisted of the following at December 31, in
 thousands:

|                                                                                                                                                           |                      |      |         |         |  |   |         |         | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------- | ---- | ------- | ------- |  | - | ------- | ------- | 
|                                                                                                                                                           |                      | 1999 |         | 1998   
|                                                                                                                                                           |                      |      |         |        
|State of Arizona Economic Development Loan, due beginning July of
	 2000 in equal installments over 10 years                                               |                      | $    | 1,000   |         |  | $ | 667     |        
|                                                                                                                                                          
|                                                                                                                                                          
|                                                                                                                                                          
|                                                                                                                                                          
|$200 million 6.5% Senior Notes due 2008, net of issue discount                                                                                             |                      |      | 198,142 |         |  |   | 197,938 |        
|                                                                                                                                                          
|                                                                                                                                                          
|                                                                                                                                                          
|                                                                                                                                                          
|Commercial Paper issuances, supported by the long-term revolving
	Credit Agreement, with interest rates at December 31, 1999,
	ranging from 5.72% to 6.55% |                      |      | 101,809 |         |  |   |        |        
|                                                                                                                                                          
|                                                                                                                                                          
|                                                                                                                                                          
|                                                                                                                                                          
|Short-term bank borrowings, supported by the long-term revolving
	Credit Agreement                                                                         |                      |      |        |         |  |   | 81,618  |        
|                                                                                                                                                           |                      |      |         |         |  |   |         |        
|                                                                                                                                                           | Total long-term debt |      | $       | 300,951 |  |   | $       | 280,223 | 
|                                                                                                                                                           |                      |      |         |         |  |   |         |        

On September 23, 1998, we issued $200 million of 6.5% Senior
 Notes due 2008. The Indenture governing these Senior Notes
imposes restrictions on us with respect to, among other things,
our ability to redeem the Senior Notes, place liens on certain
properties and enter into certain sale and leaseback
transactions.

In July 1999, we initiated a $350 million commercial paper
program. The program allows us to issue unsecured short-term
notes of between one and 270 days to investors. As is customary
with commercial paper programs, we are required by credit rating
agencies to maintain our revolving long-term credit agreement as
a condition of receiving and upholding appropriate credit ratings
 for the program. Accordingly, at the time of the initiation of
the commercial paper program, the short-term bank borrowings that
 had been classified as long-term because they were supported by
the credit agreement, were classified as short-term.

At December 31, 1999, long-term debt included commercial
paper issuances classified as long-term because they are
supported by our $350 million long-term, revolving credit
agreement.

31



---



##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


At December 31, 1999, we had $350 million available under
the credit agreement. Borrowings under the credit agreement are
on a revolving basis under commitments available until
August 15, 2002. The interest rate applicable to bank
borrowings under the credit agreement is, at Dials option,
indexed to the bank prime rate or the London Interbank Offering
Rate (LIBOR), plus appropriate spreads over such
indices during the period of the credit agreement. The agreement
also provides for commitment fees. These spreads and fees will
change moderately should our debt ratings change.

The financial covenants of the credit agreement require us to
maintain stockholders equity equal to 80% of such equity as
 of the spin-off date (August 15, 1996) plus 25% of net
income subsequent thereto plus certain other additions to
stockholders equity. We also are required to maintain a
three-to-one ratio of long-term debt to income before interest,
taxes, depreciation and amortization. Under the most restrictive
of these covenants, approximately $185 million of
stockholders equity was available for dividends as of
December 31, 1999.

Interest expense incurred in 1999, 1998 and 1997 was, in
thousands, $22,053, $10,526, and $13,152, respectively. Interest
paid to lenders in 1999, 1998 and 1997 was, in thousands,
$21,079, $9,575 and $13,568, respectively.

The fair value of the Senior Notes was, in thousands, $183,286
and $201,228 at December 31, 1999 and 1998, respectively.

Note 11.  Income Taxes.

The deferred income tax assets (liabilities) included in the
 Consolidated Balance Sheet at December 31 are related to
the following, in thousands:

|                                    |  |      |         |      |  |   |         |  
|----------------------------------- |  | ---- | ------- | ---- |  | - | ------- | -
|                                    |  | 1999 |         | 1998
|                                    |  |      |         |     
|Property, plant and equipment       |  | $    | (31,275 | )    |  | $ | (25,806 | )
|                                   
|                                   
|                                   
|                                   
|Pension and other employee benefits |  |      | 82,405  |      |  |   | 77,921  |  
|                                   
|                                   
|                                   
|                                   
|Reserves, accruals and other        |  |      | 22,885  |      |  |   | 29,773  |  
|                                   
|                                   
|                                   
|                                   
|Deferred state income taxes         |  |      | 9,037   |      |  |   | 13,495  |  
|                                    |  |      |         |      |  |   |         |  
|                                    |  | $    | 83,052  |      |  | $ | 95,383  |  
|                                    |  |      |         |      |  |   |         |  

The combined provision for income taxes consisted of the
following, in thousands:

|                           |                |         |        |      |        |      |        |       |        |   |        |     |        | 
|-------------------------- | -------------- | ------- | ------ | ---- | ------ | ---- | ------ | ----- | ------ | - | ------ | --- | ------ | 
|                           |                | 1999    |        | 1998 |        | 1997
|                           |                |         |        |      |        |     
|Current:                   |                |         |        |      |        |      |        |       |        |   |        |    
|                          
|                          
|                          
|                          
|                           | United States: |         |        |      |        |      |        |       |        |   |        |     |       
|                          
|                          
|                          
|                          
|                           |                | Federal |        | $    | 53,455 |      |        | $     | 21,898 |   |        | $   | 10,744 | 
|                          
|                          
|                          
|                          
|                           |                | State   |        |      | 4,762  |      |        |       | 1,677  |   |        |     | 2,024  | 
|                          
|                          
|                          
|                          
|                           | Foreign        |         |        | 165  |        |      |        | 1,151 |        |   |        | 912 |       
|                           |                |         |        |      |        |      |        |       |        |   |        |    
|                           |                |         | 58,382 |      |        |      | 24,726 |       |        |   | 13,680 |    
|                           |                |         |        |      |        |      |        |       |        |   |        |    
|Deferred:                  |                |         |        |      |        |      |        |       |        |   |        |    
|                          
|                          
|                          
|                          
|                           | United States: |         |        |      |        |      |        |       |        |   |        |     |       
|                          
|                          
|                          
|                          
|                           |                | Federal |        |      | 2,333  |      |        |       | 31,266 |   |        |     | 30,133 | 
|                          
|                          
|                          
|                          
|                           |                | State   |        |      | 3,602  |      |        |       | 1,969  |   |        |     | 6,412  | 
|                           |                |         |        |      |        |      |        |       |        |   |        |    
|                           |                |         | 5,935  |      |        |      | 33,235 |       |        |   | 36,545 |    
|                           |                |         |        |      |        |      |        |       |        |   |        |    
|Provision for income taxes |                | $       | 64,317 |      |        | $    | 57,961 |       |        | $ | 50,225 |    
|                           |                |         |        |      |        |      |        |       |        |   |        |    

Income taxes paid in 1999, 1998 and 1997 amounted to, in
thousands, $18,706, $23,110 and $4,577, respectively.

32



---



##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


A reconciliation between the statutory federal income tax rate
and the Companys consolidated effective income tax rate for
 each of the years ended December 31, 1999, is as follows:

|                                 |  |      |      |      |  |      |      |   |  |  |      |  
|-------------------------------- |  | ---- | ---- | ---- |  | ---- | ---- | - |  |  | ---- | -
|                                 |  | 1999 |      | 1998 |  | 1997
|                                 |  |      |      |      |  |     
|Federal statutory rate           |  |      | 35.0 | %    |  |      | 35.0 | % |  |  | 35.0 | %
|                                
|                                
|                                
|                                
|Goodwill amortization            |  |      | .5   |      |  |      | .5   |   |  |  | .4   |  
|                                
|                                
|                                
|                                
|Foreign Sales Corp. benefit      |  |      | (.5  | )    |  |      | (.6  | ) |  |  | (.7  | )
|                                
|                                
|                                
|                                
|State income taxes               |  |      | 3.0  |      |  |      | 3.2  |   |  |  | 3.7  |  
|                                
|                                
|                                
|                                
|Impact of lower foreign tax rate |  |      | (1.9 | )    |  |      | (1.5 | ) |  |  | (1.1 | )
|                                
|                                
|                                
|                                
|Other, net                       |  |      | (.6  | )    |  |      | (.5  | ) |  |  | .2   |  
|                                 |  |      |      |      |  |      |      |   |  |  |      |  
|Effective income tax rate        |  |      | 35.5 | %    |  |      | 36.1 | % |  |  | 37.5 | %
|                                 |  |      |      |      |  |      |      |   |  |  |      |  

Note 12.  Pension and Other Benefits

Pension Plans.Trusteed, noncontributory pension plans
cover substantially all employees, with benefit levels
supplemented in most cases by defined matching common stock
contributions to employees 401(k) plans. Defined benefits
are based primarily on final average salary and years of service.
 Funding policies provide that payments to defined benefit
pension trusts shall be at least equal to the minimum funding
required by applicable regulations.

The following table provides information on the status of the
plans at December 31, in thousands:

|                                        |                                                   |      |   |         |   |  |   |         |  
|--------------------------------------- | ------------------------------------------------- | ---- | - | ------- | - |  | - | ------- | -
|                                        |                                                   | 1999 |   | 1998   
|                                        |                                                   |      |   |        
|Change in Projected Benefit Obligation: |                                                   |      |   |         |   |  |   |        
|                                       
|                                       
|                                       
|                                       
|                                        | Projected benefit obligation at beginning of year |      | $ | 189,692 |   |  | $ | 161,399 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Service cost                                      |      |   | 5,306   |   |  |   | 4,230   |  
|                                       
|                                       
|                                       
|                                       
|                                        | Interest cost                                     |      |   | 12,964  |   |  |   | 12,239  |  
|                                       
|                                       
|                                       
|                                       
|                                        | Plan amendments                                   |      |   | 193     |   |  |   |         |  
|                                       
|                                       
|                                       
|                                       
|                                        | Actuarial (gain)/loss                             |      |   | (20,967 | ) |  |   | 18,131  |  
|                                       
|                                       
|                                       
|                                       
|                                        | Other (adjustments to past service costs)         |      |   | (576    | ) |  |   | 2,809   |  
|                                       
|                                       
|                                       
|                                       
|                                        | Benefits paid                                     |      |   | (9,941  | ) |  |   | (9,116  | )
|                                        |                                                   |      |   |         |   |  |   |        
|                                        | Projected benefit obligation                      |      | $ | 176,671 |   |  | $ | 189,692 |  
|                                        |                                                   |      |   |         |   |  |   |        
|Change in Plan Assets:                  |                                                   |      |   |         |   |  |   |        
|                                       
|                                       
|                                       
|                                       
|                                        | Fair value of plan assets at beginning of year    |      | $ | 156,074 |   |  | $ | 157,616 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Actual return on plan assets                      |      |   | 28,666  |   |  |   | 6,678   |  
|                                       
|                                       
|                                       
|                                       
|                                        | Company contributions                             |      |   | 1,366   |   |  |   | 896     |  
|                                       
|                                       
|                                       
|                                       
|                                        | Benefits paid                                     |      |   | (9,941  | ) |  |   | (9,116  | )
|                                        |                                                   |      |   |         |   |  |   |        
|                                        | Fair value of plan assets                         |      | $ | 176,165 |   |  | $ | 156,074 |  
|                                        |                                                   |      |   |         |   |  |   |        
|Reconciliation of Funded Status:        |                                                   |      |   |         |   |  |   |        
|                                       
|                                       
|                                       
|                                       
|                                        | Funded status                                     |      | $ | (506    | ) |  | $ | (33,618 | )
|                                       
|                                       
|                                       
|                                       
|                                        | Unrecognized transition obligation                |      |   | 274     |   |  |   | 601     |  
|                                       
|                                       
|                                       
|                                       
|                                        | Unrecognized prior service cost                   |      |   | 4,370   |   |  |   | 4,692   |  
|                                       
|                                       
|                                       
|                                       
|                                        | Unrecognized actuarial (gain)/loss                |      |   | (29,383 | ) |  |   | 7,547   |  
|                                        |                                                   |      |   |         |   |  |   |        
|                                        | Accrued pension cost                              |      | $ | (25,245 | ) |  | $ | (20,778 | )
|                                        |                                                   |      |   |         |   |  |   |        

33



---



##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


|                                                      |                              |      |   |         |   |  |   |         |  
|----------------------------------------------------- | ---------------------------- | ---- | - | ------- | - |  | - | ------- | -
|                                                      |                              | 1999 |   | 1998   
|                                                      |                              |      |   |        
|Amounts Recognized in the Consolidated Balance Sheet: |                              |      |   |         |   |  |   |        
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Prepaid pension cost         |      | $ | 5,066   |   |  | $ | 1,710   |  
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Accrued benefit liability    |      |   | (30,311 | ) |  |   | (32,403 | )
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Additional minimum liability |      |   | 0       |   |  |   | 9,915   |  
|                                                      |                              |      |   |         |   |  |   |        
|                                                      | Net amount recognized        |      | $ | (25,245 | ) |  | $ | (20,778 | )
|                                                      |                              |      |   |         |   |  |   |        

At December 31, 1999, and 1998 the plans held 84,367 and
501,584 shares of common stock of the Company, respectively.

The projected benefit obligation, accumulated benefit obligation
and fair value of plan assets for the pension plans with
accumulated benefit obligations in excess of plan assets were, in
 thousands, $8,124, $6,202 and $0, as of December 31, 1999,
and $99,455, $97,156 and $81,083 as of December 31, 1998.

Components of the net periodic pension cost is summarized in the
following table, in thousands:

|                                          |                                     |                                |   |         |     |      |   |         |     |  |   |         |     | 
|----------------------------------------- | ----------------------------------- | ------------------------------ | - | ------- | --- | ---- | - | ------- | --- |  | - | ------- | --- | 
|                                          |                                     | 1999                           |   | 1998    |     | 1997
|                                          |                                     |                                |   |         |     |     
|Calculation of Net Periodic Pension Cost: |                                     |                                |   |         |     |      |   |         |     |  |   |        
|                                         
|                                         
|                                         
|                                         
|                                          | Service cost                        |                                | $ | 5,306   |     |      | $ | 4,230   |     |  | $ | 4,354   |    
|                                         
|                                         
|                                         
|                                         
|                                          | Interest cost                       |                                |   | 12,964  |     |      |   | 12,239  |     |  |   | 11,923  |    
|                                         
|                                         
|                                         
|                                         
|                                          | Expected return on plan assets      |                                |   | (14,623 | )   |      |   | (13,439 | )   |  |   | (11,965 | )  
|                                         
|                                         
|                                         
|                                         
|                                          | Amortization of:                    |                                |   |         |     |      |   |         |     |  |   |         |    
|                                         
|                                         
|                                         
|                                         
|                                          |                                     | Net transition obligation      |   |         | 327 |      |   |         | 327 |  |   |         | 327 | 
|                                         
|                                         
|                                         
|                                         
|                                          |                                     | Unrecognized past service cost |   |         | 515 |      |   |         | 450 |  |   |         | 446 | 
|                                         
|                                         
|                                         
|                                         
|                                          |                                     | Actuarial loss                 |   |         | 434 |      |   |         | 238 |  |   |         | 188 | 
|                                          |                                     |                                |   |         |     |      |   |         |     |  |   |        
|                                          | Net periodic pension cost           |                                | $ | 4,923   |     |      | $ | 4,045   |     |  | $ | 5,273   |    
|                                          |                                     |                                |   |         |     |      |   |         |     |  |   |        
|                                          | Curtailment (Gain)/ Loss            |                                | $ |        |     |      | $ |        |     |  | $ | 86      |    
|                                          |                                     |                                |   |         |     |      |   |         |     |  |   |        
|                                          | Other Comprehensive (Income)/ Loss  |                                | $ | (8,981  | )   |      | $ | 9,730   |     |  | $ | (6,068  | )  
|                                          |                                     |                                |   |         |     |      |   |         |     |  |   |        
|                                          | Discount rate for obligation        |                                |   | 8.00    | %   |      |   | 7.00    | %   |  |   | 7.75    | %  
|                                         
|                                         
|                                         
|                                         
|                                          | Long-term rate of investment return |                                |   | 10.00   | %   |      |   | 10.00   | %   |  |   | 10.00   | %  
|                                         
|                                         
|                                         
|                                         
|                                          | Salary increase rate                |                                |   | 4.00    | %   |      |   | 4.00    | %   |  |   | 4.00    | %  

Defined Contribution Plans.We maintain various 401(K)
defined contribution plans whereby employees can contribute up to
 12% of their salary. We contribute to these plans throughout the
 year. For the years ended December 31, 1999,
December 31, 1998, and January 3, 1998, defined
contribution plan expense was, in thousands, $2,321, $2,026, and
$2,002, respectively.

Multi-Employer Pension Plans.We participate in three
multi-employer pension plans. For the years ended
December 31, 1999, December 31, 1998, and
January 3, 1998, our costs were, in thousands, $1,519,
$1,259 and $1,135, respectively.

Post-Retirement Benefits Other Than Pensions.We
have defined benefit post retirement plans that provide medical
and life insurance for eligible employees, retirees and
dependents. In addition, we retained the obligations for such
benefits for eligible retirees of Armour and Company (sold in
1983).

34



---



##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


We accrue post-retirement benefits other than pensions during the
 years the employees provide services. The status of the plans
are as follows as of December 31, in thousands:

|                                                     |                                                |      |          |          |   |   |          |          |  
|---------------------------------------------------- | ---------------------------------------------- | ---- | -------- | -------- | - | - | -------- | -------- | -
|                                                     |                                                | 1999 |          | 1998    
|                                                     |                                                |      |          |         
|Change in Benefit Obligation:                        |                                                |      |          |          |   |   |          |         
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Benefit obligation at beginning of year        |      | $        | 198,688  |   |   | $        | 190,117  |  
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Service cost                                   |      |          | 1,835    |   |   |          | 2,005    |  
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Interest cost                                  |      |          | 12,506   |   |   |          | 13,994   |  
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Plan participants contributions               |      |          | 1,022    |   |   |          | 1,091    |  
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Amendments                                     |      |          | (9,255   | ) |   |          | (2,274   | )
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Actuarial (gain)/loss                          |      |          | (24,299  | ) |   |          | 10,830   |  
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Benefits paid                                  |      |          | (18,354  | ) |   |          | (17,075  | )
|                                                     |                                                |      |          |          |   |   |          |         
|                                                     | Benefit obligation at end of year              |      | $        | 162,143  |   |   | $        | 198,688  |  
|                                                     |                                                |      |          |          |   |   |          |         
|Change in Plan Assets:                               |                                                |      |          |          |   |   |          |         
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Fair value of plan assets at beginning of year |      | $        |         |   |   | $        |         |  
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Employer contribution                          |      |          | 17,332   |   |   |          | 15,984   |  
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Plan participants contribution                |      |          | 1,022    |   |   |          | 1,091    |  
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Benefits paid                                  |      |          | (18,354  | ) |   |          | (17,075  | )
|                                                     |                                                |      |          |          |   |   |          |         
|                                                     | Fair value of plan assets at end of year       |      | $        |         |   |   | $        |         |  
|                                                     |                                                |      |          |          |   |   |          |         
|                                                     | Funded status                                  |      | $        | (162,143 | ) |   | $        | (198,688 | )
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Unrecognized net gain                          |      |          | (34,421  | ) |   |          | (11,873  | )
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Unrecognized prior service cost                |      |          | (20,842  | ) |   |          | (13,314  | )
|                                                     |                                                |      |          |          |   |   |          |         
|                                                     | Accrued benefit cost                           |      | $        | (217,406 | ) |   | $        | (223,875 | )
|                                                     |                                                |      |          |          |   |   |          |         
|Amounts Recognized in the Consolidated Balance Sheet |                                                | $    | (217,406 | )        |   | $ | (223,875 | )       
|                                                     |                                                |      |          |          |   |   |          |         

|                              |               |              |  |              |   |            |  |      |   |  |  |      |  
|----------------------------- | ------------- | ------------ |  | ------------ | - | ---------- |  | ---- | - |  |  | ---- | -
|                              |               | December 31, |  | December 31, |   | January 3,
|                              |               | 1999         |  | 1998         |   | 1998      
|                              |               |              |  |              |   |           
|Weighted-average assumptions: |               |              |  |              |   |            |  |      |   |  |  |     
|                             
|                             
|                             
|                             
|                              | Discount rate |              |  | 8.00         | % |            |  | 7.00 | % |  |  | 7.75 | %

The assumed health care cost trend rate used to measure the
accumulated post-retirement benefit obligation for retirees below
 the age of 65 for 1999 is 8.0%, and for retirees above age 65
for 1999 is 6.5%, both gradually declining to an ultimate rate of
 5% in 2002.

|                          |                                 |                |        |              |   |            |        |        |   |   |        |        |  
|------------------------- | ------------------------------- | -------------- | ------ | ------------ | - | ---------- | ------ | ------ | - | - | ------ | ------ | -
|                          |                                 | December 31,   |        | December 31, |   | January 3,
|                          |                                 | 1999           |        | 1998         |   | 1998      
|                          |                                 |                |        |              |   |           
|                          |                                 |               
|                          |                                 | (in thousands)
|                         
|                         
|                         
|                         
|Service cost              |                                 | $              | 1,835  |              |   | $          | 2,005  |        |   | $ | 2,276  |       
|                         
|                         
|                         
|                         
|Interest cost             |                                 |                | 12,506 |              |   |            | 13,994 |        |   |   | 14,453 |       
|                         
|                         
|                         
|                         
|Amortization of:          |                                 |                |        |              |   |            |        |        |   |   |        |       
|                         
|                         
|                         
|                         
|                          | Unrecognized prior service cost |                |        | (1,727       | ) |            |        | (1,172 | ) |   |        | (881   | )
|                         
|                         
|                         
|                         
|                          | Actuarial gain                  |                |        | (1,751       | ) |            |        | (1,670 | ) |   |        | (2,567 | )
|                          |                                 |                |        |              |   |            |        |        |   |   |        |       
|Net periodic benefit cost |                                 | $              | 10,863 |              |   | $          | 13,157 |        |   | $ | 13,281 |       
|                          |                                 |                |        |              |   |            |        |        |   |   |        |       

The 1999, 1998 and 1997 components of net periodic post
retirement benefit cost reflect expense of approximately $5.7
million, $6.8 million and $5.8 million, respectively, incurred on
 the Armour employee benefit liabilities, which are included in
Interest and Other Expenses in the Statement of
Consolidated Operations.

35



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


Effect of one-percentage-point change in assumed health care
cost trend rates:

|                                                            |  |          |        |            |  |   |         |  
|----------------------------------------------------------- |  | -------- | ------ | ---------- |  | - | ------- | -
|                                                            |  | Increase |        | (Decrease)
|                                                            |  |          |        |           
|Effect on the total of service and interest cost components |  | $        | 1,534  |            |  | $ | (1,277  | )
|                                                           
|                                                           
|                                                           
|                                                           
|Effect on accumulated post-retirement benefit obligation    |  | $        | 13,615 |            |  | $ | (11,702 | )

Note 13.  Stock Options

On August 15, 1996, we were spun-off from former parent.
Options granted between 1990 and 1996 to certain officers and
employees to acquire our common stock were granted under former
parents stock option plans. These options have been
adjusted for stock splits and the Spin-off. These options were
granted at the market prices on the dates of grant, became
exercisable 50% after one year and 100% after two years and
expire after 10 years. No additional options will be granted
 under these plans.

We adopted The Dial Corporation Stock Incentive Plan in 1996
(1996 Plan) which is administered by the Executive
Compensation Committee of the Board of Directors. Under the 1996
Plan, the aggregate number of shares of common and preferred
stock covered by awards to any one individual cannot exceed
1,000,000 shares for any three-year period (plus shares necessary
 to replace options granted by former parents and
transferred to the Company as part of the spin-off), and no more
than 9,600,000 shares are cumulatively available for options
intended to qualify as incentive stock options under
the Internal Revenue Code. The term of the options is
10 years. The Plan provides that options are generally to be
 granted at the market price on the date of grant; however, the
Executive Compensation Committee may grant options at less than
such market price. The 1996 Plan also authorizes the issuance of
stock appreciation rights and restricted stock.

Under the 1996 Plan, options to purchase 81,382 shares were
granted at the market price on the dates of grant during 1999.
After one year, one-third of the options become exercisable when
the average closing market price over 20 consecutive days equals
or exceeds 133% of the option price, two-thirds when such price
equals or exceeds 167% of the option price and 100% when such
price equals or exceeds 200% of the option price. All such
options become exercisable, in any event, after five years from
the date of grant.

Options to purchase 1,727,000 shares were granted at the market
price on the dates of grant during 1999. After one year,
one-third of the options become exercisable when the average
closing market price over 20 consecutive days equals or exceeds
120% of the option price. After two years, two-thirds of the
options become exercisable when such price equals or exceeds 140%
 of the option price. The options become 100% exercisable after
three years and when such price equals or exceeds 160% of the
option price. All such options become exercisable, in any event,
after five years from the date of grant. In addition, in March
2000 options to purchase 2,210,600 shares were granted under the
1996 Plan at a market price of $14.84.

During 1999, options to purchase 26,400 shares also were granted
to nonemployee members of the Board of Directors at the market
price on the date of grant. Such options are exercisable 50%
after one year and 100% after two years. The options expire after
 10 years.

36



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


A summary of the status of our stock option plans as of
December 31, 1999, and changes during the fiscal years 1997,
 1998 and 1999, are presented below:

|                                   |           |        |            |                  |   |   |       |       | 
|---------------------------------- | --------- | ------ | ---------- | ---------------- | - | - | ----- | ----- | 
|                                   |           |        |            | Weighted Average
|                                   |           | Shares |            | Exercise Price  
|                                   |           |        |            |                 
|Outstanding at December 28, 1996   |           |        | 10,169,574 |                  |   | $ | 11.76 |      
|                                  
|                                  
|                                  
|                                  
|                                   | Granted   |        |            | 1,283,352        |   |   |       | 16.23 | 
|                                  
|                                  
|                                  
|                                  
|                                   | Exercised |        |            | (1,415,570       | ) |   |       | 9.57  | 
|                                  
|                                  
|                                  
|                                  
|                                   | Canceled  |        |            | (1,056,435       | ) |   |       | 13.23 | 
|                                   |           |        |            |                  |   |   |       |      
|Outstanding at January 3, 1998     |           |        | 8,980,921  |                  |   |   | 12.60 |      
|                                  
|                                  
|                                  
|                                  
|                                   | Granted   |        |            | 328,106          |   |   |       | 23.78 | 
|                                  
|                                  
|                                  
|                                  
|                                   | Exercised |        |            | (2,253,436       | ) |   |       | 11.62 | 
|                                  
|                                  
|                                  
|                                  
|                                   | Canceled  |        |            | (701,845         | ) |   |       | 14.29 | 
|                                   |           |        |            |                  |   |   |       |      
|Outstanding at December 31, 1998   |           |        | 6,353,746  |                  |   |   | 13.34 |      
|                                  
|                                  
|                                  
|                                  
|                                   | Granted   |        |            | 1,834,782        |   |   |       | 29.19 | 
|                                  
|                                  
|                                  
|                                  
|                                   | Exercised |        |            | (1,591,332       | ) |   |       | 12.39 | 
|                                  
|                                  
|                                  
|                                  
|                                   | Canceled  |        |            | (90,142          | ) |   |       | 21.83 | 
|                                   |           |        |            |                  |   |   |       |      
|Outstanding at December 31, 1999   |           |        | 6,507,054  |                  |   | $ | 17.90 |      
|                                   |           |        |            |                  |   |   |       |      
|Options exercisable at end of year |           |        | 4,474,195  |                  |   | $ | 13.08 |      
|                                   |           |        |            |                  |   |   |       |      

The following table summarizes information about stock options
outstanding and exercisable at December 31, 1999:

|                |               |             |  |                  |           |                  |  |             |     |                  |  |   |       |  |  |  |           |  |  |   |       | 
|--------------- | ------------- | ----------- |  | ---------------- | --------- | ---------------- |  | ----------- | --- | ---------------- |  | - | ----- |  |  |  | --------- |  |  | - | ----- | 
|                |               |             |  | Weighted Average |           |                  |  |             |     |                 
|                |               |             |  | Remaining        |           |                  |  |             |     |                 
|Range of        |               | Options     |  | Contractual Life |           | Weighted Average |  | Options     |     | Weighted Average
|Exercise Prices |               | Outstanding |  | (in years)       |           | Exercise Price   |  | Exercisable |     | Exercise Price  
|                |               |             |  |                  |           |                  |  |             |     |                 
|                | $ 5.62-$ 9.23 |             |  |                  | 403,912   |                  |  |             | 2.1 |                  |  | $ | 7.94  |  |  |  | 403,912   |  |  | $ | 7.94  | 
|                | $ 9.30-$11.16 |             |  |                  | 391,811   |                  |  |             | 3.8 |                  |  |   | 10.45 |  |  |  | 391,811   |  |  |   | 10.45 | 
|                | $11.91-$12.88 |             |  |                  | 2,250,439 |                  |  |             | 6.5 |                  |  |   | 12.74 |  |  |  | 2,250,439 |  |  |   | 12.74 | 
|                | $13.37-$14.50 |             |  |                  | 710,606   |                  |  |             | 6.7 |                  |  |   | 14.28 |  |  |  | 710,606   |  |  |   | 14.28 | 
|                | $15.37-$18.32 |             |  |                  | 627,241   |                  |  |             | 7.1 |                  |  |   | 16.36 |  |  |  | 606,001   |  |  |   | 16.31 | 
|                | $19.53-$21.82 |             |  |                  | 157,355   |                  |  |             | 8.5 |                  |  |   | 21.53 |  |  |  | 64,973    |  |  |   | 21.36 | 
|                | $22.37-$25.32 |             |  |                  | 226,402   |                  |  |             | 9.3 |                  |  |   | 23.59 |  |  |  | 33,655    |  |  |   | 23.57 | 
|                | $25.62-$28.72 |             |  |                  | 175,788   |                  |  |             | 9.0 |                  |  |   | 27.34 |  |  |  | 12,798    |  |  |   | 25.86 | 
|                | $29.71-$30.19 |             |  |                  | 1,539,000 |                  |  |             | 9.6 |                  |  |   | 29.73 |  |  |  |           |  |  |   |       | 
|                | $30.75-$36.54 |             |  |                  | 24,500    |                  |  |             | 9.2 |                  |  |   | 33.07 |  |  |  |           |  |  |   |       | 
|                |               |             |  |                  |           |                  |  |             |     |                  |  |   |       |  |  |  |           |  |  |   |       | 
|                |               |             |  |                  | 6,507,054 |                  |  |             | 7.1 |                  |  | $ | 17.90 |  |  |  | 4,474,195 |  |  | $ | 13.08 | 
|                |               |             |  |                  |           |                  |  |             |     |                  |  |   |       |  |  |  |           |  |  |   |       | 

Dial applies APB No. 25, Accounting for Stock Issued
to Employees, and related interpretations in accounting for
 its stock-based compensation plans. Accordingly, no compensation
 expense has been recognized for its stock-based compensation
plans other than for restricted stock awards granted in 1999.
Expense recognized during 1999 on these awards was immaterial.

Average assumptions used in determining the estimated fair value
of stock options under the Black-Scholes valuation model, and the
 estimated fair values are as follows.

37



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


|                                           |  |              |       |              |  |            |      |   |  |   |      |  
|------------------------------------------ |  | ------------ | ----- | ------------ |  | ---------- | ---- | - |  | - | ---- | -
|                                           |  | December 31, |       | December 31, |  | January 3,
|                                           |  | 1999         |       | 1998         |  | 1998      
|                                           |  |              |       |              |  |           
|Estimated fair value of options, per share |  | $            | 10.27 |              |  | $          | 6.63 |   |  | $ | 4.18 |  
|                                          
|                                          
|                                          
|                                          
|Expected average risk-free interest rate   |  |              | 5.8   | %            |  |            | 4.9  | % |  |   | 6.3  | %
|                                          
|                                          
|                                          
|                                          
|Expected life in years                     |  |              | 5.0   |              |  |            | 4.6  |   |  |   | 4.4  |  
|                                          
|                                          
|                                          
|                                          
|Expected volatility                        |  |              | 30.0  | %            |  |            | 27.5 | % |  |   | 25.0 | %
|                                          
|                                          
|                                          
|                                          
|Expected dividend rate                     |  |              | 1.1   | %            |  |            | 1.4  | % |  |   | 2.0  | %

|                                               |  |                |         |      |  |      |         |  |  |   |        | 
|---------------------------------------------- |  | -------------- | ------- | ---- |  | ---- | ------- |  |  | - | ------ | 
|                                               |  | 1999           |         | 1998 |  | 1997
|                                               |  |                |         |      |  |     
|                                               |  |               
|                                               |  | (in thousands)
|                                              
|                                              
|                                              
|                                              
|Net income as reported                         |  | $              | 116,766 |      |  | $    | 102,616 |  |  | $ | 83,710 | 
|                                               |  |                |         |      |  |      |         |  |  |   |        | 
|Pro forma net income                           |  | $              | 115,073 |      |  | $    | 96,912  |  |  | $ | 78,224 | 
|                                               |  |                |         |      |  |      |         |  |  |   |        | 
|Net income per share  basic  as
	reported    |  | $              | 1.19    |      |  | $    | 1.04    |  |  | $ | 0.91   | 
|                                               |  |                |         |      |  |      |         |  |  |   |        | 
|Pro forma net income per share  basic         |  | $              | 1.17    |      |  | $    | 0.99    |  |  | $ | 0.85   | 
|                                               |  |                |         |      |  |      |         |  |  |   |        | 
|Net income per share  diluted  as
	 reported |  | $              | 1.17    |      |  | $    | 1.02    |  |  | $ | 0.89   | 
|                                               |  |                |         |      |  |      |         |  |  |   |        | 
|Pro forma net income per share  diluted       |  | $              | 1.15    |      |  | $    | 0.96    |  |  | $ | 0.83   | 
|                                               |  |                |         |      |  |      |         |  |  |   |        | 

Note 14.  Leases

Certain sales and administration offices and equipment are
leased. The leases expire in periods ranging generally from one
to five years, and some provide for renewal options ranging from
one to eight years. Leases that expire are generally renewed or
replaced by similar leases, depending on business needs at that
time. Net rent expense paid in 1999, 1998 and 1997 totaled, in
thousands, $10,299, $8,989 and $6,533.

At December 31, 1999, the Companys future minimum
rental payments with respect to noncancelable operating leases
with terms in excess of one year were as follows, in thousands:,
$10,209 (2000), $9,339 (2001), $7,978 (2002), $5,580 (2003),
$5,428 (2004) and $14,905 thereafter.

Note 15.  Financial Instruments with
Off-Balance-Sheet Risk and Fair Value of Financial Instruments

Financial Instruments with Off-Balance-Sheet Risk.

Sale of Receivables

At December 31, 1999, we had an agreement to sell undivided
participating interests in a defined pool of trade accounts
receivable in an amount not to exceed $115 million as a means of
accelerating cash flow. From time to time, as collections reduce
accounts receivable in the pool, we sell participating interests
in new receivables. Our expense of selling receivables amounted
to approximately, in thousands, $4,993, $4,295 and $4,752 in
1999, 1998 and 1997, respectively, and are included in the
Statement of Consolidated Operations under the caption
Interest and Other Expenses. Under the terms of the
agreement, we have retained substantially the same risk of credit
 loss as if the receivables had not been sold, as we are
obligated to replace uncollectible receivables with new accounts
receivable. Our accounts receivable sold totaled, in thousands,
$73,177 and $90,000 at December 31, 1999, and 1998,
respectively. Our average accounts receivable sold approximated,
in thousands, $90,300, $82,144, and $70,727 during 1999, 1998 and
 1997.

Commodity Price Management

In the manufacture of our products we utilize a number of
commodities, such as tallow, coconut oil and meat. In addition,
we use a variety of products that are priced based on underlying
commodities, such as plastic bottles (resin). In the normal
course of business, we attempt to enter into supply agreements
that generally fix or set a range of prices of goods to be
purchased. These supply agreements can cover up to

38



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


12 months of supply for goods. Financial derivatives to
hedge or lock in the prices of these commodities over the long
term (greater than one year) generally are not available.

We do utilize financial derivatives to fix the price of the raw
material component of the cardboard boxes and packaging we use in
 our business. Our purchase contracts with our cardboard box
suppliers have provisions that allow the raw material component
of the box price to reset based on movements in the price of
cardboard. This component is based on the Pulp & Paper
Week42 lb. linerboard price index. We have entered into a
series of contracts for 2000 covering a notional amount of 30,000
 tons that allow us to pay a weighted average fixed price per ton
 of cardboard of $435.00 and receive payments based on the Pulp & Paper Weekindex. At December 31, 1999, the
Pulp & Paper Weekindex price was $425/ton. Open
contracts had a fair market loss associated with them of
approximately $175,000.

Employee Benefit Plan Expense

We offer our directors and management deferred compensation
plans. Under these plans, participants can defer a portion of
their compensation into Dial stock units. Deferred compensation
due to participants and any accumulated investment gains or
losses is included on the balance sheet as a liability under the
caption Pension and other benefits. We place
the deferred funds in a Rabbi Trust, which purchases life
insurance policies on the participants lives, with Dial as
the beneficiary. The policies have a cash surrender value that
accrue tax-free earnings based on the performance of the S&P
500. The cash surrender value asset and any accumulated
investment gains or losses is included on the balance sheet as an
 asset under the caption Other assets. To the
extent that the return on Dial shares is different from that of
the S&P 500, income or expense is generated by the plans.

We have entered into a contract with a financial institution that
 provides for an exchange of payments based on the relative
performance of our common shares and the S&P 500. The
contract has a notional amount of 244,000 Dial common shares and
5,200 S&P 500 futures contracts and is renewable quarterly.
At the time of renewal, the index price of Dial shares and the
S&P 500 resets to the current market price. Any income or
loss generated by the contract is recognized in the income
statement and offsets the income statement impact of the deferred
 compensation plan. Because the contract renews near the end of
each quarter, its market value at the end of each quarter (and
accordingly, at December 31, 1999) approximates zero.

Fair Value of Financial Instruments.

The carrying values of cash and cash equivalents, receivables,
accounts payable and short-term bank borrowings approximate fair
values due to the short-term maturities of these instruments.

Note 16.  Segments of an Enterprise

For organizational, marketing and financial reporting purposes,
we have organized into three business segments: (i) Domestic
 Branded, (ii) International, and (iii) Commercial
Markets and Other. The segments were identified based on the
types of products sold, the customer base and method of
distribution.

The Domestic Branded business segment consists of franchises that
 manufacture and market nondurable consumer packaged goods
through grocery store, drug store and mass merchandiser retail
outlets. It is comprised of the Dial, Purex, Renuzit, Armourand Specialty Personal Care operating franchises. We acquired
 Freeman, a leading manufacturer and marketer of skin, hair,
bath, body and foot care products utilizing natural ingredients,
all sold under the Freemanbrand name on July 1,
1998. We also acquired Sarah Michaels, a leading marketer of
premium specialty bath and body products, including body washes,
body mists, luxury soaps, hand and body lotions, loofahs, sponges
 and brushes, which are distributed under the Sarah Michaelsbrand name, on September 14, 1998. These two
acquisitions were combined with our Natures Accents
line of translucent soaps and specialty care products, and our
subsidiary, ISC International, Ltd., a manufacturer of
translucent soaps, to create the Specialty Personal Care
franchise.

39



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


The International business segment consists of our sale of
consumer products outside of the United States, principally in
Argentina, Canada, Mexico, Puerto Rico and the Caribbean.

Our Commercial Markets and Other business sells our products,
both branded and nonbranded, through the commercial channel to
end users such as hotels, hospitals and schools. In addition,
Commercial Markets includes sales of chemicals, principally
glycerin, fatty acids and sulfonates, that are by-products of the
 soap making and detergent making process.

Information as to our operations in different business segments
is set forth below. The accounting policies of the business
segments are the same as those described in the summary of
significant accounting policies (Note 2).

|                           |      |          |   |            |   |          |   |               |  |            |   |              |   |       |   |         |  |  |   |           |   |  |  |        |  |  |   |           |  
|-------------------------- | ---- | -------- | - | ---------- | - | -------- | - | ------------- |  | ---------- | - | ------------ | - | ----- | - | ------- |  |  | - | --------- | - |  |  | ------ |  |  | - | --------- | -
|                           |      |          |   | Commercial |   |          |   |               |  |            |   | Discontinued |   |      
|                           |      | Domestic |   | Markets    |   | Total    |   |               |  | Total      |   | & Divested   |   |      
|                           |      | Branded  |   | and Other  |   | Domestic |   | International |  | Continuing |   | Products     |   | Total
|                           |      |          |   |            |   |          |   |               |  |            |   |              |   |      
|Net Sales:                 |      |          |   |            |   |          |   |               |  |            |   |              |   |       |   |         |  |  |   |           |   |  |  |        |  |  |   |          
|                          
|                          
|                          
|                          
|                           | 1999 |          | $ | 1,477,384  |   |          | $ | 69,583        |  |            | $ | 1,546,967    |   |       | $ | 174,599 |  |  | $ | 1,721,566 |   |  |  |        |  |  | $ | 1,721,566 |  
|                          
|                          
|                          
|                          
|                           | 1998 |          |   | 1,291,272  |   |          |   | 69,102        |  |            |   | 1,360,374    |   |       |   | 164,143 |  |  |   | 1,524,517 |   |  |  |        |  |  |   | 1,524,517 |  
|                          
|                          
|                          
|                          
|                           | 1997 |          |   | 1,149,676  |   |          |   | 77,799        |  |            |   | 1,227,475    |   |       |   | 82,155  |  |  |   | 1,309,630 |   |  |  | 52,976 |  |  |   | 1,362,606 |  
|                          
|                          
|                          
|                          
|Operating Income:          |      |          |   |            |   |          |   |               |  |            |   |              |   |       |   |         |  |  |   |           |   |  |  |        |  |  |   |          
|                          
|                          
|                          
|                          
|                           | 1999 |          |   | 188,247    |   |          |   | 9,185         |  |            |   | 197,432      |   |       |   | 17,710  |  |  |   | 215,142   |   |  |  |        |  |  |   | 215,142   |  
|                          
|                          
|                          
|                          
|                           | 1998 |          |   | 161,686    |   |          |   | 9,081         |  |            |   | 170,767      |   |       |   | 13,168  |  |  |   | 183,935   |   |  |  |        |  |  |   | 183,935   |  
|                          
|                          
|                          
|                          
|                           | 1997 |          |   | 142,430    |   |          |   | 9,814         |  |            |   | 152,244      |   |       |   | 9,046   |  |  |   | 161,290   |   |  |  | 880    |  |  |   | 162,170   |  
|                          
|                          
|                          
|                          
|Capital Expenditures:      |      |          |   |            |   |          |   |               |  |            |   |              |   |       |   |         |  |  |   |           |   |  |  |        |  |  |   |          
|                          
|                          
|                          
|                          
|                           | 1999 |          |   | 55,383     |   |          |   | 63            |  |            |   | 55,446       |   |       |   | 7,049   |  |  |   | 62,495    |   |  |  |        |  |  |   | 62,495    |  
|                          
|                          
|                          
|                          
|                           | 1998 |          |   | 39,039     |   |          |   | 198           |  |            |   | 39,237       |   |       |   | 11,093  |  |  |   | 50,330    |   |  |  |        |  |  |   | 50,330    |  
|                          
|                          
|                          
|                          
|                           | 1997 |          |   | 40,840     |   |          |   | 3,139         |  |            |   | 43,979       |   |       |   | 2,736   |  |  |   | 46,715    |   |  |  |        |  |  |   | 46,715    |  
|                          
|                          
|                          
|                          
|Acquisition of Businesses: |      |          |   |            |   |          |   |               |  |            |   |              |   |       |   |         |  |  |   |           |   |  |  |        |  |  |   |          
|                          
|                          
|                          
|                          
|                           | 1999 |          |   | (6,046     | ) |          |   |               |  |            |   | (6,046       | ) |       |   |         |  |  |   | (6,046    | ) |  |  |        |  |  |   | (6,046    | )
|                          
|                          
|                          
|                          
|                           | 1998 |          |   | 271,043    |   |          |   |               |  |            |   | 271,043      |   |       |   |         |  |  |   | 271,043   |   |  |  |        |  |  |   | 271,043   |  
|                          
|                          
|                          
|                          
|Assets at year end:        |      |          |   |            |   |          |   |               |  |            |   |              |   |       |   |         |  |  |   |           |   |  |  |        |  |  |   |          
|                          
|                          
|                          
|                          
|                           | 1999 |          |   | 1,079,722  |   |          |   | 10,058        |  |            |   | 1,089,780    |   |       |   | 179,906 |  |  |   | 1,269,686 |   |  |  |        |  |  |   | 1,269,686 |  
|                          
|                          
|                          
|                          
|                           | 1998 |          |   | 1,034,425  |   |          |   | 10,005        |  |            |   | 1,044,430    |   |       |   | 130,945 |  |  |   | 1,175,375 |   |  |  |        |  |  |   | 1,175,375 |  

Wal-Mart, including its affiliate Sams Club, was our
largest customer in 1999, 1998 and 1997, accounting for
approximately 18%, 17%, and 17%, respectively, of net sales. No
other customer accounted for more than 10% of net sales in 1999,
1998 or 1997. Net sales in Argentina were $87.0 million and $85.1
 million in 1999 and 1998, respectively. No single foreign
country comprised more than 5% of our total net sales in 1997.

Note 17.  Condensed Consolidated Quarterly Results
(Unaudited)

|                     |           |                                          |         |                |  |               |         |                |  |      |         |      |  |      |         |      |  |   |         |      |  |   |         |      |  |   |         |      |  |   |         |      | 
|-------------------- | --------- | ---------------------------------------- | ------- | -------------- |  | ------------- | ------- | -------------- |  | ---- | ------- | ---- |  | ---- | ------- | ---- |  | - | ------- | ---- |  | - | ------- | ---- |  | - | ------- | ---- |  | - | ------- | ---- | 
|                     |           |                                          |         |                |  |               |         |               
|                     |           | First Quarter                            |         | Second Quarter |  | Third Quarter |         | Fourth Quarter
|                     |           |                                          |         |                |  |               |         |               
|                     |           | 1999                                     |         | 1998           |  | 1999          |         | 1998           |  | 1999 |         | 1998 |  | 1999 |         | 1998
|                     |           |                                          |         |                |  |               |         |                |  |      |         |      |  |      |         |     
|                     |           |                                         
|                     |           | (000 omitted, except for per share data)
|                    
|                    
|                    
|                    
|Net sales            |           | $                                        | 398,948 |                |  | $             | 335,022 |                |  | $    | 430,312 |      |  | $    | 366,798 |      |  | $ | 437,055 |      |  | $ | 383,909 |      |  | $ | 455,251 |      |  | $ | 438,788 |     
|                    
|                    
|                    
|                    
|Gross profit         |           | $                                        | 196,565 |                |  | $             | 158,516 |                |  | $    | 219,061 |      |  | $    | 180,937 |      |  | $ | 216,961 |      |  | $ | 188,459 |      |  | $ | 228,168 |      |  | $ | 209,204 |     
|                    
|                    
|                    
|                    
|Operating income     |           | $                                        | 48,995  |                |  | $             | 40,554  |                |  | $    | 54,498  |      |  | $    | 44,752  |      |  | $ | 55,615  |      |  | $ | 47,144  |      |  | $ | 56,034  |      |  | $ | 51,485  |     
|                    
|                    
|                    
|                    
|Net income           |           | $                                        | 25,886  |                |  | $             | 22,911  |                |  | $    | 29,433  |      |  | $    | 25,607  |      |  | $ | 30,749  |      |  | $ | 26,728  |      |  | $ | 30,698  |      |  | $ | 27,370  |     
|Net income per share |           |                                          |         |                |  |               |         |                |  |      |         |      |  |      |         |      |  |   |         |      |  |   |         |      |  |   |         |      |  |   |         |     
|                    
|                    
|                    
|                    
|                     |  Basic   |                                          | $       | 0.26           |  |               | $       | 0.23           |  |      | $       | 0.30 |  |      | $       | 0.26 |  |   | $       | 0.31 |  |   | $       | 0.27 |  |   | $       | 0.32 |  |   | $       | 0.28 | 
|                    
|                    
|                    
|                    
|                     |  Diluted |                                          | $       | 0.26           |  |               | $       | 0.23           |  |      | $       | 0.29 |  |      | $       | 0.25 |  |   | $       | 0.31 |  |   | $       | 0.27 |  |   | $       | 0.31 |  |   | $       | 0.27 | 

40



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


Note 18.  Litigation and Claims

On May 21, 1999, we were served with a complaint filed by
the U.S. Equal Employment Opportunity Commission (the
EEOC) in the U.S. District Court for the Northern
District of Illinois, Eastern Division. This action is entitled
Equal Employment Opportunity Commission v. The Dial Corporation,
Civil Action No. 99 C 3356. The EEOC alleges that
Dial has engaged in a pattern and practice of discrimination
against a class of female employees by subjecting them to sexual
or sex-based harassment and failing to take prompt remedial
action after these employees complained about this alleged
harassment. The EEOC is seeking to enjoin Dial from this alleged
harassment, to require us to train our managerial employees
regarding the requirements of Title VII of the Civil Rights Act
of 1964 and to recover unspecified compensatory and punitive
damages. We have denied the EEOCs allegations. This lawsuit
 is in the discovery stage and, as a result, assurances cannot be
 given regarding the ultimate outcome of this matter.

We are party to various legal actions, proceedings and pending
claims. Some of the foregoing involve, or may involve,
compensatory, punitive or other damages in material amounts.
Litigation is subject to many uncertainties, and it is possible
that some of the legal actions, proceedings and claims referred
to above could be decided against us. Although the amount of
liability at December 31, 1999, with respect to these
matters is not ascertainable, we believe that any resulting
liability will not materially affect the Companys financial
 position or results of operations.

We are subject to various environmental laws and regulations of
the United States, as well as states and other countries in whose
 jurisdictions we have or had operations and are subject to
certain international agreements. As is the case with many
companies, we face exposure to actual or potential claims and
lawsuits involving environmental matters. Although we are party
to certain environmental disputes, we believe that any
liabilities resulting therefrom, after taking into consideration
amounts already provided for, but exclusive of, any potential
insurance recoveries, will not have a material adverse effect on
our financial position or results of operations. As of
December 31, 1999, we had accrued in our financial
statements approximately $2.3 million in reserves for expenses
related to Superfund and clean-up of closed plant sites.

41



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)







Item 9.  Changes in and Disagreements with
Accountants on Accounting and Financial Disclosure


We have never filed a Current Report on Form 8-K to report a
 change in accountants.




Item 10.  Directors and Executive Officers
of the Registrant

Information concerning Dials Directors and Executive
Officers is set forth below and under the caption
Section 16(a) Beneficial Ownership Reporting
Compliance in our Proxy Statement relating to the 2000
Annual Meeting of Stockholders to be held on June 1, 2000,
(the Proxy Statement), which is incorporated by
reference into this Form 10-K. With the exception of this
foregoing information and other information specifically
incorporated by reference into this Form 10-K, the Proxy
Statement is not being filed as a part hereof.

|                            |  |     |    |          |  |                                                             
|--------------------------- |  | --- | -- | -------- |  | ------------------------------------------------------------
|Name                        |  | Age |    | Position
|                            |  |     |    |         
|Malcolm Jozoff(1)           |  |     | 60 |          |  | Chairman of the Board, President and Chief Executive Officer
|                           
|                           
|                           
|                           
|Susan J. Riley              |  |     | 41 |          |  | Executive Vice President and Chief Financial Officer        
|                           
|                           
|                           
|                           
|Jeffrey B. Dias             |  |     | 48 |          |  | Executive Vice President                                    
|                           
|                           
|                           
|                           
|Arthur E. Hanke             |  |     | 52 |          |  | Senior Vice President  Sales                               
|                           
|                           
|                           
|                           
|Jane E. Owens               |  |     | 46 |          |  | Senior Vice President, General Counsel and Secretary        
|                           
|                           
|                           
|                           
|Mark R. Shook               |  |     | 45 |          |  | Senior Vice President  International/ CMD                  
|                           
|                           
|                           
|                           
|Bernhard J. Welle           |  |     | 51 |          |  | Senior Vice President  Human Resources                     
|                           
|                           
|                           
|                           
|Joy A. Amundson(3)(5)       |  |     | 45 |          |  | Director                                                    
|                           
|                           
|                           
|                           
|Herbert M. Baum(1)(2)(3)    |  |     | 63 |          |  | Director                                                    
|                           
|                           
|                           
|                           
|Joe T. Ford(1)(2)(5)        |  |     | 62 |          |  | Director                                                    
|                           
|                           
|                           
|                           
|Thomas L. Gossage(2)(4)     |  |     | 65 |          |  | Director                                                    
|                           
|                           
|                           
|                           
|Donald E. Guinn(1)(3)(4)    |  |     | 67 |          |  | Director                                                    
|                           
|                           
|                           
|                           
|Michael T. Riordan(1)(3)(5) |  |     | 49 |          |  | Director                                                    
|                           
|                           
|                           
|                           
|Barbara S. Thomas (4)(5)    |  |     | 50 |          |  | Director                                                    
|                           
|                           
|                           
|                           
|Salvador M. Villar(2)(4)    |  |     | 49 |          |  | Director                                                    




|    |                                                
|--- | -----------------------------------------------
|(1) | Member of the Executive Committee.             
|   
|(2) | Member of the Audit Committee.                 
|   
|(3) | Member of the Executive Compensation Committee.
|   
|(4) | Member of the Finance Committee.               
|   
|(5) | Member of the Governance Committee.            

Malcolm Jozoff.Mr. Jozoff has been Chairman of the
Board, President and Chief Executive Officer of the Company since
 Dials formation in 1996. From 1993 to 1995,
Mr. Jozoff served as Chairman and Chief Executive Officer of
 Lenox, Inc., a manufacturer of consumer products. From 1967 to
1992, Mr. Jozoff was employed by The Procter & Gamble
Company, a manufacturer of consumer products. In 1990,
Mr. Jozoff was named President  Health Care
Sector and Corporate Group Vice President of Procter & Gamble
 and was appointed as a member of its Executive Committee.
Mr. Jozoff also is a director of Columbia Energy Group, the
Cosmetic, Toiletry and Fragrance Association and Grocery
Manufacturers of America.

Susan J. Riley. Ms. Riley has served as Executive
Vice President and Chief Financial Officer since
October 1999 and has additional responsibility for
Manufacturing, Procurement and Information Technology. From
September 1997 to October 1999, Ms. Riley served
as Senior Vice President and Chief Financial Officer

42



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##### Table of Contents





Jeffrey B. Dias.Mr. Dias has served as Executive
Vice President since October 1999 and has responsibilities
for Marketing, New Business and Research and Development. From
March 1999 to October 1999, he served as Senior Vice
President  Marketing and New Business. From
January 1998 to March 1999, Mr. Dias served as
President of The Singer Sewing Company, a manufacturer of sewing
appliances, and from January 1997 until March 1999, he
served as Senior Vice President of The Singer Company N.V., a
manufacturer and retailer of household appliances. From 1978 to
1996, Mr. Dias was employed in various management positions
in the health care, food, beverages and consumer products
divisions of The Procter & Gamble Company, a manufacturer of
paper products, with his last position being Managing
Director  Health Care Products  Worldwide.
In 1992, Mr. Dias served as the Category Manager 
 Oral Health Products for Blendax in Germany, a subsidiary of The
 Procter & Gamble Company.

Arthur E. Hanke. Mr. Hanke has served as Senior Vice
President  Sales of the Company since
January 1999. From September 1998 to January 1999,
 he served as Vice President  Corporate Sales of the
Company, and from the Spin-off to September 1998, he served
as Vice President  Customer Management of the Company.
 From 1991 to the Spin-off, Mr. Hanke served in various
capacities for the Consumer Products Business of the Former
Parent, including Vice President  Western Division
Grocery Sales, from 1991 to 1993; Vice President 
Broker Sales, from 1993 to 1994; Vice President 
Marketing, Detergents, from 1994 to 1995; and Senior Vice
President  Sales, Household Products Division, from
1995 to the Spin-off.

Jane E. Owens.Ms. Owens has served as Senior Vice
President, General Counsel & Secretary of the Company since
May 1997. From 1992 to May 1997, Ms. Owens served as
Vice President and General Counsel of The Timberland Company, a
manufacturer of footwear, apparel and accessories.

Mark R. Shook. Mr. Shook has served as Senior Vice
President  International & Commercial Markets
 since January 1998. From September 1996 to
January 1998, Mr. Shook served as Senior Vice
President  International of the Company. From the
Spin-off until September 1996, he was an Executive Vice President
 and General Manager, Personal Care, of the Company. From
September 1990 to the Spin-off, Mr. Shook was an
Executive Vice President of the Consumer Products Business of the
 Former Parent, serving as General Manager  Food, from
 September 1990 to September 1993; General
Manager  Food and International, from
September 1993 to April 1994; General Manager 
Laundry and International, from April to September 1994; General
Manager  Soaps and Detergents, from
September 1994 to July 1995; and General
Manager  Personal Care, from July 1995 to the
Spin-off.

Bernhard J. Welle. Mr. Welle has served as Senior
Vice President  Human Resources of the Company since
August 1996. From 1987 to August 1996, Mr. Welle served
 as Vice President, Human Resources of the Consumer Products
Business of the Former Parent.

Joy A. Amundson.Ms. Amundson has been a Director of
Dial since 1997, and is Senior Vice President of Abbott
Laboratories, a diversified health care products and services
company. Ms. Amundson also is President of Ross Products, a
division of Abbott Laboratories. She has held a number of
management positions since joining Abbott Laboratories in 1982.
Ms. Amundson also is a director of Lutheran General
Hospital.

Herbert M. Baum.Mr. Baum has been a Director of Dial
 since 1997, and is President and Chief Operating Officer of
Hasbro, Inc., a manufacturer and marketer of toys. Mr. Baum
served as Chairman and Chief Executive Officer of Quaker State
Corporation from 1993 to 1999. From 1978 to 1992, Mr. Baum
was employed by Campbell Soup Company and in 1992 was named
President of Campbell  North and South America.
Mr. Baum also is a director of Hasbro, Inc., Fleming
Companies, Inc., Meredith Corporation, Midas, Inc. and Whitman
Corporation.

43



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##### Table of Contents



Joe T. Ford.Mr. Ford has been a Director of Dial
since 1996, and is Chairman and Chief Executive Officer of ALLTEL
 Corporation, a telecommunications and information services
company. Mr. Ford became Chief Executive Officer of ALLTEL
in 1987 and Chairman of the Board in 1991. Mr. Ford also is a
director of Textron, Inc.

Thomas L. Gossage.Mr. Gossage has been a Director of
 Dial since 1996. Mr. Gossage retired as Chairman and Chief
Executive Officer of Hercules Incorporated, a worldwide producer
of chemicals and related products, in January 1997.
Mr. Gossage also is a director of Fluor Corporation and
Alliant Techsystems Inc.

Donald E. Guinn.Mr. Guinn has been a Director of
Dial since 1996, and is Chairman Emeritus of Pacific Telesis
Group, a telecommunications holding company (known as
PacTel). Mr. Guinn served as Chairman and Chief
Executive Officer of PacTel from 1984 through his retirement in
1988. He also is a director of Bank of America Corporation,
Pacific Mutual Holding Company and its affiliate, Pacific
LifeCorp.

Michael T. Riordan.Mr. Riordan has been a Director
of Dial since 1997. Mr. Riordan served as President and
Chief Operating Officer of Fort James Corporation, a paper
products manufacturer, from 1997 until 1998. Prior to the merger
of Fort Howard Corporation with James River Corporation,
Mr. Riordan served as Chairman of the Board, President and
Chief Executive Officer of Fort Howard Corporation from 1996 to
1997 and as President and Chief Operating Officer of Fort Howard
Corporation from 1992 to 1996. Mr. Riordan also is a
director of American Medical Security, Inc. and Wallace Computer
Services, Inc.

Barbara S. Thomas.Ms. Thomas has been a Director of
Dial since 1997, and is President of Warner-Lambert Consumer
Healthcare, the over-the-counter pharmaceuticals business of the
Warner-Lambert Company. Ms. Thomas was with the Pillsbury
Company from 1993 to 1997, serving last as President of Pillsbury
 Canada Ltd. Prior to joining Pillsbury, Ms. Thomas served
as Senior Vice President of Marketing for Nabisco Brands, Inc.

Salvador M. Villar.Mr. Villar has been a Director of
 Dial since June 1998. He is President and Chief Executive
Officer of California Commerce Bank, the U.S. banking arm of
Banco Nacional de México (known as Banamex).
Mr. Villar has been with California Commerce Bank since
1981. Mr. Villar also is President and Chief Executive
Officer of Banamex USA Bancorp and a director of California
Commerce Bank, Banamex USA Bancorp and Banco Bansud, S.A.




Item 11.  Executive Compensation

Information concerning executive compensation matters is
incorporated herein by reference to Executive
Compensation, Option/ SAR Grants in Last Fiscal
Year, Aggregated Stock Option Exercises in Last
Fiscal Year and Fiscal Year-End Option Values,
Pension Plans and Employment Agreements and
Change of Control Arrangements in the Proxy Statement;
provided, however, that the Compensation Committee Report
on Executive Compensation and the Stock Price
Performance Graph contained in the Proxy Statement are not
incorporated by reference herein.




Item 12.  Security Ownership of Certain
Beneficial Owners and Management

Information concerning the Common Stock beneficially owned by
each Director of the Company, by all Executive Officers and
Directors of the Company as a group and by each stockholder known
 by the Company to be the beneficial owner of more than 5% of the
 outstanding Common Stock is incorporated herein by reference to
Common Stock Ownership of Certain Beneficial Owners
and Common Stock Ownership of Directors and Executive
Officers in the Proxy Statement.




Item 13.  Certain Relationships and Related
Transactions

During the last fiscal year, there were no relationships or
related transactions that are required to be disclosed herein.

44



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##### Table of Contents






PART IV




Item 14.  Exhibits, Financial Statement
Schedules and Reports on Form 8-K

(a)  Financial Statements and Schedules

|     |  |                                                                                                                                                                                                                                                                     |  |                                                                                                                                                  |  |      |    | 
|---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---- | -- | 
|     |  |                                                                                                                                                                                                                                                                     |  |                                                                                                                                                  |  | Page
|     |  |                                                                                                                                                                                                                                                                     |  |                                                                                                                                                  |  |     
|(i)  |  | Financial Statements.                                                                                                                                                                                                                                               |  |                                                                                                                                                  |  |     
|    
|    
|    
|    
|     |  | (1)                                                                                                                                                                                                                                                                 |  | Managements Report on Responsibility for Financial
	Reporting                                                                                   |  |      | 20 | 
|    
|    
|    
|    
|     |  | (2)                                                                                                                                                                                                                                                                 |  | Independent Auditors Report                                                                                                                     |  |      | 21 | 
|     |  | (3)                                                                                                                                                                                                                                                                 |  | Consolidated Financial Statements:                                                                                                               |  |      |    | 
|    
|    
|    
|    
|     |  |                                                                                                                                                                                                                                                                     |  | Consolidated Balance Sheet at December 31, 1999, and
	December 31, 1998                                                                          |  |      | 22 | 
|    
|    
|    
|    
|     |  |                                                                                                                                                                                                                                                                     |  | Statement of Consolidated Operations and Comprehensive Income for
	 the years ended December 31, 1999, December  31, 1998,
	 and January 3, 1998 |  |      | 23 | 
|    
|    
|    
|    
|     |  |                                                                                                                                                                                                                                                                     |  | Statement of Consolidated Cash Flows for the years ended
	December 31, 1999, December 31, 1998, and
	January 3, 1998                             |  |      | 24 | 
|    
|    
|    
|    
|     |  |                                                                                                                                                                                                                                                                     |  | Statement of Consolidated Stockholders Equity for the years
	 ended December 31, 1999, December 31, 1998, and
	January  3, 1998                 |  |      | 25 | 
|    
|    
|    
|    
|     |  |                                                                                                                                                                                                                                                                     |  | Notes to Consolidated Financial Statements                                                                                                       |  |      | 26 | 
|(ii) |  | Financial Statement Schedules.                                                                                                                                                                                                                                      |  |                                                                                                                                                  |  |     
|     |  | Schedules have been omitted because of the absence of conditions under which they are required or because the required material information is included in the consolidated financial statements
or notes to the consolidated financial statements included herein. |  |                                                                                                                                                  |  |     

(b)  Reports on Form 8-K

We filed a Current Report on Form 8-K, dated
February 1, 2000, reporting that Dial issued a press release
 relating to its financial results for the fourth quarter of 1999
 and the 1999 fiscal year, a copy of which was filed as
Exhibit 99.

We also filed a Current Report on Form 8-K dated
March 10, 2000, reporting that Dial issued a press release
relating to its financial earnings outlook for the first half of
2000, a copy of which was filed as Exhibit 99.

(c)  Exhibits

|        |       |             |  |                                                                   |  |                                                                                                                  
|------- | ----- | ----------- |  | ----------------------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------
|Exhibit |       |             |  |                                                                  
|Number  |       | Description |  | Method of Filing                                                 
|        |       |             |  |                                                                  
|        | 3(a)  |             |  | Restated Certificate of Incorporation of the Company              |  | Incorporated by reference to Exhibit 3(a) of Dials
	Form 10/A (Am. No. 2), dated July 26, 1996 (the
	Form 10).
|        | 3(b)  |             |  | Bylaws of the Company                                             |  | Incorporated by reference to Exhibit 3(b) of Dials
	Form 10-Q for the quarter ended July 4, 1998.               
|        | 4(a)  |             |  | Form of Rights Agreement between the Company and the Rights Agent |  | Incorporated by reference to Exhibit 4 of the Form 10.                                                           
|        | 10(a) |             |  | Directors Indemnification Agreement                             |  | Incorporated by reference to Exhibit 10(a) of Dials
	Form 10-Q, dated November 11, 1996 (the
	Form 10-Q).     
|        | 10(b) |             |  | Officers Indemnification Agreement                              |  | Incorporated by reference to Exhibit 10(b) of the
	Form 10-Q.                                                    

45



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##### Table of Contents



|        |       |             |  |                                                                                              |  |                                                                                                                                      
|------- | ----- | ----------- |  | -------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |       |             |  |                                                                                             
|Number  |       | Description |  | Method of Filing                                                                            
|        |       |             |  |                                                                                             
|        | 10(c) |             |  | Supplemental Capital Accumulation Plan Agreement                                            |  | Incorporated by reference to Exhibit 10(c) of the
	Form 10-Q.                                                                        
|        | 10(d) |             |  | Supplemental Pension Plan Agreement                                                         |  | Incorporated by reference to Exhibit 10(d) of the
	Form 10-Q.                                                                        
|        | 10(e) |             |  | The Dial Corporation 1996 Stock Incentive Plan.                                             |  | Incorporated by reference to Exhibit  10(e) of
	Dials Form 10-K for the fiscal year ended
	December 31, 1998 (the 1998 Form 10-K).
|        | 10(f) |             |  | Annual Incentive Plan Agreement                                                             |  | Incorporated by reference to Exhibit 10(f) of Dials
	Form 10-K for the fiscal year ended December 28, 1996.                         
|        | 10(g) |             |  | Form of The Dial Corporation Directors Charitable Award
	Program                           |  | Incorporated by reference to Exhibit 10(f) of the
	Form 10.                                                                          
|        | 10(h) |             |  | Form of Change of Control Agreements with certain Executive
	Officers of the Company        |  | Incorporated by reference to Exhibit 10(h) of the 1998
	Form 10-K.                                                                   
|        | 10(i) |             |  | Credit Agreement                                                                             |  | Incorporated by reference to Exhibit 10(j) of the
	Form 10.                                                                          
|        | 10(j) |             |  | Form of The Dial Corporation Employee Equity Trust                                           |  | Incorporated by reference to Exhibit 10(k) of the
	Form 10.                                                                          
|        | 10(k) |             |  | The Dial Corporation Amended and Restated Directors Deferred
	Compensation Plan             |  | Incorporated by reference to Exhibit 4.5 of Dials
	Registration Statement in Form  S-8 (File
	No. 333-67619) (the Form  S-8).     
|        | 10(l) |             |  | The Dial Corporation Amended and Restated Management Deferred
	Compensation Plan            |  | Incorporated by reference to Exhibit 4.4 of the
	Form S-8.                                                                           
|        | 10(m) |             |  | Restated Employment Agreement, dated May  11, 1999, between
	the Company and Malcolm Jozoff |  | Incorporated by reference to Exhibit 10(a) of Dials
	Form 10-Q dated August 17, 1999 (the Second
	Quarter 1999 10-Q).             
|        | 10(n) |             |  | Change of Control Agreement, dated May 11, 1999, between
	Dial and Malcolm Jozoff           |  | Incorporated by reference to Exhibit 10(b) of the Second
	Quarter 1999 10-Q.                                                         
|        | 21    |             |  | List of Significant Subsidiaries*                                                            |  |                                                                                                                                      
|        | 23    |             |  | Consent of Deloitte & Touche LLP*                                                            |  |                                                                                                                                      
|        | 24    |             |  | Power of Attorney                                                                            |  | See Signature Page.                                                                                                                  
|        | 27    |             |  | Financial Data Schedule*                                                                     |  |                                                                                                                                      








|  |                
|- | ---------------
|* | Filed herewith.

46



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##### Table of Contents



SIGNATURES

Pursuant to the requirements of Section 13 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, in Scottsdale, Arizona, on March 29, 2000.



| |                     
| | --------------------
| | THE DIAL CORPORATION



| |     |                  
| | --- | -----------------
| | By: | /s/MALCOLM JOZOFF

| |                                 
| | --------------------------------
| |                                 
| | Malcolm Jozoff                  
| | Chairman of the Board, President
| | and Chief Executive Officer     

KNOW ALL PERSONS BY THESE PRESENT that the persons whose
signatures appear below, constitute and appoint Malcolm Jozoff
and Susan J. Riley, and each of them, as their true and
lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for them and in their names,
places and steads, in any and all capacities, to sign the Annual
Report on Form 10-K for the fiscal year ended
December 31, 1999, and any and all amendments to the
Form 10-K, and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the Securities
and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every
act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as they might or
could do in person, thereby ratifying and confirming all that
said attorney-in-fact and agent, or any of them, or their or his
or her substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

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 and in the capacities and on the
dates indicated.

|                                       |  |                                                                                                                      |  |               
|-------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------- |  | --------------
|Signature                              |  | Title                                                                                                                |  | Date          
|                                       |  |                                                                                                                      |  |               
|/s/ MALCOLM JOZOFFMalcolm Jozoff       |  | Chairman of the Board, President and Chief Executive Officer
	(Principal Executive Officer)                          |  | March 29, 2000
|/s/ SUSAN J. RILEYSusan J. Riley       |  | Executive Vice President and Chief Financial Officer (Principal
	Financial Officer and Principal Accounting Officer) |  | March 29, 2000
|/s/ JOY A. AMUNDSONJoy A. Amundson     |  | Director                                                                                                             |  | March 29, 2000
|/s/ HERBERT M. BAUMHerbert M. Baum     |  | Director                                                                                                             |  | March 29, 2000
|/s/ JOE T. FORDJoe T. Ford             |  | Director                                                                                                             |  | March 29, 2000
|/s/ THOMAS L. GOSSAGEThomas L. Gossage |  | Director                                                                                                             |  | March 29, 2000
|/s/ DONALD E. GUINNDonald E. Guinn     |  | Director                                                                                                             |  | March 29, 2000

47



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|                                         |  |          |  |               
|---------------------------------------- |  | -------- |  | --------------
|Signature                                |  | Title    |  | Date          
|                                         |  |          |  |               
|/s/ MICHAEL T. RIORDANMichael T. Riordan |  | Director |  | March 29, 2000
|/s/ BARBARA S. THOMASBarbara S. Thomas   |  | Director |  | March 29, 2000
|/s/ SALVADOR M. VILLARSalvador M. Villar |  | Director |  | March 29, 2000

48



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EXHIBIT INDEX

|        |       |             |  |                                                                                              |  |                                                                                                                                      
|------- | ----- | ----------- |  | -------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |       |             |  |                                                                                             
|Number  |       | Description |  | Method of Filing                                                                            
|        |       |             |  |                                                                                             
|        | 3(a)  |             |  | Restated Certificate of Incorporation of the Company                                         |  | Incorporated by reference to Exhibit 3(a) of Dials
	Form 10/ A (Am. No. 2), dated July 26, 1996 (the
	Form 10).                   
|        | 3(b)  |             |  | Bylaws of the Company                                                                        |  | Incorporated by reference to Exhibit 3(b) of Dials
	Form 10-Q for the quarter ended July 4, 1998.                                   
|        | 4(a)  |             |  | Form of Rights Agreement between the Company and the Rights Agent                            |  | Incorporated by reference to Exhibit 4 of the Form 10.                                                                               
|        | 10(a) |             |  | Directors Indemnification Agreement                                                        |  | Incorporated by reference to Exhibit 10(a) of Dials
	Form 10-Q, dated November 11, 1996 (the
	Form 10-Q).                         
|        | 10(b) |             |  | Officers Indemnification Agreement                                                         |  | Incorporated by reference to Exhibit 10(b) of the
	Form 10-Q.                                                                        
|        | 10(c) |             |  | Supplemental Capital Accumulation Plan Agreement                                            |  | Incorporated by reference to Exhibit 10(c) of the
	Form 10-Q.                                                                        
|        | 10(d) |             |  | Supplemental Pension Plan Agreement                                                         |  | Incorporated by reference to Exhibit 10(d) of the
	Form 10-Q.                                                                        
|        | 10(e) |             |  | The Dial Corporation 1996 Stock Incentive Plan.                                             |  | Incorporated by reference to Exhibit  10(e) of
	Dials Form 10-K for the fiscal year ended
	December 31, 1998 (the 1998 Form 10-K).
|        | 10(f) |             |  | Annual Incentive Plan Agreement                                                             |  | Incorporated by reference to Exhibit 10(f) of Dials
	Form 10-K for the fiscal year ended December 28, 1996.                         
|        | 10(g) |             |  | Form of The Dial Corporation Directors Charitable Award
	Program                           |  | Incorporated by reference to Exhibit 10(f) of the
	Form 10.                                                                          
|        | 10(h) |             |  | Form of Change of Control Agreements with certain Executive
	Officers of the Company        |  | Incorporated by reference to Exhibit 10(h) of the 1998
	Form 10-K.                                                                   
|        | 10(i) |             |  | Credit Agreement                                                                             |  | Incorporated by reference to Exhibit 10(j) of the
	Form 10.                                                                          
|        | 10(j) |             |  | Form of The Dial Corporation Employee Equity Trust                                           |  | Incorporated by reference to Exhibit 10(k) of the
	Form 10.                                                                          
|        | 10(k) |             |  | The Dial Corporation Amended and Restated Directors Deferred
	Compensation Plan             |  | Incorporated by reference to Exhibit 4.5 of Dials
	Registration Statement in Form  S -8 (File
	No. 333-67619) (the Form  S-8).    
|        | 10(l) |             |  | The Dial Corporation Amended and Restated Management Deferred
	Compensation Plan            |  | Incorporated by reference to Exhibit 4.4 of the
	Form S-8.                                                                           
|        | 10(m) |             |  | Restated Employment Agreement, dated May  11, 1999, between
	the Company and Malcolm Jozoff |  | Incorporated by reference to Exhibit 10(a) of Dials
	Form 10-Q dated August 17, 1999 (the Second
	Quarter 1999 10-Q).             
|        | 10(n) |             |  | Change of Control Agreement, dated May 11, 1999, between
	Dial and Malcolm Jozoff           |  | Incorporated by reference to Exhibit 10(b) of the Second
	Quarter 1999 10-Q.                                                         
|        | 21    |             |  | List of Significant Subsidiaries*                                                            |  |                                                                                                                                      



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##### Table of Contents



|        |    |             |  |                                   |  |                    
|------- | -- | ----------- |  | --------------------------------- |  | -------------------
|Exhibit |    |             |  |                                  
|Number  |    | Description |  | Method of Filing                 
|        |    |             |  |                                  
|        | 23 |             |  | Consent of Deloitte & Touche LLP* |  |                    
|        | 24 |             |  | Power of Attorney                 |  | See Signature Page.
|        | 27 |             |  | Financial Data Schedule*          |  |                    




|  |                                                         
|- | --------------------------------------------------------
| | Management contract or compensatory plan or arrangement.



|  |                
|- | ---------------
|* | Filed herewith.