<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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 July 31, 1995
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER 2-23666
CASCADE CORPORATION
AN OREGON CORPORATION
I.R.S. Employer Identification Number 93-0136592
2020 S.W. 4th Avenue
Portland, Oregon 97201
(503) 227-0024
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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 ______
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date: common shares
outstanding 12,009,904, net of treasury shares.
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF INCOME AND RETAINED EARNINGS
(in thousands, except per share and average share figures)
<TABLE>
<CAPTION>
Three months ended Six months ended
July 31 July 31
-------------------- -------------------
1995 1994 1995 1994
------- ------- -------- -------
<S> <C> <C> <C> <C>
Net sales $58,650 $45,500 $115,800 $86,350
------- ------- -------- -------
Costs and expenses:
Cost of goods sold, excluding depreciation 38,270 29,280 75,865 55,335
Depreciation 2,530 2,175 5,045 4,100
Selling and administrative expenses 9,785 8,955 19,480 17,815
Interest expense, net 70 (75) 175 25
Other expense, net 690 455 1,290 1,040
------- ------- -------- -------
51,345 40,790 101,855 78,315
------- ------- -------- -------
Income before taxes 7,305 4,710 13,945 8,035
Income taxes 2,700 1,665 5,050 2,835
------- ------- -------- -------
Net income 4,605 3,045 8,895 5,200
------- ------- -------- -------
Retained earnings, beginning of period 83,119 76,516 79,910 75,262
Cash dividends (1,081) (901) (2,162) (1,802)
------- ------- -------- -------
Retained earnings, end of period $86,643 $78,660 $ 86,643 $78,660
------- ------- -------- -------
------- ------- -------- -------
Net income per share $ .38 $ .25 $ .74 $ .43
------- ------- -------- -------
------- ------- -------- -------
Dividends per share $ .09 $ .075 $ .18 $ .15
------- ------- -------- -------
------- ------- -------- -------
</TABLE>
(Based on 12,009,904 common shares outstanding)
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
PART 1
CONSOLIDATED BALANCE SHEET
(in thousands)
<TABLE>
<CAPTION>
Fiscal
Year ended
July 31, January 31
1995 1995
-------- ----------
<S> <C> <C>
Assets
Current assets:
Cash and cash equivalents $ 22,963 $ 17,203
Accounts receivable, less allowance for doubtful
accounts of $285 and $265 41,998 35,277
Inventories, at average cost which is lower than market:
Finished goods and components 15,866 13,934
Goods in process 3,630 3,148
Raw materials 5,120 3,985
-------- --------
24,616 21,067
Income taxes 151
Prepaid expenses 937 919
-------- --------
Total current assets 90,514 74,617
Property, plant and equipment, at cost less accumulated
depreciation 64,708 60,607
Other assets 1,841 1,885
-------- --------
Total assets $157,063 $137,109
-------- --------
-------- --------
Liabilities and Shareholders' Equity
Current liabilities:
Notes payable to banks $ 8,972 $ 5,812
Current portion of long-term debt 712 243
Accounts payable 15,440 16,149
Accrued payroll and payroll taxes 4,782 4,227
Other accrued expenses 4,148 7,365
Income taxes 2,257
-------- --------
Total current liabilities 36,311 33,796
Long-term debt 16,191 7,809
Deferred income taxes 3,674 4,058
Other liabilities 2,933 2,908
-------- --------
Total liabilities 59,109 48,571
-------- --------
Shareholders' equity:
Common stock, $.50 par value, authorized 20,000,000
shares -- issued 12,391,408 shares 6,196 6,196
Additional paid-in capital 2,045 2,045
Retained earnings 86,643 79,910
Cumulative foreign currency translation adjustments 3,756 1,073
Treasury stock, at cost (381,504 shares common) (686) (686)
-------- --------
Total shareholders' equity 97,954 88,538
-------- --------
Total liabilities and shareholders' equity $157,063 $137,109
-------- --------
-------- --------
<FN>
* For the six months ended July 31, 1995, the cumulative translation
adjustment account reflects a credit of $2,683 resulting from translation
adjustments.
</TABLE>
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(in thousands)
<TABLE>
<CAPTION>
Six months ended
July 31
----------------------
1995 1994
------- -------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 8,895 $ 5,200
Adjustments to reconcile net income to net cash
(used in) provided by operating activities:
Depreciation 5,045 4,100
Deferred income taxes (484) (13)
Changes in operating assets and liabilities:
Accounts receivable (6,721) (6,404)
Inventories (3,549) (840)
Prepaid expenses (18) (331)
Account payable and accrued expenses (3,371) 909
Income taxes 2,408 775
Other liabilities 25 37
------- -------
Net cash provided by operations 2,230 3,433
------- -------
Cash flows from investing activities:
Acquisition of property, plant and equipment (6,406) (9,792)
Other assets 44 (97)
------- -------
Net cash used in investing activities (6,362) (9,889)
------- -------
Cash flows from financing activities:
Long-term debt, including current portion 8,109 6,474
Notes payable to banks 3,160 2,136
Cash dividends (2,162) (1,802)
------- -------
Net cash provided by financing activities 9,107 6,808
------- -------
Effect of exchange rate changes 785 745
------- -------
Increase in cash and cash equivalents 5,760 1,097
Cash and cash equivalents at beginning of year 17,203 12,617
------- -------
Cash and cash equivalents at end of period $22,963 $13,714
------- -------
------- -------
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest $ 575 $ 134
Income taxes $ 2,931 $ 4,232
</TABLE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Consolidated net sales for the three months ended July 31, 1995 were a record
high $58,650,000, an increase of 29% when compared to sales of $45,500,000
for the second quarter of 1994. Net income for the second quarter of 1995 of
$4,605,000 (.38 per share) was also a record, and represents an increase of
51% compared to net income of $3,045,000 ($.25 per share) for the
corresponding 1994 period.
For the six months ended July 31, 1995, consolidated net sales of
$115,800,000 reflect a 34% increase over sales of $86,350,000 for the
corresponding prior year period. Net income for the six months of $8,895,000
($.74 per share) was 71% greater than the comparable $5,200,000 ($.43 per
share) net income for the first six months of 1994. Expressed as a return on
sales, net income represents a 7.9% return for the second quarter and 7.7%
return for the first six months. Please note that the per share amounts used
throughout this report are based on the number of shares outstanding after
the 100% stock dividend that was distributed to our shareholders on March 15,
1995.
The solid sales gains recorded during both the second quarter and first six
months are the result of several positive factors. In North America we have
experienced a significant 28% year-to-year increase reflecting the continuing
high level of lift truck shipments in the U.S. and Canadian markets. Business
conditions throughout most of Europe are strengthening, and our European
operations enjoyed a very substantial 46% sales increase over the prior year.
It should be noted that about two-thirds of this 46% increase represents
actual sales growth, while about one-third of this increase is due to the
effect of currency exchange rates associated with the relatively weak U.S.
dollar. Sales in Japan have shown a modest improvement, and we are pleased to
report that export sales to our customers in Latin America and to Cascade
distributors in Australia and Southeast Asia have increased by 40% over last
year.
The record high net income reflects the increased sales volume, improved
operating performance at our new manufacturing plant in The Netherlands,
successful cost reduction efforts involving a major product line and
excellent expense control throughout the Company.
Other expense for the first six months of 1995 and 1994 includes charges of
$870,000 and $750,000 respectively, associated with environmental evaluations
and remediation activities. As previously reported, the Company has initiated
legal action against a number of insurers to enforce the terms of their
policies and to recover the Company's costs.
<PAGE>
In our financial consolidations the U.S. dollar strengthened modestly against
most foreign currencies, reversing some of the weakness from the first
quarter. However, for the six months ended July 31, 1995 the U.S. dollar has
weakened nearly 13% against the Japanese Yen and 10% against the Dutch
Guilder. As a result, the adjustment for currency translation in our
financial statements reflects a decrease of $389,000 ($.03 per share) for the
current quarter and an increase of $2,683,000 ($.22 per share) for the six
months ended July 31, 1995.
LIQUIDITY AND CAPITAL RESOURCES
Over the preceding five years, expenditures for new facilities, machinery,
equipment and tooling have exceeded $50,000,000. Capital expenditures of
$6,406,000 have been recorded during the first six months of this fiscal
year. This is lower than the $9,792,000 recorded during the corresponding
period in 1994. A significant portion of the 1994 additions were expenditures
for the project to consolidate the production facilities of our Diemen and
Amelo factories and our European offices into one facility at Almere, The
Netherlands. Funding for this project was obtained from a bank in The
Netherlands. Other capital improvements have been funded from earnings.
No significant shifts occurred in the balance sheet during the quarter. The
Company's total long and short-term debt to equity ratio was .26 to 1.00 and
working capital approximated $54,200,000 at July 31, 1995.
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
PART II
ITEM 1. LEGAL PROCEEDINGS
Neither the Company nor any of its subsidiaries are involved in any
material pending legal proceedings other than litigation incidental
to the regular course of business. The company and its subsidiaries
are adequately insured against product liability, personal injury
and property damage claims which may arise occasionally.
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. EXHIBIT AND REPORTS ON FORM 8-K
During the quarter ended July 31, 1995, the company was not required
to file a Form 8-K with the commission.
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
SIGNATURES
The enclosed financial statements have not been certified by independent
accountants. However, to the best of my knowledge and belief these financial
statements have been prepared in conformity with generally accepted
accounting principles and on a basis substantially consistent with audited
financial statements included in the annual report filed with the Commission
for the preceding fiscal year.
The Company believes that all adjustments, consisting of normal
recurring adjustments, necessary for a fair statement of the results of
operations, have been included.
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.
CASCADE CORPORATION
8/28/95 /s/ G. M. BITZ
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Date G. M. Bitz
Vice President -- Finance
and Secretary
8/28/95 /s/ JAMES P. MILLER
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Date James P. Miller
Treasurer
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JAN-31-1996
<PERIOD-START> FEB-01-1995
<PERIOD-END> JUL-31-1995
<CASH> 22,963
<SECURITIES> 0
<RECEIVABLES> 42,283
<ALLOWANCES> 285
<INVENTORY> 24,616
<CURRENT-ASSETS> 90,514
<PP&E> 135,233
<DEPRECIATION> 70,526
<TOTAL-ASSETS> 157,063
<CURRENT-LIABILITIES> 36,311
<BONDS> 0
<COMMON> 6,196
0
0
<OTHER-SE> 91,758
<TOTAL-LIABILITY-AND-EQUITY> 157,063
<SALES> 115,800
<TOTAL-REVENUES> 115,800
<CGS> 75,865
<TOTAL-COSTS> 100,390
<OTHER-EXPENSES> 1,290
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 175
<INCOME-PRETAX> 13,945
<INCOME-TAX> 5,050
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,895
<EPS-PRIMARY> .74
<EPS-DILUTED> .74
</TABLE>
