<PAGE>
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
FORM 10-Q
(Mark One)
[X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended May 26, 2000
OR
[_]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File No. 1-13873
----------------
STEELCASE INC.
Michigan 38-0819050
(State of incorporation) (I.R.S. Employer Identification No.)
901 44th Street Grand Rapids, Michigan 49508
(Address of principal executive (Zip Code)
offices)
(616) 247-2710
Registrant's telephone number, including area code
----------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes [X] No [_]
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of Common stock, as of the latest practicable date: As of June 23, 2000, the
Registrant had outstanding 30,319,547 shares of Class A Common Stock and
119,848,478 shares of Class B Common Stock.
Exhibit index located on page number 15.
-------------------------------------------------------------------------------
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<PAGE>
STEELCASE INC. FORM 10-Q
FOR THE QUARTER ENDED MAY 26, 2000
INDEX
<TABLE>
<CAPTION>
Page
No.
----
<S> <C>
Part I. Financial Information
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Statements of Income for the
Three Months Ended May 26, 2000 and May 28, 1999....................... 3
Condensed Consolidated Balance Sheets
as of May 26, 2000 and February 25, 2000............................... 4
Condensed Consolidated Statements of Cash Flows for the
Three Months Ended May 26, 2000 and May 28, 1999....................... 5
Notes to Condensed Consolidated Financial Statements.................... 6-8
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.................................................... 9-12
Item 3. Quantitative and Qualitative Disclosures About Market Risk....... 12
Part II. Other Information
Item 1. Legal Proceedings................................................ 13
Item 2. Changes in Securities............................................ 13
Item 3. Defaults upon Senior Securities.................................. 13
Item 4. Submission of Matters to a Vote of Security Holders.............. 13
Item 5. Other Information................................................ 13
Item 6. Exhibits and Reports on Form 8-K................................. 13
Signatures................................................................ 14
Exhibit Index............................................................. 15
</TABLE>
2
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
STEELCASE INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(in millions, except per share data)
<TABLE>
<CAPTION>
Three Months Ended
---------------------
May 26, May 28,
2000 1999
--------- ---------
<S> <C> <C>
Net sales.............................................. $ 944.7 $ 691.8
Cost of sales.......................................... 619.8 438.4
--------- ---------
Gross profit........................................... 324.9 253.4
Selling, general and administrative expenses........... 226.9 170.7
--------- ---------
Operating income....................................... 98.0 82.7
Interest expense....................................... (8.7) (1.0)
Other income, net...................................... 14.2 5.4
--------- ---------
Income before provision for income taxes and equity in
net income
(loss) of joint ventures and dealer transitions....... 103.5 87.1
Provision for income taxes............................. 40.4 32.7
--------- ---------
Income before equity in net income (loss) of joint
ventures and dealer transitions....................... 63.1 54.4
Equity in net income (loss) of joint ventures and
dealer transitions.................................... (0.5) 2.3
--------- ---------
Net income............................................. $ 62.6 $ 56.7
========= =========
Earnings per share (basic and diluted)................. $ 0.41 $ 0.37
========= =========
Dividends per share of common stock.................... $ 0.11 $ 0.11
========= =========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
3
<PAGE>
STEELCASE INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions)
<TABLE>
<CAPTION>
(Unaudited)
May 26, Feb. 25,
ASSETS 2000 2000
------ ----------- --------
<S> <C> <C>
Current assets:
Cash and cash equivalents................................... $ 57.3 $ 73.7
Accounts receivable, net.................................... 605.9 592.6
Notes receivable and leased assets.......................... 219.9 189.0
Inventories................................................. 172.6 166.5
Other current assets........................................ 125.7 105.5
-------- --------
Total current assets.................................. 1,181.4 1,127.3
Property and equipment, net................................... 930.7 939.1
Notes receivable and leased assets............................ 316.4 294.1
Joint ventures and dealer transitions......................... 36.3 37.0
Goodwill and other intangible assets, net..................... 409.4 422.6
Other assets ................................................. 223.7 217.5
-------- --------
Total assets.......................................... $3,097.9 $3,037.6
======== ========
<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
<S> <C> <C>
Current liabilities:
Accounts and notes payable.................................. $ 222.5 $ 219.8
Short-term borrowings and current portion of long-term
debt....................................................... 257.2 209.0
Accrued expenses:
Employee compensation..................................... 115.3 121.1
Employee benefit plan obligations......................... 65.6 90.0
Other..................................................... 305.9 287.3
-------- --------
Total current liabilities............................. 966.5 927.2
-------- --------
Long-term liabilities:
Long-term debt.............................................. 265.1 257.8
Employee benefit plan obligations........................... 231.7 243.7
Other long-term liabilities................................. 44.9 46.7
-------- --------
Total long-term liabilities........................... 541.7 548.2
-------- --------
Total liabilities..................................... 1,508.2 1,475.4
-------- --------
Shareholders' equity:
Common stock................................................ 335.5 342.7
Accumulated other comprehensive income (loss)............... (44.3) (33.0)
Retained earnings........................................... 1,298.5 1,252.5
-------- --------
Total shareholders' equity............................ 1,589.7 1,562.2
-------- --------
Total liabilities and shareholders' equity............ $3,097.9 $3,037.6
======== ========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
4
<PAGE>
STEELCASE INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(in millions)
<TABLE>
<CAPTION>
Three Months Ended
---------------------
May 26, May 28,
2000 1999
--------- ---------
<S> <C> <C>
OPERATING ACTIVITIES
Net income.............................................. $ 62.6 $ 56.7
Depreciation and amortization........................... 37.5 26.0
Changes in current assets and liabilities, net of
corporate acquisitions................................. (70.2) (46.0)
Other, net.............................................. 0.1 15.8
--------- ---------
Net cash provided by operating activities............. 30.0 52.5
--------- ---------
INVESTING ACTIVITIES
Capital expenditures.................................... (60.2) (33.3)
Proceeds from the disposal of assets.................... 47.9 --
Corporate acquisitions, net of cash acquired............ -- (177.8)
Net increase in notes receivable and leased assets...... (53.4) (39.7)
Other, net.............................................. (19.1) (1.9)
--------- ---------
Net cash used in investing activities................. (84.8) (252.7)
--------- ---------
FINANCING ACTIVITIES
Proceeds from issuance of long-term debt................ 41.5 41.0
Repayments of debt...................................... (30.0) --
Short-term borrowings, net.............................. 52.9 160.0
Common stock repurchase................................. (7.2) (3.7)
Dividends paid.......................................... (16.6) (16.9)
--------- ---------
Net cash provided by financing activities............. 40.6 180.4
--------- ---------
Effect of exchange rate changes on cash and cash
equivalents.......................................... (2.2) --
--------- ---------
Net increase (decrease) in cash and cash
equivalents........................................ (16.4) (19.8)
Cash and cash equivalents, beginning of period.... 73.7 67.5
--------- ---------
Cash and cash equivalents, end of period.......... $ 57.3 $ 47.7
========= =========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
5
<PAGE>
STEELCASE INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals and adjustments)
considered necessary for a fair presentation of the condensed consolidated
financial statements have been included. Results for interim periods should
not be considered indicative of results to be expected for a full year.
Reference should be made to the consolidated financial statements contained in
the registrant's Annual Report on Form 10-K for the fiscal year ended February
25, 2000 (the "10-K Report"). For purposes hereof, "Steelcase Inc." or the
"Company" means Steelcase Inc. and its majority owned subsidiaries unless the
context requires otherwise.
Earnings Per Share
The following table reconciles the numerator and denominators used in the
calculations of basic and diluted earnings per share ("EPS") (in millions):
<TABLE>
<CAPTION>
Three Months
Ended
---------------
May 26, May 28,
2000 1999
------- -------
<S> <C> <C>
Numerator:
Net income numerator for both basic and diluted EPS........ $ 62.6 $ 56.7
====== ======
Denominators:
Denominator for basic EPS--Weighted average common shares
outstanding............................................... 150.9 153.6
Potentially dilutive shares resulting from stock options... 0.1 0.2
------ ------
Denominator for diluted EPS................................ 151.0 153.8
====== ======
</TABLE>
Comprehensive Income
Comprehensive income is comprised of net income and all changes to
shareholders' equity, except those due to investments by owners and
distributions to owners. Comprehensive income and its components consist of
the following (in millions):
<TABLE>
<CAPTION>
Three Months
Ended
----------------
May 26, May 28,
2000 1999
------- -------
<S> <C> <C>
Net income................................................. $ 62.6 $56.7
Other comprehensive income:
Foreign currency translation adjustments................. (10.9) (8.8)
Unrealized gain (loss) on investments.................... (0.4) 2.0
------ -----
Comprehensive income....................................... $ 51.3 $49.9
====== =====
</TABLE>
6
<PAGE>
STEELCASE INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
(Unaudited)
Inventories
Inventories are stated at the lower of cost or market. Inventories are
valued based upon the last-in, first-out ("LIFO") method and the average cost
method.
Inventories consist of (in millions):
<TABLE>
<CAPTION>
May 26, Feb 25,
2000 2000
------- -------
<S> <C> <C>
Finished goods.............................................. $ 80.4 $ 71.6
Work in process............................................. 45.8 45.6
Raw materials............................................... 90.5 93.4
------ ------
216.7 210.6
LIFO reserve................................................ (44.1) (44.1)
------ ------
$172.6 $166.5
====== ======
</TABLE>
Inventories determined by the LIFO method aggregated $123.4 million and
$121.3 million at May 26, 2000 and February 25, 2000, respectively.
Long-Term Debt
During the first quarter of fiscal 2001, the Company entered into
additional borrowing arrangements of $38.7 million, which mature from 2004 to
2006 and have a weighted average interest rate of 6.92%. The borrowings are
fully collateralized by lease receivables and certain leased assets.
Common Stock Repurchase Program
On June 17, 1998, the Company's Board of Directors ("Board") approved a
common stock repurchase program authorizing the repurchase of up to three
million shares of common stock. On September 22, 1999, the Board authorized
additional common stock repurchases of up to three million shares. During the
first quarter of fiscal 2001, the Company repurchased 396,200 Class A common
shares and 207,400 Class B common shares at a cost of $4.7 million and $2.5
million, respectively. As of May 26, 2000, total repurchases amounted to $58.9
million; 2,141,830 shares remain available for repurchase under the program
and the Company has outstanding commitments to repurchase 386,800 of those
remaining shares.
7
<PAGE>
STEELCASE INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
(Unaudited)
Operating Segments
The Company's principal business is the manufacture of an extensive range
of steel and wood office furniture products. Primary product lines include
office furniture systems, seating, storage solutions, desk and casegoods, and
interior architectural products. In addition, the Company also provides
services and is engaged in non-furniture businesses, which include marine
accessories and design, financial services and consulting services. The
Company operates on a worldwide basis within three reportable segments, two of
which are geographic furniture segments, and services and other businesses.
The Company evaluates performance and allocates resources based on operating
income.
The following sets forth reportable segment data reconciled to the
consolidated financial statements (in millions):
<TABLE>
<CAPTION>
Three Months
Ended
-----------------
May 26, May 28,
2000 1999
-------- --------
<S> <C> <C>
Net sales
North America............................................ $ 732.2 $ 634.0
International............................................ 167.8 175.3
Services and other businesses............................ 44.7 30.8
Eliminations............................................. -- (148.3)
-------- --------
Consolidated net sales................................... $ 944.7 $ 691.8
======== ========
<CAPTION>
Three Months
Ended
-----------------
May 26, May 28,
2000 1999
-------- --------
<S> <C> <C>
Operating income
North America............................................ $ 83.6 $ 78.2
International............................................ 8.8 11.4
Services and other businesses............................ 5.6 3.5
Eliminations............................................. -- (10.4)
-------- --------
Consolidated operating income............................ $ 98.0 $ 82.7
======== ========
<CAPTION>
May 26, Feb. 25,
2000 2000
-------- --------
<S> <C> <C>
Total assets
North America............................................ $1,662.0 $1,678.2
International............................................ 678.4 679.2
Services and other businesses............................ 757.5 680.2
Eliminations............................................. -- --
-------- --------
Consolidated total assets................................ $3,097.9 $3,037.6
======== ========
</TABLE>
The three months ended May 28, 1999 include the results of Steelcase
Strafor on a consolidated basis, which are eliminated in order to reconcile
with the Company's consolidated totals.
8
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The following discussion of the Company's financial condition and results
of operations should be read in conjunction with the accompanying Condensed
Consolidated Financial Statements of the Company and Management's Discussion
and Analysis of Financial Condition and Results of Operations set forth in the
10-K Report.
Results of Operations
The following table sets forth condensed consolidated statement of income
data for the three months ended May 26, 2000 and May 28, 1999.
<TABLE>
<CAPTION>
Three Months
Ended
---------------
May 26, May 28,
2000 1999
------- -------
<S> <C> <C>
Net sales................................................... 100.0% 100.0%
Cost of sales............................................... 65.6 63.4
----- -----
Gross profit................................................ 34.4 36.6
Selling, general and administrative expenses................ 24.0 24.6
----- -----
Operating income............................................ 10.4 12.0
Interest expense............................................ (0.9) (0.1)
Other income, net........................................... 1.5 0.7
----- -----
Income before provision for income taxes and equity in net
income (loss)
of joint ventures and dealer transitions................... 11.0 12.6
Provision for income taxes.................................. 4.3 4.7
----- -----
Income before equity in net income (loss) of joint ventures
and dealer transitions..................................... 6.7 7.9
Equity in net income (loss) of joint ventures and dealer
transitions................................................ (0.1) 0.3
----- -----
Net income.................................................. 6.6% 8.2%
===== =====
</TABLE>
--------
Overview
Consolidated net sales of $944.7 million for the first quarter of fiscal
2001 ("Q1 2001") increased 36.6% compared to the first quarter of fiscal 2000
("Q1 2000"), primarily attributable to the impact of the acquisition of
Steelcase Strafor S.A. and subsidiaries ("Steelcase Strafor") and other
domestic acquisitions. However, sales growth excluding acquisitions was 11.2%
bolstered by new product sales and broad-based strengthening across most
product lines. The Company posted earnings growth of 10.4% in Q1 2001 with net
income of $62.6 million ($0.41 per share), including a $5.4 million ($0.04 per
share) after-tax gain on the sale of a non-operating facility, compared to net
income of $56.7 million ($0.37 per share) in Q1 2000.
9
<PAGE>
Three Months Ended May 26, 2000 Compared to the Three Months Ended May 28,
1999
The following table sets forth comparative sales information by segment (in
millions):
<TABLE>
<CAPTION>
Three Months
Ended Percentage
--------------- Change
May 26, May 28, Increase/
2000 1999 (Decrease)
------- ------- ----------
<S> <C> <C> <C>
Net sales
North America..................................... $732.2 $634.0 15.5%
International (1)................................. 167.8 27.0 n/m
Services & other businesses....................... 44.7 30.8 45.1%
------ ------ ----
Consolidated net sales............................ $944.7 $691.8 36.6%
====== ====== ====
</TABLE>
--------
n/m = not meaningful
(1) Because of the effective date of the acquisition, Steelcase Strafor net
sales of $148.3 million for Q1 2000 are not included in the chart above.
Q1 2001 consolidated net sales increased 36.6% primarily as a result of the
acquisition of Steelcase Strafor and other domestic acquisitions. The sales
growth of 11.2%, excluding acquisitions, was primarily due to increases in new
product sales, a rebound in sales of the core "Steelcase" branded products and
the Steelcase Design Partnership ("SDP") continuing its strong rate of sales
growth during the quarter. New product sales, defined as products introduced
in the past five years, made up 23% of the current quarter's sales mix. The
increase in the core business was linked to the rebound in the Company's large
account business which significantly strengthened during the quarter compared
to last year.
The Company continues to sustain double-digit order growth across most
product lines within North America, outpacing the industry during the
comparable time period. Therefore, the Company expects its strong sales
performance to continue at least through the first half of the fiscal year.
The Business and Institutional Furniture Manufacturers' Association ("BIFMA")
has increased its growth forecast to 5% to 7% from 4% to 6% for calendar year
2000.
Within International operations, orders and sales strengthened within the
quarter as European sales were up 7% in local currency compared to Q1 2000.
The devaluation of the euro negatively impacted sales by approximately $18
million. The net result was a sales decrease of 5% for the quarter in US
dollars.
Services and other businesses primarily increased as a result of increased
sales at Attwood and consulting and design revenues from IDEO, as well as
increased net leasing revenues from Steelcase Financial Services, Inc.
("SFSI").
The decrease in gross profit margin of 2.2 percentage points for the
current quarter over quarter comparison was a continuation of the same factors
affecting the Company's recent performance -- the negative impact of continued
industry-wide competitive pricing pressures, along with a shift in the
Company's sales mix from traditional products with higher margins to new
products with lower initial margins and the consolidation of the Company's
European operations.
The selling, general and administrative expense ratio of net sales
decreased from 24.6% in Q1 2000 to 24.0% in Q1 2001. The decrease was
primarily attributable to the Company's ability to leverage sales growth. Cost
control measures continue to be successful across the Company, but the Company
continues to make focused investments in its technology initiatives and
investments designed to leverage its global capabilities.
10
<PAGE>
Interest expense increased from $1.0 million in Q1 2000 to $8.7 million in
Q1 2001. Q1 2000 was the first quarter the Company reported debt, specifically
related to the European acquisition. The increase is primarily due to the
borrowings against the Company's lease receivable portfolio to fund further
lease activity, as well as significant cash outlays during Q1 2001. Other
income, net increased $8.8 million compared to Q1 2000, primarily as a result
of the pre-tax gain of $8.8 million on the sale of a non-operating facility.
The effective income tax rate in Q1 2001 was 39.0% as compared to 37.5% for
Q1 2000. The increase in the effective rate is due to the European
acquisition, which had two effects. First, overall European tax rates tend to
be higher than domestic rates. Second, the non-deductibility of the
intangibles associated with the acquisition increased the effective rate.
Equity in net income from joint ventures and dealer transitions decreased
to $(0.5) million in Q1 2001 from $2.3 million in Q1 2000, primarily as a
result of the Company's European operations now being consolidated with the
Company's results.
For the reasons set forth above, net income increased 10.4% to $62.6
million in Q1 2001 from $56.7 million in Q1 2000.
Liquidity and Capital Resources
Historically, the Company's cash and capital requirements have been
satisfied through cash generated from operating activities. The Company's
financial position at May 26, 2000, includes cash and cash equivalents of
$57.3 million. These funds, in addition to cash generated from future
operations and available credit facilities, are expected to be sufficient to
finance the known or foreseeable future liquidity and capital needs of the
Company.
The principal change in cash generated from operating activities for Q1
2001 compared to Q1 2000 is attributable to the Company's European operations,
which have increased both accounts receivable and inventories. The Company,
however, is developing strategies to aggressively pursue opportunities to
reduce both on a worldwide basis. In addition, the Company had significant
cash outlays for previously accrued expenses.
Cash used in investing activities now encompasses the change in leased
assets of the Company's wholly-owned finance subsidiary, SFSI. SFSI's asset
base continues to grow as SFSI increases its portfolio of leased assets, asset
based lending and project financing. Capital expenditures were $60.2 million
in Q1 2001 compared to $33.3 million in Q1 2000. The Company is investing in
the construction of a new wood manufacturing facility as well as investments
focused on improving the Company's production processes and in the Company's
"configure to order" SAP business system. The Company's investments are
intended to improve productivity and safety, increase capacity, decrease the
impact on the environment and facilitate the launch of new services and
products. Management expects capital expenditures, net of asset dispositions,
to approximate $200 million for the full fiscal year. During Q1 2001, the
Company received proceeds of $47.9 million related to the completion of two
sale/leaseback transactions and the sale of a non-operating facility.
The Company paid common stock dividends of $0.11 per share, or $16.6
million, and $0.11 per share, or $16.9 million, during Q1 of 2001 and 2000,
respectively. During Q1 2001, the Company repurchased 396,200 Class A common
shares for $4.7 million and 207,400 Class B common shares for $2.5 million,
under a three million share repurchase program authorized by the Board of
Directors on June 17, 1998 and amended on September 22, 1999 for an additional
three million shares. Management anticipates that the stock repurchase program
will not reduce the Company's tradable share float in the long run as it
expects that Class B common shares will continue to convert into Class A
common shares over time.
11
<PAGE>
Euro Conversion
On January 1, 1999, eleven of the fifteen member countries of the European
Union established fixed conversion rates between their existing sovereign
currencies and the euro. There will be a transition period from January 1,
1999 through January 1, 2002, at which time all legal tender will convert to
the euro. The transition period is anticipated to resolve difficulties in
handling local currencies and euro simultaneously, while remaining flexible to
the market. The Company's primary exposure to the euro conversion is
concentrated in Steelcase Strafor. Steelcase Strafor created an internal Euro
Committee, a pan-European multifunctional team whose goal was to determine the
impact of this currency change on products, markets, and information systems.
Based on the Euro Committee's work to date, the Company does not expect the
euro conversion to have a material impact on Steelcase Strafor's financial
position, or on the Company as a whole.
Safe Harbor Provision
There are certain forward-looking statements under the Three Months Ended
May 26, 2000 Compared to the Three Months Ended May 28, 1999, Liquidity and
Capital Resources and Euro Conversion sections, particularly those with
respect to the sales performance of the Company continuing through the first
half of the fiscal year, the Company's future liquidity and capital needs, the
sufficiency of the Company's current and future cash and cash equivalents to
finance future liquidity and capital needs, future capital expenditures,
conversion of Class B common shares to Class A common shares, and the impact
of the euro conversion on the financial position of Steelcase Strafor and the
Company. Such statements involve certain risks and uncertainties that could
cause actual results to vary from stated expectations. The Company's
performance may differ materially from that contemplated by such statements
for a variety of reasons, including, but not limited to, competitive and
general economic conditions domestically and internationally; competitive
pricing pressure; currency fluctuations; changes in customer order patterns;
sales mix; the success of new products and their impact on the Company's
manufacturing processes; the Company's ability to improve margins on new
products, to successfully integrate acquired businesses, to reduce costs,
including ramp up costs associated with new products, to reduce accounts
receivable and inventories associated with the Company's European operations,
and to successfully implement technology initiatives; the impact of the euro
conversion, the sufficiency of the reserve established with regard to material
and installation costs associated with Pathways product line improvements and
other risks detailed in the Company's 10-K Report for the year ended February
25, 2000, and its other filings with the Securities and Exchange Commission.
Recently Issued Accounting Standards
The Statement of Financial Accounting Standards ("SFAS") No. 133,
Accounting for Derivative Instruments and Hedging Activities (as amended),
establishes accounting and reporting standards for derivative instruments,
requiring recognition of the fair value of all derivatives as assets or
liabilities on the balance sheet. Gains and losses resulting from changes in
fair value would be included in income, or in comprehensive income, depending
on whether the instrument qualifies for hedge accounting and the type of hedge
instrument involved. The statement is effective for fiscal years beginning
after June 15, 2000. Management intends to adopt the provisions of SFAS No.
133 during the Company's fiscal year 2002. The impact of this pronouncement on
the Company's financial results is currently being evaluated. No other recent
accounting pronouncements are expected to have a material impact on the
Company's financial statements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Foreign Exchange Risks
During the first quarter of fiscal 2001, no material change in foreign
exchange risks occurred.
Interest Rates
During the first quarter of fiscal 2001, no material change in interest
rates occurred.
12
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
1. EXHIBITS
See Exhibit Index
2. REPORTS ON FORM 8-K
No reports on Form 8-K were filed during the three months ended May 26,
2000.
13
<PAGE>
SIGNATURES
Pursuant to the requirements 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.
Steelcase Inc.
/s/ Alwyn Rougier-Chapman
_____________________________________
Alwyn Rougier-Chapman
Senior Vice President--Finance
and Chief Financial Officer (Duly
Authorized Officer and Principal
Financial Officer)
Date: July 10, 2000
14
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Designation Description
----------- -----------
<C> <S>
3.2 Amended By-laws of the Company, as amended June 15, 2000
10.7 Steelcase Inc. 1994 Executive Supplemental Retirement Plan,
amended and restated
as of June 1, 2000
10.14 Second Amendment to the Steelcase Inc. Incentive Compensation Plan
27.1 Financial Data Schedule, for the three months ended May 26, 2000
</TABLE>
15
