UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON DC 20549
FORM 10-Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
---------------------------------------
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
--------------------- ---------------
Commission File Number 1-9887
------------------
OREGON STEEL MILLS, INC.
(Exact name of registrant as specified in its charter)
Delaware 94-0506370
- ----------------------------------------------------------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1000 Broadway Building, Suite 2200, Portland, Oregon 97205
- ----------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(503) 223-9228
- ----------------------------------------------------------------------
(Registrant's telephone number, including area code)
- ----------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since
last report)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Sections 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.
Common Stock, $.01 Par Value 19,421,643
---------------------------- -----------------------------
Class Number of Shares Outstanding
(as of July 31, 1995)
<PAGE>
OREGON STEEL MILLS, INC.
INDEX
Page
----
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets
June 30, 1995 (unaudited)
and December 31, 1994 . . . . . . . . . 2
Consolidated Statements of Income (unaudited)
Three months and six months ended
June 30, 1995 and 1994 . . . . . . . . . . 3
Consolidated Statements of Cash Flows
(unaudited)
Six months ended June 30, 1995
and 1994 . . . . . . . . . . . . . . . . . 4
Notes to Consolidated Financial
Statements (unaudited) . . . . . . . . . . . 5 - 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations . . . . . . . . . . . . . . . 7 - 10
PART II. OTHER INFORMATION
Item 1. Legal Proceedings . . . . . . . . . . . . . . . 11
Item 6. Exhibits and Reports on Form 8-K. . . . . . . . 11
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . 11
1
<PAGE>
OREGON STEEL MILLS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
June 30,
1995 December 31,
(Unaudited) 1994
----------- ------------
ASSETS
Current assets:
Cash and cash equivalents $ 184 $ 5,039
Trade accounts receivable, net 70,587 80,203
Inventories 137,656 160,788
Other current assets 6,013 7,661
Deferred tax asset 5,775 5,775
-------- ---------
Total current assets 220,215 259,466
-------- ---------
Property, plant and equipment:
Land and improvements 28,494 28,319
Buildings 37,059 36,943
Machinery and equipment 286,424 230,019
Construction in progress 148,365 139,842
-------- --------
500,342 435,123
Accumulated depreciation (105,155) (97,027)
-------- --------
395,187 338,096
-------- --------
Excess of cost over net assets
acquired 42,089 42,569
Other assets 32,745 25,602
-------- --------
$690,236 $665,733
======== ========
LIABILITIES
Current liabilities:
Current portion of long-term debt $ 4,274 $ 5,302
Accounts payable 81,783 85,618
Accrued expenses 36,304 24,692
Other taxes payable 2,922 2,374
-------- --------
Total current liabilities 125,283 117,986
Long-term debt 199,507 187,935
Deferred employee benefits 17,422 17,661
Other deferred liabilities 36,177 36,609
Deferred income taxes 13,247 10,725
-------- --------
391,636 370,916
-------- --------
Minority interests 18,903 18,934
-------- --------
STOCKHOLDERS' EQUITY
Common stock 194 194
Additional paid-in capital 150,826 150,090
Retained earnings 132,369 130,145
-------- --------
283,389 280,429
Cumulative foreign currency
translation adjustment (3,692) (4,546)
-------- --------
279,697 275,883
-------- --------
$690,236 $665,733
======== ========
The accompanying notes are an integral part of the
consolidated financial statements.
2
<PAGE>
<TABLE>
OREGON STEEL MILLS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except tonnage and per share amounts)
(Unaudited)
<CAPTION>
Three Months Ended June 30, Six Months Ended June 30,
--------------------------- -------------------------
1995 1994 1995 1994
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Revenues:
Sales $151,148 $234,804 $338,165 $453,669
Proceeds from insurance settlement 3,959 - 3,959 -
-------- -------- -------- --------
Total revenues 155,107 234,804 342,124 453,669
Costs and expenses:
Cost of sales 131,380 213,406 301,658 411,562
Selling, general and
administrative expenses 10,422 13,604 21,251 25,910
Contribution to employee
stock ownership plan 334 251 668 501
Profit participation 1,991 401 2,726 1,052
-------- -------- -------- --------
Operating income 10,980 7,142 15,821 14,644
Other income (expense):
Interest and dividend income 57 115 125 248
Interest expense (2,240) (1,398) (4,123) (2,443)
Other, net 458 296 608 252
Minority interests 162 (609) 66 (1,207)
-------- -------- -------- --------
Income before income taxes 9,417 5,546 12,497 11,494
Income tax expense 3,671 2,107 4,841 4,368
-------- -------- -------- --------
Net income $ 5,746 $ 3,439 $ 7,656 $ 7,126
======== ======== ======== ========
Primary and fully diluted net income per
common and common equivalent share $.29 $.17 $.38 $.36
Dividends declared per common share $.14 $.14 $.28 $.28
Weighted average common shares
and common share equivalents
outstanding 20,020 19,976 20,013 19,971
Tonnage sold 277,200 467,000 672,300 889,000
The accompanying notes are an integral part of the consolidated financial statements.
3
/TABLE
<PAGE>
OREGON STEEL MILLS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Six Months Ended June 30,
-------------------------
1995 1994
-------- --------
Cash flows from operating activities:
Net income $ 7,656 $ 7,126
Adjustments to reconcile net income
to net cash provided (used) by
operating activities:
Depreciation 10,414 10,597
Amortization 687 668
Deferred income tax provision 2,522 2,960
Accrual for contribution of
common stock to employee stock
ownership plan 667 500
Minority interests (30) 1,148
Other, net (1,846) 1,016
Changes in current assets and
liabilities, net 40,977 (43,064)
------- --------
NET CASH PROVIDED (USED) BY OPERATING
ACTIVITIES 61,047 (19,049)
------- --------
Cash flows from investing activities:
Additions to property, plant
and equipment (70,644) (55,956)
Other, net (420) (20)
------- --------
NET CASH USED BY INVESTING ACTIVITIES (71,064) (55,976)
------- --------
Cash flows from financing activities:
Net borrowings under revolving
loan agreements 2,807 79,655
Borrowings from Senior Credit Facilities 10,000 -
Payments of other debt (2,358) (1,992)
Dividends paid (5,432) (5,421)
Other, net (59) 197
------- --------
NET CASH PROVIDED BY FINANCING
ACTIVITIES 4,958 72,439
------- --------
Effects of foreign currency exchange
rate changes on cash 204 (20)
------- --------
Net decrease in cash and cash equivalents (4,855) (2,606)
Cash and cash equivalents at beginning
of period 5,039 9,623
------- --------
Cash and cash equivalents at end of period $ 184 $ 7,017
======= ========
Supplemental disclosures of cash flow
information:
Cash paid for:
Interest $9,277 $4,406
Income taxes $ 505 $3,940
NON-CASH OPERATING, INVESTING AND FINANCING ACTIVITIES:
At June 30, 1995 and June 30, 1994, the Company had financed property,
plant and equipment with accounts payable of $19.9 million and $13.4
million, respectively.
The accompanying notes are an integral part of the
consolidated financial statements.
4<PAGE>
OREGON STEEL MILLS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
---------------------
The consolidated financial statements include the accounts of
Oregon Steel Mills, Inc. and its subsidiaries (the "Company").
All significant intercompany balances and transactions have been
eliminated upon consolidation. Certain previously reported
amounts have been reclassified to conform with current period
presentation.
The unaudited financial statements include all adjustments
(consisting of normal recurring accruals) which, in the opinion
of management, are necessary for a fair presentation of the
interim periods. Results for an interim period are not
necessarily indicative of results for a full year. Reference
should be made to the Company's 1994 Annual Report on Form 10-K
for additional disclosures including a summary of significant
accounting policies.
2. Inventories
-----------
Inventories consist of:
June 30, December 31,
1995 1994
-------- ------------
(In thousands)
Raw materials $ 15,473 $ 37,389
Semi-finished product 47,211 50,033
Finished product 53,798 50,320
Stores and operating supplies 21,174 23,046
-------- ---------
$137,656 $160,788
======== =========
3. Common Stock
------------
In February 1995 the Company contributed approximately 44,300
shares of common stock of the Company ("Common Stock") to the
Employee Stock Ownership Plan (the "ESOP") in payment of a
$736,000 liability accrued in 1994. In February 1994 the
Company contributed approximately 29,600 shares of Common Stock
to the ESOP in payment of a $753,000 liability accrued in 1993.
On July 27, 1995, the Board of Directors declared a quarterly
cash dividend of 14 cents per share to be paid August 31, 1995,
to stockholders of record as of August 11, 1995.
4. Contingencies
-------------
ENVIRONMENTAL. The Company's Napa Pipe Corporation subsidiary
has a reserve of $2.7 million at June 30, 1995 for environmental
remediation relating to the Napa pipe mill. The Company's 90
percent owned New CF&I, Inc. subsidiary owns a 95.2 percent
interest in a Pueblo, Colorado steel mill, CF&I Steel, L.P.
("CF&I"). In connection with CF&I's acquisition of certain
assets from CF&I Steel Corporation in 1993, CF&I established a
reserve of $36.7 million for environmental remediation. At June
30, 1995, CF&I has a reserve of $36 million, of which $34
million is classified as non-current in other deferred
liabilities in the consolidated balance sheet.
5
<PAGE>
OREGON STEEL MILLS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
5. Commitments
-----------
During 1994 the Company began construction of various capital
improvement projects at both its Portland, Oregon and Pueblo,
Colorado steel mills. Commitments for expenditures related to
the completion of these projects were $69.9 million at June 30,
1995.
6. Proceeds From Insurance Settlement
----------------------------------
During the second quarter of 1995, the Company received
insurance proceeds of approximately $4 million as reimbursement
of lost profits resulting from lost production and start-up
delays of CF&I's rod/bar mill caused by an explosion that
occurred during the third quarter of 1994.
6
<PAGE>
OREGON STEEL MILLS, INC.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
General
- -------
The consolidated financial statements include the accounts of
Oregon Steel Mills, Inc. and its wholly-owned and majority-owned
subsidiaries (the "Company"), Napa Pipe Corporation ("Napa"), Oregon
Steel Mills - Fontana Division, Inc. ("Fontana"), Camrose Pipe
Corporation ("CPC") which owns a 60 percent interest in Camrose Pipe
Company ("Camrose"), 90 percent owned New CF&I, Inc. which owns a 95.2
percent interest in CF&I Steel, L.P. ("CF&I"), and certain other
insignificant subsidiaries. Fontana ceased production in the fourth
quarter of 1994 and closed permanently in the first quarter of 1995.
Results of Operations
- ---------------------
The following table sets forth tonnage sold, sales revenues and
average selling price per ton by division:
Three Months Ended, Six Months Ended,
June 30, June 30,
------------------- -----------------
1995 1994 1995 1994
------ ------ ------ ------
Total tonnage sold:
Oregon Steel Division (1):
Plate products 73,200 116,300 165,100 208,300
Welded pipe products 53,900 145,000 107,200 274,800
Semi-finished products 43,300 1,400 101,000 1,400
CF&I Steel Division 106,800 204,300 299,000 404,500
------- ------- ------- -------
Total 277,200 467,000 672,300 889,000
======= ======= ======= =======
Sales revenues
(in thousands):
Oregon Steel Division $ 92,970 $144,878 $192,300 $274,156
CF&I Steel Division 58,178 89,926 145,865 179,513
-------- -------- -------- --------
Total $151,148 $234,804 $338,165 $453,669
======== ======== ======== ========
Average selling price
per ton:
Oregon Steel Division $546 $551 $515 $566
CF&I Steel Division $545 $440 $488 $444
Average $545 $503 $503 $510
- ---------------------------------
(1) The Oregon Steel Division consists primarily of the
operations of the Portland, Oregon steel mill, Napa,
Fontana and Camrose.
The consolidated average selling price increased $42 to $545 per
ton for the second quarter of 1995 and decreased $7 to $503 per ton
for the first six months of 1995, compared to the corresponding 1994
periods. The primary reasons for the changes in the consolidated
average selling prices were the increased volume of sales of the
generally lowest priced semi-finished products and the decreased
volume of sales of the generally highest priced welded pipe products
sold by the Oregon Steel Division, offset by a significant reduction
in the sales volume of the CF&I Steel Division's lowest priced rod and
bar products. In addition, selling prices generally increased in the
second quarter and the first six months of 1995, compared to the
corresponding periods in 1994 due to favorable market conditions and
improved quality resulting from capital facility improvements.
However, Oregon Steel Division's Canadian Camrose pipe mill was
negatively impacted by a significant reduction in demand for its pipe
products in the second quarter of 1995.
7
<PAGE>
OREGON STEEL MILLS, INC.
Consolidated tonnage sold decreased 189,800 tons to 277,200 tons
for the second quarter of 1995 and decreased 216,700 tons to 672,300
tons for the first six months of 1995, compared to the corresponding
1994 periods. These tonnage decreases were primarily the result of
reduced welded pipe shipments from the Napa and Camrose pipe mills,
reduced rod and bar shipments from the CF&I Steel Division, offset by
increased semi-finished product shipments from the Portland steel
mill. The Company was able to maximize the efficiency of its Portland
steel mill by utilizing its excess hot metal capacity by producing and
selling semi-finished products in the first six months of 1995. The
Company expects to continue selling semi-finished products for the
balance of 1995 and into 1996 until the Portland steel mill's
combination mill comes on line. Reduced rod and bar mill tonnage for
the three and six month periods ended June 30, 1995 is primarily due
to the capitalization of revenues and costs associated with the pre-
operational phase of CF&I's new rod/bar mill. The Company estimates
the new rod/bar mill to be fully operational during the third quarter
of 1995.
As a result of the decreased sales volume and changes in average
selling prices, sales revenues for the three and six month periods
ended June 30, 1995 were $151.1 million and $338.2 million,
respectively, compared to $234.8 million and $453.7 million for the
corresponding 1994 periods. Of the $83.7 million second quarter sales
revenue decrease, $95.4 million was the result of a volume decrease,
offset by $11.7 million resulting from higher average selling prices.
Of the $115.5 million year-to-date sales revenue decrease, $110.5
million was the result of a volume decrease, and $5 million resulted
from lower average selling prices.
Gross profit for the three and six month periods ended June 30,
1995, increased $2.3 million and decreased $1.6 million from the
corresponding 1994 periods to $23.7 million and $40.5 million,
respectively. Gross profit as a percentage of revenues for the three
and six month periods ended June 30, 1995 increased 6.2 percent and
2.5 percent, respectively, to 15.3 percent and 11.8 percent. The $2.3
million quarterly increase resulted from a $7.1 million positive
average margin variance and a $4 million insurance settlement, offset
by a $8.8 million negative volume variance. The $1.6 million year-to-
date decrease resulted from a $10.3 million negative volume variance,
offset by a $4.7 million positive average margin variance and a $4
million insurance settlement.
Gross profits were positively impacted by the $4 million
proceeds received from the Company's business interruption insurance
carrier in the second quarter of 1995 primarily for reimbursement of
lost profits at the CF&I Steel Division due to lost production and the
delay in the start-up of the new rod/bar mill. The delay was caused
by an explosion that occurred during the third quarter of 1994. Gross
profits were negatively impacted by the extension of start-up of the
capital projects at the Company's CF&I Steel Division beyond the
original time table. The associated incremental costs were estimated
to be $1.2 million and $3.8 million more in the second quarter and the
first half of 1995, respectively, than the corresponding periods in
1994.
Gross profits also improved, in the second quarter and first
half of 1995 compared to the corresponding periods in 1994, due to
higher selling prices as discussed above, and due to a somewhat
greater percentage of sales of higher margin specialty steel plate to
total sales of all grades of steel plate. Additionally, gross profits
improved because CF&I Steel Division's lowest margin rod and bar
product sales were only 1.6 and 23.6 percent of total CF&I Steel
Division sales in the second quarter of 1995 and the first half of
1995 compared to 41.3 and 41.5 percent in the corresponding periods in
1994. Further, gross profits improved because the current periods
were not burdened with higher manufacturing costs and sales allowances
associated with producing and selling high quality pipe grades for
international pipe shipments from the Company's Napa pipe mill, as was
the case in the corresponding prior periods.
The gross profit improvements were offset by gross profit
declines of $1.9 million due to costs incurred primarily in the first
quarter of 1995 which were associated with the winding down of
operations of the Company's Fontana plate mill which was permanently
closed in December of 1994. Contributing to the offset of increasing
gross profits were higher scrap prices at the Oregon Steel and CF&I
Steel Divisions. Additionally, gross profits were reduced due to
increased costs associated with notably lower production levels at the
Company's Camrose pipe mill.
8
<PAGE>
OREGON STEEL MILLS, INC.
Selling, general and administrative expenses ("SG&A") for the
three month and six month periods ended June 30, 1995 decreased $3.1
million and $4.6 million, respectively, from the corresponding periods
in 1994. These decreases were due primarily to decreased shipping
expenses by the Oregon Steel Division as a result of the closure of
the Fontana plate mill in December of 1994 and reduced shipping volume
from the Company's Napa and Camrose pipe mills. Additionally, the
closure of the Fontana plate mill reduced SG&A costs, other than
shipping expenses, $814,000 and $1.4 million in the three and six
month periods ended 1995 compared to the same periods in 1994. SG&A
as a percent of revenues for the three and six month periods ended
June 30, 1995 was 6.7 and 6.2 percent, respectively, compared to 5.8
and 5.7 percent for the corresponding periods in 1994.
The contribution to the employee stock ownership plan and the
profit participation expense for the three and six month periods ended
June 30, 1995 increased compared to the corresponding 1994 periods,
reflecting the increased profitability in 1995 versus 1994.
Other Income (Expense)
- ----------------------
Total interest costs for the three and six month periods ended
June 30, 1995, were $5.4 million and $10.1 million, respectively,
compared to $2.9 million and $5 million for the corresponding 1994
periods. These increases were primarily the result of the debt
incurred to fund the Portland combination mill and the CF&I capital
expenditure programs. Capitalized interest cost for the three and six
month periods ended June 30, 1995 was $3.2 million and $6 million,
respectively, compared to $1.5 million and $2.6 million for the
corresponding 1994 periods.
Income Taxes
- ------------
The Company's effective income tax rate was 39 percent for the
three and six month periods ended June 30, 1995, and 38 percent for
the corresponding 1994 periods. The benefit of income taxes was at a
rate of 32.2 percent for the year ended December 31, 1994. Income
before income taxes in 1994 included a non-taxable $12.3 million gain
on the sale of a 10 percent equity interest in New CF&I, Inc. Also
contributing to the 1994 income tax benefit was the utilization of
state tax credits.
Liquidity and Capital Resources
- -------------------------------
The Company's cash flow from operations for the six month period
ended June 30, 1995 was a positive $61 million compared to a negative
cash flow of $19 million in the corresponding 1994 period. The major
items causing the $80 million increase were a decrease in trade
accounts receivable in 1995 versus an increase in 1994 ($43 million),
a greater reduction of inventories in 1995 compared to the
corresponding 1994 period ($18.5 million), a decrease in refundable
income taxes in 1995 compared to an increase in 1994 ($4.3 million), a
smaller increase in accounts payable in 1995 compared to the increase
in 1994 ($12 million), and a larger increase in accrued expenses in
1995 versus the increase in the corresponding 1994 period ($7.1
million). These increases in cash flow were offset by decreases in
cash flow due to an increase in notes receivable in 1995 versus 1994
($2.1 million), a reduced increase in post-retirement obligations in
1995 versus 1994 ($1.6 million), and a reduction of minority interests
in 1995 versus an increase in 1994 ($1.2 million).
Net working capital at June 30, 1995 decreased $46.6 million
from December 31, 1994 due to a $39.3 million decrease in current
assets, principally inventory and accounts receivable, and $7.3
million increase in current liabilities, principally accrued expenses.
Cash generated from operations was used primarily to fund the
Company's capital expansion projects.
9
<PAGE>
OREGON STEEL MILLS, INC.
The Company maintains a $100 million revolving credit facility
and a $200 million term loan facility (the "Senior Credit
Facilities"). Maximum borrowings available under the revolving credit
facility are based on the amount of the combined inventory and
accounts receivable of the Company. At June 30, 1995, $140 million
was outstanding under the Senior Credit Facilities.
The Company has a $14.5 million uncollateralized and uncommitted
revolving line of credit with a bank which matures May 31, 1996 and
may be used to support issuance of letters of credit, foreign exchange
contracts and interest rate hedges. At June 30, 1995, $9.6 million
was restricted under outstanding letters of credit. In addition, the
Company has a $5 million uncollateralized and uncommitted revolving
credit line with a bank which is restricted to use for letters of
credit. At June 30, 1995, $3.6 million was restricted under
outstanding letters of credit.
Camrose maintains a Canadian $24 million revolving credit
facility with a bank, $9 million of which expires August 31, 1995,
with the remainder expiring on October 31, 1996. The facility is
collateralized by substantially all of the assets of Camrose.
Borrowings under this facility are limited to an amount equal to
specified percentages of Camrose's eligible trade accounts receivables
and inventories. As of June 30, 1995, Camrose had $5.5 million
outstanding under this facility.
CF&I incurred indebtedness in an original principal amount of
$67.5 million as part of the purchase price of the assets of CF&I
Steel Corporation on March 3, 1993. At June 30, 1995, the outstanding
balance was $57.7 million, of which $53.4 million was classified as
noncurrent.
The Company's total capitalization at June 30, 1995 of $480
million consists of $200 million in long-term debt and $280 million in
stockholder's equity, for a long-term debt-to-capitalization ratio of
.42 to 1. Net book value per share of common stock at June 30, 1995
was $14.40 per share versus $14.24 per share at December 31, 1994.
The Company believes that anticipated needs for working capital and
the capital expenditure program (noted below) will be met from
existing cash balances, funds generated from operations and borrowings
pursuant to the Senior Credit Facilities.
CAPITAL EXPENDITURES. In the first six months of 1995, the
Company expended approximately $28 million on the capital program at
CF&I and $40 million on the combination mill at the Portland steel
mill. During the balance of 1995 the Company expects to expend $42
million on the capital program at CF&I and $85 million on the
combination mill at the Portland steel mill. To complete the capital
program at CF&I and the combination mill in 1996, the Company expects
to expend $15 million at CF&I and $58 million on the combination mill.
In addition, the Company has expended approximately $3 million
for capital improvements at its Oregon Steel Division manufacturing
facilities for recurring upgrade projects to the present facilities
and equipment during the first six months of 1995. The Company
expects to expend approximately $7 million on these projects during
the remainder of 1995. The Company has also budgeted $15 million for
an approximate 13 percent equity interest in a planned Venezuelan hot
briquetted iron plant. Approximately $7 million is planned to be
expended in 1995.
10
<PAGE>
OREGON STEEL MILLS, INC.
PART II OTHER INFORMATION
Item 1. Legal Proceedings
-----------------
STATE OF OREGON OCCUPATIONAL SAFETY AND HEALTH
DIVISION ("OREGON OSHA") CITATION. On July 25, 1995
Oregon OSHA cited the Company $1.4 million in penalties
for alleged violations of Oregon occupational safety and
health rules. Of the eighteen individual citations, ten
were alleged by Oregon OSHA to be willful.
Oregon OSHA claims that a Material Safety Data Sheet
("MSDS") that the Company had prepared for its glass frit
product produced at its Portland steel mill was
incomplete in its description of certain metals present
in the product. Oregon OSHA also claims that certain
administrative and recordkeeping aspects of the glass
plant's lead and cadmium protection programs were not in
complete compliance with applicable OSHA regulations.
With the assistance of counsel, the Company has conducted
its own investigation of all the alleged violations.
Based on that investigation, it is the Company's belief
that no willful violation of the OSHA rules occurred.
Since Oregon OSHA's investigation began, the Company has
been fully cooperating with OSHA. Oregon OSHA has
pointed out some areas where the Company has not been in
complete technical compliance with certain administrative
and recordkeeping rules, and the Company promptly
corrected those issues. The Company has appealed the
citation, and believes that the final outcome will not
have a material adverse effect on the Company's results
of operations, its financial position, or its cash flows.
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits
11. Statement Regarding Computation of Per
Share Earnings
27. Financial Data Schedule
(b) Reports on Form 8-K
During the quarter ended June 30, 1995, no reports
on Form 8-K were filed by the Company.
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.
OREGON STEEL MILLS, INC.
Date: August 11, 1995
/s/ Jackie L. Williams
--------------------------
Jackie L. Williams
Corporate Controller
(Principal Accounting Officer)
11
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<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<CASH> 184
<SECURITIES> 0
<RECEIVABLES> 72458
<ALLOWANCES> 1871
<INVENTORY> 137656
<CURRENT-ASSETS> 220215
<PP&E> 500342
<DEPRECIATION> 105155
<TOTAL-ASSETS> 690236
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<BONDS> 0
<COMMON> 194
0
0
<OTHER-SE> 279503
<TOTAL-LIABILITY-AND-EQUITY> 690236
<SALES> 338165
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<NET-INCOME> 7656
<EPS-PRIMARY> .38
<EPS-DILUTED> .38
</TABLE>
OREGON STEEL MILLS, INC.
EXHIBIT 11
STATEMENT REGARDING COMPUTATION
OF PER SHARE EARNINGS
(In thousands, except per share data amounts)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ----------------
1995 1994 1995 1994
------ ------ ------ ------
Weighted average number of
common shares outstanding 19,422 19,378 19,415 19,373
Common stock equivalents
arising from 598 shares
of stock to be issued
March 2003 598 598 598 598
------- ------- ------- -------
20,020 19,976 20,013 19,971
======= ======= ======= =======
Net income $ 5,746 $ 3,439 $ 7,656 $ 7,126
======= ======= ======= =======
Primary and fully diluted
net income per common
and common equivalent
share $.29 $.17 $.38 $.36
==== ==== ==== ====
