SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For fiscal year ended December 31, 1995
Commission file number 1-9887
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
Oregon Steel Mills, Inc. Employee Stock Ownership Plan
B. Name of issuer of the securities held pursuant to the plan and
the address of its principal executive office:
OREGON STEEL MILLS, INC.
1000 BROADWAY BUILDING SUITE 2200
PORTLAND, OR 97205
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit
plan) have duly caused this annual report to be signed on its behalf
by the undersigned hereunto duly authorized.
OREGON STEEL MILLS, INC. EMPLOYEE STOCK OWNERSHIP PLAN
/s/ L. Ray Adams
---------------------
L. Ray Adams, Trustee
March 29, 1996
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OREGON STEEL MILLS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
------------
REPORT ON AUDITS OF FINANCIAL STATEMENTS
AND SUPPLEMENTAL SCHEDULES
for the three years in the period
ended December 31, 1995
<PAGE>
OREGON STEEL MILLS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
REPORT ON AUDITS OF FINANCIAL STATEMENTS
AND SUPPLEMENTAL SCHEDULES
FOR THE THREE YEARS IN THE PERIOD ENDED DECEMBER 31, 1995
<PAGE>
OREGON STEEL MILLS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
TABLE OF CONTENTS
PAGE
Report of Independent Accountants 1
Financial Statements:
Statements of Net Assets Available for Plan Benefits at
December 31, 1995, 1994 and 1993 3
Statements of Changes in Net Assets Available for Plan
Benefits for the three years in the period ended
December 31, 1995 4
Notes to Financial Statements 5
Supplemental Schedules:
Item 27a - Schedule of Assets Held for Investment Purposes
at December 31, 1995 8
Item 27d - Schedule of Reportable and Party-in-Interest
Transactions for the year ended December 31, 1995 9
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
The Board of Trustees
Oregon Steel Mills, Inc.
Employee Stock Ownership Plan
Portland, Oregon
We have audited the accompanying statements of net assets available
for plan benefits of the Oregon Steel Mills, Inc. Employee Stock
Ownership Plan (the Plan) as of December 31, 1995, 1994 and 1993 and
the related statements of changes in net assets available for plan
benefits for each of the three years in the period ended December 31,
1995. These financial statements are the responsibility of the Plan's
management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the net assets available for
benefits of the Plan as of December 31, 1995, 1994 and 1993, and the
changes in net assets available for plan benefits for each of the
three years in the period ended December 31, 1995, in conformity with
generally accepted accounting principles.
1
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Our audits were made for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental
Schedules of Assets Held for Investment Purposes and Reportable and
Party-in-Interest Transactions as of and for the year ended December
31, 1995 are presented for the purpose of additional analysis and are
not a required part of the basic financial statements, but are
supplementary information required by the Department of Labor's Rules
and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The supplemental schedules
have been subjected to the auditing procedures applied in the audit of
the basic financial statements for the year ended December 31, 1995
and, in our opinion, are fairly stated in all material respects in
relation to the basic financial statements taken as a whole.
/s/Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Portland, Oregon
February 27, 1996
2<PAGE>
<TABLE>
OREGON STEEL MILLS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
December 31, 1995, 1994 and 1993
<CAPTION>
1995 1994 1993
ASSETS
<S> <C> <C> <C>
Investment in Oregon Steel Mills, Inc.
common stock $31,913,472 $37,616,626 $69,321,183
Cash 54,130 30,483 36,308
Employer contribution receivable 736,000 750,000
----------- ----------- -----------
Total assets 31,967,602 38,383,109 70,107,491
----------- ----------- -----------
LIABILITIES
Dividend checks outstanding 15,157 6,235 17,735
----------- ----------- -----------
Total liabilities 15,157 6,235 17,735
----------- ----------- -----------
Net assets available for plan benefits $31,952,445 $38,376,874 $70,089,756
=========== =========== ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
3
</TABLE>
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<TABLE>
OREGON STEEL MILLS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
for the three years in the period ended December 31, 1995
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Dividends deemed received $ 1,336,882 $ 1,459,264 $ 1,626,641
Interest income 1,219 469 187
Employer contribution 1,526 737,672 754,000
----------- ------------ -----------
Total additions 1,339,627 2,197,405 2,380,828
----------- ------------ -----------
Deductions from net assets attributed to:
Net depreciation of investments 4,008,542 24,872,202 1,644,855
Benefits distributed to participants 2,186,638 7,491,865 8,240,177
Transfer of assets to the Oregon Steel
Mills, Inc. Thrift Plan 231,994 86,956 675,700
Pass-through of dividends deemed received 1,336,882 1,459,264 1,626,641
----------- ------------ -----------
Total deductions 7,764,056 33,910,287 12,187,373
----------- ------------ -----------
Net deductions (6,424,429) (31,712,882) (9,806,545)
Net assets available for plan benefits:
Beginning of year 38,376,874 70,089,756 79,896,301
----------- ------------ -----------
End of year $31,952,445 $ 38,376,874 $70,089,756
=========== ============ ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
4
</TABLE>
<PAGE>
OREGON STEEL MILLS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
1. PLAN DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
The following description of the Oregon Steel Mills, Inc. (the
Company) Employee Stock Ownership Plan (the Plan) provides only
general information. Participants should refer to the Plan
document or the Summary Plan Description for a more complete
description of the Plan's provisions.
PLAN DESCRIPTION
The Plan, established by the Company on November 27, 1980 and as
amended and restated effective January 1, 1994, is designed to
invest primarily in common stock of the Company for the benefit of
eligible employees (those employed by the Company or its wholly
owned subsidiary, Napa Pipe Corporation, at year end with at least
six months service). Employer contributions to the Plan are made
at the sole discretion of the Company's Board of Directors,
generally in the form of newly issued shares of the Company's
common stock. Employer contributions are allocated annually to
each participant's account based on the proportion that each
participant's compensation bears to total compensation, subject to
specified limitations. Voluntary contributions by participants
are not permitted.
Payments of vested benefits to a participant whose employment has
terminated are generally made by a single distribution of Company
stock. The Plan may distribute cash in lieu of Company stock at
the election of the Plan's administrative committee provided
sufficient cash is available and provided the participant consents
in writing to receive a cash distribution.
The full amount credited to a participant's account vests at age
65 or when a participant terminates by reason of death or total
disability. The account of a participant otherwise vests ratably
over seven years of employment, at the rate of ten percent for
each of the first four years, and twenty percent for each of the
next three years. At termination, the nonvested portion of a
former participant's account is forfeited. All forfeitures are
allocated among the accounts of persons who are participants on
the last day of the Plan's fiscal year, or whose participation in
the Plan terminated during the fiscal year because of Normal
Retirement (as defined in the Plan), death, total disability or
layoff, in the proportion that each such person's compensation
taken into account under the Plan bears to such compensation of
all those persons for the fiscal year.
A participant who has attained age 59-1/2 and is fully vested may
elect to receive a distribution of his or her entire account
balance in the Plan. On December 7, 1989, the Plan was amended,
effective January 1, 1990, to allow participants who are
fully vested and who have attained
5<PAGE>
OREGON STEEL MILLS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS, CONTINUED
1. PLAN DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES,
CONTINUED:
PLAN DESCRIPTION, CONTINUED
the age of 40, but not age 59-1/2, to elect a distribution of part
of their Plan stock account balance. The maximum amount of the
elective distribution is a percentage of the participant's common
stock account determined on a cumulative basis at the rate of 5%
per year, beginning with the year the participant attains age 40,
up to 50% of the participant's stock account. The method of
distribution can be either partly or totally in the form of a
distribution of common stock to the participant or a sale of
common stock by the Plan and a transfer of the proceeds from the
sale to the participant's account under the Company's Thrift Plan.
An administrative committee appointed by the Company's Chief
Executive Officer administers the Plan.
Contributions under the Plan and all other assets of the Plan are
held in trust under agreements entered into between the Company
and the Plan Trustees.
While the Company has not expressed any intent to terminate the
Plan, it may do so at its sole discretion. In the event the Plan
is terminated, benefits become fully vested and nonforfeitable and
the assets of all participants' accounts will be distributed to or
for the benefit of the participants in accordance with the Plan's
provisions.
The following is a summary of significant accounting policies
followed in preparation of the Plan's financial statements:
INVESTMENTS
The investment in the Company's common stock is stated at fair
value at December 31, 1995, 1994 and 1993, as determined by the
closing quote on that day on the New York Stock Exchange.
The Plan presents in the statement of changes in net assets
available for plan benefits the net appreciation or depreciation
in the fair value of its investments which consists of the
realized gains or losses and the unrealized appreciation or
depreciation on those investments.
Dividend income is accrued on the ex-dividend date. Sales of
investment are recorded on a trade-date basis. Realized gains and
losses are based on the actual cost of securities.
6
<PAGE>
OREGON STEEL MILLS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS, CONTINUED
1. PLAN DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES,
CONTINUED:
BENEFITS TO FORMER PARTICIPANTS
Benefits are accrued as a liability in the period the participant
terminates. A terminated participant may elect to defer the date
benefits are distributed to a date beyond age 65, but no later
than April 1 following the calendar year in which the participant
attains age 70-1/2.
FEDERAL INCOME TAXES
The Plan has received a favorable determination from the Internal
Revenue Service as to the qualification of the Plan and exemption
from federal income taxes.
EXPENSES
Administrative expenses of the Plan have been paid by the Company
at its election.
2. INVESTMENT IN OREGON STEEL MILLS, INC. COMMON STOCK:
During 1993, 1994 and 1995, the changes in shares of common stock
of the Company owned by the Plan were as follows:
December 31, 1992 2,995,155
Shares contributed by Oregon Steel Mills, Inc. 146,982
Shares sold or distributed in 1993 (383,085)
---------
December 31, 1993 2,759,052
Shares contributed by Oregon Steel Mills, Inc. 29,852
Shares sold or distributed in 1994 (381,440)
---------
December 31, 1994 2,407,464
Shares contributed by Oregon Steel Mills, Inc. 44,630
Shares sold or distributed in 1995 (152,024)
---------
December 31, 1995 2,300,070
=========
Shares are valued at a market price of $13.875 per share at
December 31, 1995, $15.625 per share at December 31, 1994 and
$25.125 per share at December 31, 1993.
7
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SUPPLEMENTAL SCHEDULES
<PAGE>
<TABLE>
OREGON STEEL MILLS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
ITEM 27A - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
December 31, 1995
<CAPTION>
NUMBER DECREASE
OF INVENTORY FAIR IN FAIR
SHARES BASIS VALUE(1) VALUE VALUE(2)
---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Oregon Steel Mills, Inc.
Common stock (3) 2,300,070 $21,074,006 $35,983,091 $31,913,472 $4,069,619
(1) Market value as of December 31, 1994 or market value at time of contribution if contributed subsequent to that
date.
(2) Computed as the difference between fair value and inventory value.
(3) Represents party-in-interest investment.
8
/TABLE
<PAGE>
OREGON STEEL MILLS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
ITEM 27D - SCHEDULE OF REPORTABLE AND
PARTY-IN-INTEREST TRANSACTIONS
for the year ended December 31, 1995
The following represents any transaction or series of transactions
within the Plan which involved an amount in excess of five percent of
the December 31, 1994 current value of Plan assets, or any party-in-
interest transactions:
RECEIPTS: AMOUNT
- --------- ------------
Dividends deemed received from Oregon
Steel Mills, Inc. (1) $1,336,882
Employer stock contribution from Oregon
Steel Mills, Inc. (1) 1,526
DISBURSEMENTS:
- --------------
Pass-through of dividends deemed received by
participants (1) 1,336,882
Benefits to participants (1) 2,186,638
Transfer of assets to Oregon Steel Mills, Inc.
Thrift Plan (1) 231,994
(1) Represents party-in-interest transaction.
9
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration
statement of the Oregon Steel Mills, Inc. Employee Stock Ownership
Plan on Form S-8 (File No. 33-26739) of our report, dated February 27,
1996, on our audits of the financial statements and supplemental
schedules of the Oregon Steel Mills, Inc. Employee Stock Ownership
Plan as of December 31, 1995, 1994, and 1993, and for the years then
ended, which report is included in this Annual Report on Form 11-K.
/s/Coopers & Lybrand L.L.P.
Coopers & Lybrand L.L.P.
Portland, Oregon
March 27, 1996
<PAGE>
