<PAGE>
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 March 31, 1995
--------------
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______________________ to _____________________
Commission File No. 1-3560
------
P. H. GLATFELTER COMPANY
- - --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Pennsylvania 23-0628360
- - --------------------------------------------------------------------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
228 South Main Street, Spring Grove, Pennsylvania 17362
- - --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(717) 225-4711
--------------
(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
------ ------
Shares of Common Stock outstanding at May 9, 1995 were 44,207,641.
<PAGE>
P. H. GLATFELTER COMPANY
INDEX
Part I - Financial Information
- - ------------------------------
Financial Statements:
Condensed Consolidated Statements of Income and Retained
Earnings - Three Months Ended March 31, 1995 and 1994
(Unaudited)............................................ 2
Condensed Consolidated Balance Sheets - March 31, 1995
(Unaudited) and December 31, 1994...................... 3
Condensed Consolidated Statements of Cash Flows - Three
Months Ended March 31, 1995 and March 31, 1994
(Unaudited)............................................ 4
Notes to Condensed Consolidated Financial Statements...... 5-6
Independent Accountant's Report........................... 7
Management's Discussion and Analysis of Financial Condition
and Results of Operations................................. 8-10
Part II - Other Information..................................... 11
- - ---------------------------
Signature....................................................... 12
- - ---------
Index of Exhibits............................................... 13
Exhibit 11 - Computation of Net Income Per Share............. 14
Exhibit 15 - Letter in Lieu of Consent Regarding Review
Report of Unaudited Interim Financial
Information..................................... 15
Exhibit 27 - Financial Data Schedule......................... 16
<PAGE>
PART I - FINANCIAL INFORMATION
------------------------------
P. H. GLATFELTER COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
(in thousands except number of shares and per share amounts)
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
3/31/95 3/31/94
----------- -----------
<S> <C> <C>
Net Sales $ 155,037 $ 110,815
Other income - net
Energy sales - net 1,616 1,510
Interest on investments and other - net 286 420
Gain from property dispositions,
etc., - net 189 17
----------- -----------
Total 157,128 112,762
Costs and expenses
Cost of products sold 125,099 102,021
Selling, general and administrative
expenses 8,833 7,079
Interest on debt - net 2,723 751
----------- -----------
Total 136,655 109,851
Income before income taxes 20,473 2,911
Income tax provision
Current taxes 3,572 49
Deferred taxes 4,387 828
----------- -----------
Total 7,959 877
Net income 12,514 2,034
Retained earnings at beginning of period 396,635 545,770
----------- -----------
Total 409,149 547,804
----------- -----------
Common stock dividends declared 7,745 7,706
----------- -----------
Retained earnings at end of period $ 401,404 $ 540,098
=========== ===========
Weighted average number of common shares
outstanding 44,384,994 44,187,116
Net income per common share $.28 $.05
=========== ===========
Dividends declared per common share $.175 $.175
=========== ===========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
2
<PAGE>
P. H. GLATFELTER COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
ASSETS
------
<TABLE>
<CAPTION>
3/31/95 12/31/94
(unaudited)
--------- ----------
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 4,731 $ 3,133
Marketable securities 111 111
Accounts receivable - net 57,467 48,912
Inventories:
Raw materials 24,884 28,894
In process and finished products 22,806 24,202
Supplies 29,931 28,735
--------- ---------
Total inventory 77,621 81,831
Prepaid expenses and other current assets 2,860 1,382
--------- ---------
Total current assets 142,790 135,369
Plant, equipment and timberlands - net 453,702 460,420
Other assets 57,397 55,021
--------- ---------
Total assets $ 653,889 $ 650,810
========= =========
</TABLE>
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
<TABLE>
<CAPTION>
Current liabilities:
<S> <C> <C>
Short-term bank borrowings $ 23,400 $ 24,100
Accounts payable 35,989 44,309
Dividends payable 7,745 7,735
Federal, state and local taxes 4,897 2,489
Accrued compensation, other expenses
and deferred income taxes 24,583 25,639
--------- ---------
Total current liabilities $ 96,614 $ 104,272
Long-term debt 150,000 150,000
Deferred income taxes 64,536 60,313
Other long-term liabilities 41,278 40,491
Commitments and contingencies
Shareholders' equity:
Common stock 544 544
Capital in excess of par value 40,068 39,838
Retained earnings
401,404 396,635
Total --------- ---------
442,016 437,017
Less cost of common treasury stock (140,555) (141,283)
--------- ---------
Total shareholders' equity 301,461 295,734
Total liabilities and
shareholders' equity $ 653,889 $ 650,810
========= =========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
3
<PAGE>
P. H. GLATFELTER COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
3/31/95 3/31/94
-------- --------
<S> <C> <C>
Cash Flows from Operating Activities:
Net income $ 12,514 $ 2,034
Items included in net income not using (providing)
cash:
Depreciation and depletion 8,270 10,748
Loss (gain) on disposition of fixed assets (14) 266
Expense related to employee stock purchase plans 229 201
Change in assets and liabilities:
Accounts receivable (8,555) (5,033)
Inventories 4,210 4,044
Prepaid expenses and other assets (3,854) (2,660)
Accounts payable, accrued compensation,
other expenses, deferred income taxes
and other long-term liabilities (1,943) (11,601)
Federal, state and local taxes 2,408 (823)
Deferred income taxes - non-current 4,223 807
-------- --------
Net cash provided by (used in) operating activities 17,488 (2,017)
-------- --------
Cash Flows from Investing Activities:
Sale (purchase) of marketable securities and
long-term investments - 20,570
Proceeds from disposal of fixed assets 26 271
Additions to plant, equipment and timberlands (3,216) (16,087)
Decrease in liabilities related to
fixed asset acquisitions (4,995) (4,451)
-------- --------
Net cash provided by (used in) investing activities (8,185) 303
-------- --------
Cash Flows from Financing Activities:
Repayment of short-term debt (700) -
Dividends paid (7,735) (7,698)
Employees' contribution - common stock issued
under employee stock purchase plans and key
employee long-term incentive plan 730 557
-------- --------
Net cash used in financing activities (7,705) (7,141)
-------- --------
Net increase (decrease) in cash and cash equivalents 1,598 (8,855)
Cash and Cash Equivalents:
At beginning of period 3,133 19,182
-------- --------
At end of period $ 4,731 $ 10,327
======== ========
Supplemental Disclosure of Cash Flow Information:
Cash paid for:
Interest (net of amount capitalized) $ 4,431 $ 2,629
Income taxes 2,272 961
</TABLE>
See accompanying notes to condensed consolidated financial statements.
4
<PAGE>
P. H. GLATFELTER COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. A reconciliation between the income tax provision computed by applying the
statutory federal income tax rate of 35% to income before income taxes, and
the actual income tax provision follows:
<TABLE>
<CAPTION>
Three Months Ended
3/31/95 3/31/94
-------- --------
<S> <C> <C>
Federal income tax provision at
statutory rate $ 7,166 $ 1,019
State income taxes after deducting
Federal income tax benefit 877 128
Other (84) (270)
-------- --------
Actual income tax provision $ 7,959 $ 877
======== ========
</TABLE>
The deferred income tax provision for the three-month periods ended March
31, 1995 and 1994 results from the following temporary differences (in
thousands):
<TABLE>
<CAPTION>
Three Months Ended
3/31/95 3/31/94
-------- --------
<S> <C> <C>
Depreciation $ 4,569 $ 1,886
Pensions 847 489
Alternative Minimum Tax (791) (1,106)
Other (238) (441)
-------- -------
$ 4,387 $ 828
======== =======
</TABLE>
The provision for deferred income taxes is, in part, estimated based on an
allocation of the appropriate amount relative to the number of months
reported herein and in conformance with existing tax regulations.
2. The number of shares of common stock outstanding increased by 53,512 in the
first three months of 1995. This increase was due to the issuance of
51,421 treasury shares pursuant to the various Employee Stock Purchase
Plans of the Company and the net issuance of 2,091 treasury shares pursuant
to the Registrant's 1992 Key Employee Long-Term Incentive Plan. At March
31, 1995, 10,108,639 shares of common stock were held in treasury.
3. The Registrant's Board of Directors has authorized the repurchase in the
open market or in privately negotiated transactions of up to 10,000,000
shares of the Registrant's common stock in the aggregate. Repurchased
shares are added to the treasury and are available for future sale. Under
these authorizations, as of March 31, 1995, the Registrant had repurchased
8,998,030 shares for a total consideration of $149,523,823.
4. Pursuant to the Registrant's 1992 Key Employee Long-Term Incentive Plan
(the "Plan"), on May 1, 1995, the Registrant granted to certain key
employees non-qualified stock options to purchase an aggregate of 229,660
shares of common stock. Of this amount, stock options for 224,660 shares
of common stock, subject to certain conditions, are exercisable for 25% of
such common stock beginning on January 1, 1996 and for an additional 25% of
such common stock beginning on January 1, of each of the next three years.
Subject to certain conditions, the remaining 5,000 stock options are
exercisable beginning on November 1, 1995. All of the stock options, which
expire on April 30, 2005, were granted at an exercise price of $17.8125 per
share, representing the average fair market value of the Registrant's
common stock on May 1, 1995.
Also pursuant to the Plan and subject to certain conditions, on May 1,
1995, the Registrant awarded 59,620 shares to certain key employees to be
issued in whole or in part depending on the Registrant's degree of success
in achieving certain performance goals during the period from January 1,
1995 to December 31, 1998.
5
<PAGE>
5. The Registrant is subject to loss contingencies resulting from regulation
by various federal, state, local and foreign governmental authorities with
respect to the environmental impact of air and water emissions and noise
from its mills as well as its disposal of solid waste generated by its
operations. In order to comply with environmental laws and regulations,
the Registrant has incurred substantial capital and operating expenditures
over the past several years. The Registrant anticipates that environmental
regulation of the Registrant's operations will continue to become more
burdensome and that capital and operating expenditures to comply with such
environmental regulation will continue, and perhaps increase, in the
future. In addition, the Registrant may incur obligations to remove or
mitigate any adverse effects on the environment resulting from its
operations, including the restoration of natural resources, and liability
for personal injury and damage to property, including natural resources.
Because other paper companies located in the United States are generally
subject to the same environmental regulations, the Registrant does not
believe that its competitive position in the United States paper industry
will be materially adversely affected by any obligations it will incur or
the limitations which environmental compliance may place on its operations.
The amount and timing of future expenditures for environmental compliance,
clean-up, remediation and personal injury and property damage liability
cannot be ascertained with any certainty due, among other things, to the
unknown extent and nature of any contamination, the extent and timing of
any technological advances for pollution control, the remedial actions
which may be required and the number and financial resources of any other
responsible parties. The Registrant continues to evaluate its exposure and
the level of its reserves. Management's current assessment, after
consultation with legal counsel, is that such expenditures are not likely
to have a material adverse effect on the Registrant's financial condition,
results of operations or liquidity, but there can be no assurance that its
reserves will be adequate or that such an effect will not occur at some
future time.
6. In the opinion of the Registrant, the accompanying unaudited condensed
consolidated financial statements contain all adjustments (which comprise
only normal recurring accruals) necessary for a fair presentation of the
financial information contained therein. These unaudited condensed
consolidated financial statements should be read in conjunction with the
more complete disclosures contained in the Company's Annual Report on Form
10-K for the year ended December 31, 1994. The accompanying unaudited
condensed consolidated financial statements have been reviewed by the
Registrant's independent public accountants, Deloitte & Touche LLP, in
accordance with the established professional standards and procedures for
such limited review. No additional adjustments or disclosures were
required as a result of this review.
6
<PAGE>
INDEPENDENT ACCOUNTANTS' REPORT
-------------------------------
P. H. Glatfelter Company:
We have reviewed the accompanying condensed consolidated balance sheet of P. H.
Glatfelter Company and subsidiaries as of March 31, 1995, and the related
condensed consolidated statements of income and retained earnings and of cash
flows for the three-month periods ended March 31, 1995 and 1994. These
financial statements are the responsibility of the Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to such condensed consolidated financial statements for them to be in
conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of P. H. Glatfelter Company and
subsidiaries as of December 31, 1994, and the related consolidated statements of
income and retained earnings and of cash flows for the year then ended (not
presented herein); and in our report dated February 10, 1995, we expressed an
unqualified opinion on those consolidated financial statements. In our opinion,
the information set forth in the accompanying condensed consolidated balance
sheet as of December 31, 1994 is fairly stated, in all material respects, in
relation to the consolidated balance sheet from which it has been derived.
Deloitte & Touche LLP
Philadelphia, Pennsylvania
April 17, 1995, except for
Note 4 as to which the date
is May 1, 1995
7
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
------------------------------------------------
RESULTS OF OPERATIONS:
- - ---------------------
A summary of the period-to-period changes in the principal items included in the
consolidated statements of income is shown below.
<TABLE>
<CAPTION>
Comparison of Three Months Ended
March 31, 1995 and March 31, 1994
---------------------------------
Increase
(dollars in thousands)
<S> <C> <C>
Net sales $44,222 39.9%
Other income - net 144 7.4%
Cost of products sold 23,078 22.6%
Selling, general and
administrative expenses 1,754 24.8%
Interest on debt - net 1,972 262.6%
Income tax provision 7,082 807.5%
Net income 10,480 515.2%
</TABLE>
Net Sales
- - ---------
The Registrant classifies product sales into two groups: 1) printing papers; and
2) tobacco and other specialty papers. Net sales increased by $44,222,000, or
39.9%, for the first three months of 1995 compared to the corresponding period
of 1994.
Printing paper net sales increased $42,465,000, or 51.9%, for the first three
months of 1995 compared to the first three months of 1994. Printing paper sales
volume and average net selling price increased by 28.9% and 17.9%, respectively,
in the first three months of 1995 compared to the same period in 1994.
A significant increase in printing paper demand led to the increase in sales
volume in the first quarter of 1995. In contrast, during the first three months
of 1994, insufficient demand within the paper industry, as well as extreme
weather conditions, led to approximately eight days and thirteen days of
unplanned downtime at the Registrant's Spring Grove, Pennsylvania and Neenah,
Wisconsin mills, respectively.
Printing paper selling prices increased in 1995 over 1994 due to the increase in
customer demand, as well as the ability to offset increased raw material costs,
particularly for market pulp, pulp substitutes and wastepaper.
Net sales of tobacco and other specialty papers were 8.4% higher in the first
three months of 1995 compared to the first three months of 1994 due to an
increase in the average net selling price. The average net selling price
increase was due primarily to the ability of the Registrant to pass through
increased market pulp costs.
Cost of Products Sold
- - ---------------------
The Registrant's gross margin increased from 7.9% for the first three months of
1994 to 19.3% for the first three months of 1995. This increase was due to
higher average net selling prices and a decrease in cost of products sold per
ton. The average cost of products sold per ton decreased due to the fact that
the Registrant's fixed costs for its manufacturing process were absorbed over
more tons of products manufactured during the first three months of 1995. The
average cost of products sold per ton also decreased due to a decline in
depreciation expense of approximately $2,500,000 for the first three months of
1995 compared to the first three months of 1994. Increased depreciation expense
at the Spring Grove and Neenah mills was more than offset by the reduced
depreciation expense for the Ecusta Division of approximately $3,500,000 for the
first three months of 1995 compared to the corresponding period in 1994. This
decrease resulted from the writedown of the net assets of the Ecusta Division in
the fourth quarter of 1994. The effect of the increase in tons manufactured and
lower depreciation expense was offset somewhat by higher costs for market pulp,
pulp substitutes and wastepaper.
8
<PAGE>
As a result of the reduction of depreciation expense, increased net sales and
the favorable impact of cost reduction efforts, the Ecusta Division generated a
modest operating profit during the first three months of 1995.
Selling, General and Administrative Expenses
- - --------------------------------------------
The Registrant's selling, general and administrative expenses for the first
three months of 1995 were $1,754,000 more than the selling, general and
administrative expenses for the first three months of 1994. The increase is due
to an increase in profit sharing and incentive related expenses during the first
three months of 1995 over the corresponding period in 1994.
Interest on Debt (net)
- - ----------------------
The Registrant's interest on debt (net) increased $1,972,000 in the first three
months of 1995 compared to the first three months of 1994. The Registrant
capitalized $1,343,000 of interest during the first three months of 1994,
primarily due to the Spring Grove pulpmill modernization project which was
completed in the fourth quarter of 1994. No interest was capitalized during the
first three months of 1995. The increase in interest on debt (net) was also due
to the existence of short-term borrowings during the first three months of 1995.
There were no short-term borrowings during the first three months of 1994.
Interest on debt (net) was also higher during the first three months of 1995
compared to the first three months of 1994 due to a higher variable interest
rate on the Registrant's interest rate swap agreement having a total notional
principal amount of $50,000,000.
Income Tax Provision
- - --------------------
The Registrant's provision for income taxes increased by $7,082,000 for the
first three months of 1995 over the first three months of 1994 due to higher
taxable income.
FINANCIAL CONDITION:
- - -------------------
Liquidity:
The Registrant's cash and marketable securities increased by $1,598,000 during
the first three months of 1995. In addition, the Registrant lowered its short-
term bank borrowings by $700,000 at March 31, 1995 compared to December 31,
1994. These changes were primarily due to $17,488,000 of cash provided by
operating activities largely offset by the funding of capital projects of
$8,211,000 and the payment of $7,736,000 for dividends.
Included in the Registrant's funding of capital projects for the first three
months of 1995 was $4,128,000 related to the pulpmill modernization project and
the installation of a turbine generator at the Spring Grove mill. Both of these
projects were completed in the fourth quarter of 1994.
The Registrant expects to meet all of its near and long-term cash needs from a
combination of internally generated funds, cash, cash equivalents, marketable
securities and existing bank lines of credit.
ENVIRONMENTAL MATTERS:
- - ---------------------
The Registrant is subject to loss contingencies resulting from regulation by
various federal, state, local and foreign governmental authorities with respect
to the environmental impact of air and water emissions and noise from its mills,
as well as its disposal of solid waste generated by its operations. The
Registrant anticipates that environmental regulation of the Registrant's
operations will continue to become more burdensome and that capital and
operating expenditures required to comply with such environmental regulations
will continue, and perhaps increase, in the future. In addition, the Registrant
may incur obligations to remove or mitigate any adverse effects on the
environment resulting from its operations, including the restoration of natural
resources, and liability for personal injury and damage to property, including
natural resources.
9
<PAGE>
Among the environmental remediation matters in which the Registrant is involved
is the investigation by the Wisconsin Department of Natural Resources ("DNR")
regarding polychlorinated biphenyls ("PCBs") in the lower Fox River on which the
Registrant's Neenah Mill is located. DNR's attention has been directed to a
specific deposit of PCBs known as "Deposit A". Although DNR has not completed
the remedy selection process for Deposit A, DNR has proposed a remedy that it
estimates will cost $14.6 million. At least one other preliminary cost
estimate, which may not be comparable in scope, is significantly higher.
Furthermore, the DNR could propose remedies for the entire Fox River whose cost
would exceed the available resources of the Registrant and other companies upon
which most governmental attention has focused.
Although the Registrant's current assessment, after consultation with legal
counsel, is that such expenditures for Deposit A and other environmental matters
are not likely to have a material adverse effect on its financial condition,
results of operations or liquidity, there can be no assurance that its reserves
will be adequate or that such an effect will not occur at some future time.
10
<PAGE>
PART II OTHER INFORMATION
--------------------------
Item 6. Exhibits and Reports on Form 8-K
- - -----------------------------------------
(a) Exhibits
--------
Number Description of Documents
------ ------------------------
11 Computation of Net Income per Share
15 Letter in Lieu of Consent Regarding Review
Reports of Unaudited Interim Financial
Information
27 Financial Data Schedule
(b) Reports on Form 8-K
-------------------
None
11
<PAGE>
SIGNATURE
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.
P. H. GLATFELTER COMPANY
Date: May 12, 1995
-----------------------------------
R. P. Newcomer
Vice President, Treasurer and
Chief Financial Officer
12
<PAGE>
INDEX OF EXHIBITS
-----------------
Number Description of Documents
------ ------------------------
11 Computation of Net Income per Share
15 Letter in Lieu of Consent Regarding
Review Report of Unaudited Interim
Financial Information
27 Financial Data Schedule
13
<PAGE>
EXHIBIT 11
P. H. GLATFELTER COMPANY
AND CONSOLIDATED SUBSIDIARIES
=============================
Computation of Net Income Per Share
<TABLE>
<CAPTION>
For the 3 Months Ended
3/31/95 3/31/94
---------- -----------
<S> <C> <C>
Weighted average number of common and common
share equivalents:
Common Shares:
Shares outstanding, beginning of period.... 44,199,829 43,987,328
Shares issued:
Employee Stock Purchase Plans............ 571(1) 528(2)
Key Employee Long-Term Incentive Plan.... 1,284(3) -
----------- -----------
Total................................... 44,201,684 43,987,856
Common share equivalents applicable to
outstanding stock awards and
option grants............................ 183,310(4) 199,260(4)
----------- -----------
Total................................... 44,384,994 44,187,116
Net income................................... $12,514,085 $ 2,034,303
Net income per common share.................. $ .28 $ .05
=========== ===========
</TABLE>
(1) Weighted average effect of 51,421 common shares sold from treasury on
March 31, 1995.
(2) Weighted average effect of 47,528 common shares sold from treasury on
March 31, 1994.
(3) Weighted average effect of 2,091 net common shares issued from treasury
during the first quarter of 1995.
(4) Weighted average effect of shares subject to outstanding awards under the
Registrant's 1988 Restricted Common Stock Award Plan and weighted average
effect of shares issuable under the Registrant's 1992 Key Employee Long-
Term Incentive Plan.
<PAGE>
EXHIBIT (15)
LETTER IN LIEU OF CONSENT REGARDING REVIEW REPORT OF UNAUDITED
--------------------------------------------------------------
INTERIM FINANCIAL INFORMATION
-----------------------------
P. H. Glatfelter Company:
We have reviewed, in accordance with standards established by the American
Institute of Certified Public Accountants, the unaudited condensed consolidated
financial statements of P. H. Glatfelter Company and subsidiaries for the three-
month periods ended March 31, 1995 and 1994, as indicated in our report dated
April 17, 1995, except for Note 4 as to which the date is May 1, 1995; because
we did not perform an audit, we expressed no opinion on that information.
We are aware that our report referred to above, which is included in your
Quarterly Report on Form 10-Q for the quarter ended March 31, 1995, is
incorporated by reference in Registration Statements Nos. 33-24858, 33-25884,
33-37198, 33-49660, 33-53338 and 33-54409 on Form S-8.
We are also aware that the aforementioned report, pursuant to Rule 436(c) under
the Securities Act, is not considered a part of the Registration Statement
prepared or certified by an accountant or a report prepared or certified by an
accountant within the meaning of Sections 7 and 11 of that Act.
Deloitte & Touche LLP
Philadelphia, Pennsylvania
April 17, 1995, except for
Note 4 as to which the date
is May 1, 1995
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 4,731
<SECURITIES> 111
<RECEIVABLES> 59,379
<ALLOWANCES> 1,912
<INVENTORY> 77,621
<CURRENT-ASSETS> 142,790
<PP&E> 989,410
<DEPRECIATION> 535,708
<TOTAL-ASSETS> 653,889
<CURRENT-LIABILITIES> 96,614
<BONDS> 150,000
<COMMON> 544
0
0
<OTHER-SE> 300,917
<TOTAL-LIABILITY-AND-EQUITY> 653,889
<SALES> 155,037
<TOTAL-REVENUES> 157,128
<CGS> 125,099
<TOTAL-COSTS> 125,099
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 62
<INTEREST-EXPENSE> 2,753
<INCOME-PRETAX> 20,473
<INCOME-TAX> 7,959
<INCOME-CONTINUING> 12,514
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 12,514
<EPS-PRIMARY> .28
<EPS-DILUTED> .28
</TABLE>
