UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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 endedJanuary 31, 2001
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 number0-2389
ROANOKE ELECTRIC STEEL CORPORATION
(Exact name of Registrant as specified in its charter)
Virginia | 54-0585263 | |
(State or other jurisdiction of | (I.R.S. Employer | |
incorporation or organization) | Identification No.) |
102 Westside Blvd., N.W., Roanoke, Virginia 24017
(Address of principal executive offices) (Zip Code)
(540)342-1831
(Registrant's telephone number, including area code )
N/A
(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 Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, 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 Registrant's classes of common stock, as of January 31, 2001.
10,901,063 Shares outstanding
ROANOKE ELECTRIC STEEL CORPORATION
FORM 10-Q
CONTENTS
Item 1. Financial Statements | |
a. Consolidated Balance Sheets | |
b. Consolidated Statements of Earnings | |
c. Consolidated Statements of Cash Flows | |
d. Tables Related to- Notes to Consolidated Financial Statements | |
Item 2. Table Related to- Management's Discussion and Analysis of Financial Condition | |
and Results of Operations | |
3.Signatures |
PART I - FINANCIAL INFORMATION | |||||
ITEM 1 - FINANCIAL STATEMENTS | |||||
ROANOKE ELECTRIC STEEL CORPORATION | |||||
Consolidated Balance Sheets | |||||
ASSETS | |||||
(Unaudited) | |||||
January 31, | October 31, | ||||
2001 | 2000 | ||||
CURRENT ASSETS | |||||
Cash and cash equivalents | $ | 14,369,616 | $ | 15,068,443 | |
Investments | 12,286,883 | 12,739,623 | |||
Accounts receivable, net of allowances of | |||||
$2,868,611 in 2001 and $2,522,930 in 2000 | 45,421,656 | 50,017,765 | |||
Refundable income taxes | 1,149,442 | 1,214,045 | |||
Inventories | 75,076,043 | 76,449,212 | |||
Prepaid expenses | 1,324,715 | 1,185,033 | |||
Deferred income taxes | 5,600,031 | 5,600,031 | |||
Total current assets | 155,228,386 | 162,274,152 | |||
PROPERTY, PLANT AND EQUIPMENT | |||||
Land | 8,077,943 | 8,077,943 | |||
Buildings | 43,515,184 | 43,457,981 | |||
Other property and equipment | 197,277,394 | 196,768,095 | |||
Assets under construction | 5,048,588 | 4,491,428 | |||
Total | 253,919,109 | 252,795,447 | |||
Less--accumulated depreciation | 95,501,424 | 91,322,382 | |||
Property, plant and equipment, net | 158,417,685 | 161,473,065 | |||
GOODWILL | 14,476,033 | 14,678,495 | |||
OTHER ASSETS | 1,225,891 | 1,253,197 | |||
TOTAL ASSETS | $ | 329,347,995 | $ | 339,678,909 | |
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||
CURRENT LIABILITIES | |||||
Current portion of long-term debt | $ | 15,039,488 | $ | 15,036,469 | |
Accounts payable | 18,298,875 | 18,546,646 | |||
Dividends payable | 1,090,106 | 1,090,106 | |||
Employees' taxes withheld | 389,631 | 505,409 | |||
Accrued profit sharing contribution | 690,520 | 3,721,201 | |||
Accrued wages and expenses | 9,016,247 | 11,930,242 | |||
Total current liabilities | 44,524,867 | 50,830,073 | |||
LONG-TERM DEBT | |||||
Notes payable | 120,152,143 | 123,910,990 | |||
Less--current portion | 15,039,488 | 15,036,469 | |||
Total long-term debt | 105,112,655 | 108,874,521 | |||
DEFERRED INCOME TAXES | 31,613,088 | 31,575,856 | |||
OTHER LIABILITIES | 3,986,175 | 3,676,630 | |||
STOCKHOLDERS' EQUITY | |||||
Common stock--no par value--authorized 20,000,000 shares, | |||||
issued 12,174,177 shares | 3,968,765 | 3,968,765 | |||
Retained earnings | 141,105,463 | 141,570,932 | |||
Accumulated other comprehensive income | (145,150) | --- | |||
Total | 144,929,078 | 145,539,697 | |||
Less--treasury stock, 1,273,114 shares -- at cost | 817,868 | 817,868 | |||
Total stockholders' equity | 144,111,210 | 144,721,829 | |||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 329,347,995 | $ | 339,678,909 | |
The accompanying notes to consolidated financial statements are an integral part of these statements. | |||||
ROANOKE ELECTRIC STEEL CORPORATION | |||||
Consolidated Statements of Earnings | |||||
(Unaudited) | |||||
Three Months Ended | |||||
January 31, | |||||
2001 | 2000 | ||||
SALES | $ | 74,771,535 | $ | 91,405,132 | |
COST OF SALES | 65,144,376 | 74,954,329 | |||
GROSS EARNINGS | 9,627,159 | 16,450,803 | |||
OTHER OPERATING EXPENSES | |||||
Administrative | 6,420,753 | 6,446,297 | |||
Interest, net | 1,785,274 | 1,775,841 | |||
Profit sharing | 384,216 | 1,528,977 | |||
Total | 8,590,243 | 9,751,115 | |||
EARNINGS BEFORE INCOME TAXES | 1,036,916 | 6,699,688 | |||
INCOME TAX EXPENSE | 412,279 | 2,745,305 | |||
NET EARNINGS | $ | 624,637 | $ | 3,954,383 | |
Net earnings per share of common stock: | |||||
Basic | $ | 0.06 | $ | 0.36 | |
Diluted | $ | 0.06 | $ | 0.36 | |
Cash dividends per share of common stock | $ | 0.10 | $ | 0.10 | |
Weighted average number of common shares outstanding : | |||||
Basic | 10,901,063 | 11,007,766 | |||
Diluted | 10,916,163 | 11,086,019 | |||
The accompanying notes to consolidated financial statements are an integral part of these statements. | |||||
ROANOKE ELECTRIC STEEL CORPORATION | |||||
Consolidated Statements of Cash Flows | |||||
(Unaudited) | |||||
Three Months Ended | |||||
January 31, | |||||
2001 | 2000 | ||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||
Net earnings | $ | 624,637 | $ | 3,954,383 | |
Adjustments to reconcile net earnings to net | |||||
cash provided by operating activities: | |||||
Deferred compensation liability | (10,851) | 109,504 | |||
Postretirement liabilities | 78,478 | 78,478 | |||
Depreciation and amortization | 4,417,853 | 4,215,527 | |||
Loss on sale of investments and property, plant and equipment | 13,756 | 1,339 | |||
Deferred income taxes | 134,000 | (346,476) | |||
Changes in assets and liabilities which provided | |||||
(used) cash, exclusive of changes shown separately | (414,026) | (2,782,404) | |||
Net cash provided by operating activities | 4,843,847 | 5,230,351 | |||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||
Expenditures for property, plant and equipment | (1,144,521) | (3,669,105) | |||
Proceeds from sale of property, plant and equipment | 500 | 94 | |||
(Purchase) sale of investments | 441,344 | (200,668) | |||
Other | 8,956 | (162,348) | |||
Net cash used in investing activities | (693,721) | (4,032,027) | |||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||
Cash dividends | (1,090,106) | (1,098,219) | |||
Decrease in dividends payable | --- | (4,360) | |||
Proceeds from exercise of common stock options | --- | 123,399 | |||
Payment of long-term debt | (3,758,847) | (3,758,189) | |||
Repurchase of common stock | --- | (983,250) | |||
Net cash used in financing activities | (4,848,953) | (5,720,619) | |||
NET DECREASE IN CASH AND CASH EQUIVALENTS | (698,827) | (4,522,295) | |||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 15,068,443 | 33,286,934 | |||
CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | 14,369,616 | $ | 28,764,639 | |
CHANGES IN ASSETS AND LIABILITIES WHICH PROVIDED | |||||
(USED) CASH, EXCLUSIVE OF CHANGES SHOWN SEPARATELY | |||||
(Increase) decrease in accounts receivable | $ | 4,596,109 | $ | 8,421,587 | |
(Increase) decrease in refundable income taxes | 64,603 | --- | |||
(Increase) decrease in inventories | 1,373,169 | (7,887,376) | |||
(Increase) decrease in prepaid expenses | (139,682) | 80,756 | |||
Increase (decrease) in accounts payable | (247,771) | 1,415,849 | |||
Increase (decrease) in employees' taxes withheld | (115,778) | (26,844) | |||
Increase (decrease) in accrued profit sharing contribution | (3,030,681) | (4,554,871) | |||
Increase (decrease) in accrued wages and expenses | (2,913,995) | (2,731,757) | |||
Increase (decrease) in accrued income taxes | --- | 2,500,252 | |||
Total | $ | (414,026) | $ | (2,782,404) | |
The accompanying notes to consolidated financial statements are an integral part of these statements. | |||||
Table Related to Footnote 2.
(UNAUDITED) | ||||||
January 31, | October 31, | |||||
2001 | 2000 | |||||
Scrap steel | $ | 4,734,625 | $ | 5,721,583 | ||
Melt supplies | 3,354,915 | 3,318,385 | ||||
Billets | 16,804,169 | 17,266,805 | ||||
Mill supplies | 4,297,097 | 3,485,332 | ||||
Work-in-process | 6,535,714 | 6,877,954 | ||||
Finished steel | 39,349,523 | 39,779,153 | ||||
Total inventories | $ | 75,076,043 | $ | 76,449,212 | ||
Table Related to Footnote 5.
(UNAUDITED) | ||||||
Three Months Ended | ||||||
January 31, | ||||||
2001 | 2000 | |||||
Net earnings: | $ | 624,637 | $ | 3,954,383 | ||
Cumulative effect of change in | ||||||
accounting for derivative | ||||||
financial instruments | 1,663,516 | --- | ||||
Change in derivative financial | ||||||
instruments | (1,808,666) | --- | ||||
Total comprehensive income | $ | 479,487 | $ | 3,954,383 | ||
Table Related to Footnote 6.
Financial Information Relating | ||||||
to Classes of Products | ||||||
(UNAUDITED) | ||||||
Three Months Ended | ||||||
January 31, | ||||||
2001 | 2000 | |||||
Sales to unaffiliated customers: | ||||||
Merchant steel and specialty | ||||||
steel sections | $ | 44,942,549 | $ | 56,116,071 | ||
Bar joists and rebar | 28,584,876 | 30,141,613 | ||||
Billets | 1,244,110 | 5,147,448 | ||||
Total consolidated sales | $ | 74,771,535 | $ | 91,405,132 | ||
Table Related to Footnote 7.
(UNAUDITED) | ||||||
Three Months Ended | ||||||
January 31, | ||||||
2001 | 2000 | |||||
Cash paid during the period for: | ||||||
Interest | $ | 2,225,934 | $ | 2,501,240 | ||
Income taxes | $ | 213,676 | $ | 591,530 | ||
Table Related to - Management's Discussion and Analysis of Financial Condition and Results of Operations
Comparison of Increases (Decreases) | ||||
Three Months Ended | ||||
January 31, | ||||
2001 and 2000 | ||||
Amount | Percent | |||
Sales | (16,633,597) | (18.2) | ||
Cost of Sales | (9,809,953) | (13.1) | ||
Administrative Expenses | (25,544) | (0.4) | ||
Interest Expense | 9,433 | 0.5 | ||
Profit Sharing Expense | (1,144,761) | (74.9) | ||
Earnings before Income Taxes | (5,662,772) | (84.5) | ||
Income Tax Expense | (2,333,026) | (85.0) | ||
Net Earnings | (3,329,746) | (84.2) | ||
Signatures
SIGNATURES
ROANOKE ELECTRIC STEEL CORPORATION | ||
Registrant | ||
Date | March 21, 2001 | Donald G. Smith |
Donald G. Smith, Chairman, President, | ||
Treasurer and Chief Executive Officer | ||
(Principal Financial Officer) | ||
Date | March 21, 2001 | John E. Morris |
John E. Morris, Vice President-Finance | ||
and Assistant Treasurer | ||
(Chief Accounting Officer) | ||