<PAGE>
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 April 30, 1996
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR
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
________________________________________________________________________________
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
11,896,704, net of treasury shares.
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CASCADE CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF INCOME AND RETAINED EARNINGS
(unaudited - in thousands, except per share figures)
<TABLE>
<CAPTION>
Three months ended
April 30,
-----------------------
1996 1995
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<S> <C> <C>
Net sales $ 57,010 $ 57,150
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Costs and expenses:
Cost of goods sold 37,345 37,595
Depreciation 2,685 2,515
Selling and administrative expenses 9,915 9,695
Environmental expense 438
--------- ----------
49,945 50,243
--------- ----------
Operating income 7,065 6,907
Interest expense 211 283
Interest income (236) (178)
Other expense, net 360 162
--------- ----------
Income before income taxes 6,730 6,640
Income taxes 2,340 2,350
--------- ----------
Net income 4,390 4,290
Retained earnings, beginning of period 85,083 79,910
Cash dividends (1,071) (1,081)
--------- ----------
Retained earnings, end of period $ 88,402 $ 83,119
========= ==========
Net income per share $ .37 $ .36
========= ==========
Dividends per share $ .09 $ .09
========= ==========
(Weighted average shares outstanding) 11,990,447 12,009,904
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
PART 1
CONSOLIDATED BALANCE SHEET Fiscal
(in thousands) Year ended
April 30 January 31
1996 1996
---------- ----------
(unaudited)
Assets
Current assets:
Cash and cash equivalents $ 20,573 $ 23,326
Accounts receivable, less allowance
for doubtful accounts of $747 and $967 36,924 38,574
Inventories, at average cost
which is lower than market:
Finished goods and components 16,753 16,142
Goods in process 4,071 4,083
Raw materials 5,055 4,990
---------- ----------
25,879 25,215
Prepaid expenses 617 849
---------- ----------
Total current assets 83,993 87,964
Property, plant and equipment, at cost less
accumulated depreciation 63,287 63,214
Deferred income taxes 86 58
Other assets 2,029 1,954
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Total assets $ 149,395 $ 153,190
========== ==========
Liabilities and Shareholders' Equity
Current liabilities:
Notes payable to banks $ 5,810 $ 5,015
Current portion of long-term debt 2,078 2,940
Accounts payable 14,417 17,126
Accrued payroll and payroll taxes 4,554 5,654
Other accrued expenses 2,516 6,418
Income taxes 2,533 982
---------- ----------
Total current liabilities 31,908 38,135
Long-term debt 9,209 9,531
Accrued environmental expenditures 10,500 10,500
Other liabilities 3,001 2,967
---------- ----------
Total liabilities 54,618 61,133
---------- ----------
Shareholders' equity:
Common stock, $.50 par value,
authorized 20,000,000 shares-
issued 12,278,208 shares 6,139 6,139
Additional paid-in capital 568 568
Retained earnings 88,402 85,083
Cumulative foreign currency
translation adjustments 354 953
Treasury stock, at cost
(381,504 shares common) (686) (686)
---------- ----------
Total shareholders' equity 94,777 92,057
Total liabilities and ---------- ----------
shareholders' equity $ 149,395 $ 153,190
========== ==========
*For the three months ended April 30, 1996, the cumulative translation
adjustment account reflects a debit of $599 resulting from translation
adjustments.
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited - in thousands) Three months ended
April 30
-----------------------
1996 1995
--------- ----------
Cash flows from operating activities:
Net income $ 4,390 $ 4,290
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Depreciation 2,685 2,515
Deferred income taxes (25) (484)
Changes in operating assets and liabilities:
Accounts receivable 1,650 (4,953)
Inventories (664) (3,335)
Prepaid expenses 232 215
Account payable and accrued expenses (7,711) (4,758)
Income taxes 1,551 1,390
Other liabilities 34 23
--------- ----------
Cash provided by (used in) operations 2,142 (5,097)
--------- ----------
Cash flows from investing activities:
Acquisition of property, plant and equipment (3,519) (3,566)
Other assets (75) 26
--------- ----------
Net cash used in investing activities (3,594) (3,540)
--------- ----------
Cash flows from financing activities:
Long-term debt, including current portion (937) 7,663
Notes payable to banks 795 1,253
Cash dividends (1,071) (1,081)
--------- ----------
Net cash (used in) provided by financing activities (1,213) 7,835
--------- ----------
Effect of exchange rate changes (88) 1,089
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(Decrease) increase in cash and cash equivalents (2,753) 287
Cash and cash equivalents at
beginning of year 23,326 17,203
--------- ----------
Cash and cash equivalents at end of period $ 20,573 $ 17,490
========= ==========
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest $ 205 $ 283
Income taxes $ 821 $ 1,224
</TABLE>
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - RECLASSIFICATIONS
Certain reclassifications have been made to January 31, 1996 amounts to conform
with the April 30, 1996 presentation. Such reclassifications had no impact on
previously reported results of operations or shareholder's equity.
<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 April 30, 1996 were
$57,010,000 as compared to sales of $57,150,000 for the first quarter of 1995.
Net income for the first quarter of 1996 of $4,390,000 ($.37 per share)
represents an increase of 2.3% compared to net income of $4,290,000 ($.36 per
share) for the corresponding 1995 period.
Shipments during the first quarter were negatively affected by two events in
North America. A power transformer failure in the Portland plant caused the
loss of several days of production in late April and a major original equipment
manufacturer rescheduled deliveries of a substantial quantity of masts to later
in the year as a result of its heavy inventories and relocation to a new plant
facility. While the production lost to the power problem has since been
recovered, the Westminster, South Carolina Mast plant will operate at lower
volumes than expected for at least the next two quarters. North American
bookings remain strong, although they have not matched the record levels of
previous quarters. Business conditions in most European countries have
strengthened and our sales in the first quarter increased by 8.2% over last
year's comparable quarter. Sales in Japan are also up substantially over last
year. Pricing has not been a significant factor in sales volume changes.
The Company created a special reserve of $12,000,000 in the fourth quarter of
1995 in anticipation of future expenses associated with environmental
investigation and remediation activities which may be incurred over a period of
up to 30 years. We remain confident that the Company will recover all or a
substantial portion of these past and future costs from our liability insurers,
against whom legal action is presently proceeding. As a result, environmental
expenditures beginning in the current year are charged against this reserve
rather than to current operations as was the case in prior years.
The net income increase reflects continued strong expense control throughout the
company along with improved operating performance in Europe.
During the fourth quarter of 1995 the Company announced its intention to
repurchase up to 400,000 shares of its common stock. Subsequent to quarter end,
we acquired 120,000 shares, bringing the total repurchased to 233,200 shares at
an average cost of $14.80.
In our financial consolidations, the U.S. dollar strengthened modestly against
the European currencies during the quarter, continuing the trend. Since the
comparable quarter in 1995, the Dutch Guilder and British Pound have weakened by
9.4% and 6.4% respectively. As a result, the adjustment for currency
translation in our financial statements reflects a decrease of $599,000 ($.05
per share) in shareholders' equity for the current quarter and year to date.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
Capital expenditures of $3,519,000 have been recorded during the first quarter,
approximately equal to the $3,566,000 recorded during the corresponding period
in 1995. Planned capital expenditures for 1996 of $19,325,000 include
$4,400,000 for a major addition, renovation and consolidation of our Portland
office. It was anticipated that work would begin on this project in the first
quarter, but due to delays associated with obtaining permits, ground breaking
has been rescheduled for late second quarter 1996. This and other capital
expenditures are directed at productivity and quality improvements as well as
introduction of new products.
No significant shifts occurred in the balance sheet during the quarter. The
Company's total long and short-term debt to equity ratio was .18 to 1.00 and
working capital approximated $52,100,000 at April 30, 1996. Our strong cash
position, together with our available borrowing capacity, is more than
sufficient to meet our short-term requirements.
<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
June 7, 1996 /s/ James P. Miller
-------------- ----------------------------
Date James P. Miller
Vice President - Finance
Secretary and Treasurer
<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 enviromental litigation
or litigation incidental to the regualr 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 April 30, 1996, the company was not required
to file a Form 8-K with the commission.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-31-1997
<PERIOD-START> FEB-01-1996
<PERIOD-END> APR-30-1996
<CASH> 20,573
<SECURITIES> 0
<RECEIVABLES> 37,671
<ALLOWANCES> 747
<INVENTORY> 25,879
<CURRENT-ASSETS> 83,993
<PP&E> 135,586
<DEPRECIATION> 72,299
<TOTAL-ASSETS> 149,395
<CURRENT-LIABILITIES> 31,908
<BONDS> 0
0
0
<COMMON> 6,139
<OTHER-SE> 88,638
<TOTAL-LIABILITY-AND-EQUITY> 149,395
<SALES> 57,010
<TOTAL-REVENUES> 57,010
<CGS> 37,345
<TOTAL-COSTS> 37,345
<OTHER-EXPENSES> 360
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 211
<INCOME-PRETAX> 6,730
<INCOME-TAX> 2,340
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,390
<EPS-PRIMARY> .37
<EPS-DILUTED> .37
</TABLE>
