Total pages included - 15
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, 2002
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 1-4347
ROGERS CORPORATION
(Exact name of Registrant as specified in its charter)
Massachusetts 06-0513860
(State or other jurisdiction of (I. R. S. Employer
incorporation or organization) Identification No.)
P.O. Box 188, One Technology Drive, Rogers, Connecticut 06263-0188
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (860) 774-9605
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
The number of shares outstanding of the Registrant's classes of common
stock as of April 28, 2002:
Capital Stock, $1 Par Value - 15,809,143 shares
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ROGERS CORPORATION AND SUBSIDIARIES
FORM 10-Q
March 31, 2002
INDEX
Page No.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited):
Consolidated Statements of Income --
Three Months Ended March 31, 2002 and
April 1, 2001 3
Consolidated Balance Sheets --
March 31, 2002 and December 30, 2001 4-5
Consolidated Statements of Cash Flows --
Three Months Ended March 31, 2002 and
April 1, 2001 6
Supplementary Notes 7-12
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 12-14
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 15
Item 6. Reports on Form 8-K 15
SIGNATURES 15
- 2 -
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ROGERS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in Thousands Except Per Share Amounts)
Three Months Ended:
(Unaudited)
March 31, 2002 April 1, 2001
-------------- -------------
Net Sales $ 54,558 $ 63,750
Cost of Sales 38,315 43,096
Selling and Administrative Expenses 10,109 10,145
Research and Development Expenses 3,465 3,125
-------------- -------------
Total Costs and Expenses 51,889 56,366
-------------- -------------
Operating Income 2,669 7,384
Other Income less Other Charges 2,607 2,119
Interest Income (Expense), Net (97) 99
-------------- -------------
Income Before Income Taxes 5,179 9,602
Income Taxes:
Federal and Foreign 1,256 2,781
State 39 100
-------------- -------------
Net Income $ 3,884 $ 6,721
============== =============
Net Income Per Share (Note E):
Basic $ .25 $ .44
============== =============
Diluted $ .24 $ .42
============== =============
Shares Used in Computing (in thousands) (Note E):
Basic 15,403 15,178
============== =============
Diluted 16,049 16,023
============== =============
The accompanying notes are an integral part of the consolidated
financial statements.
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ROGERS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
(Dollars in Thousands)
(Unaudited)
March 31, 2002 December 30, 2001
Current Assets:
Cash and Cash Equivalents $ 8,612 $ 20,891
Accounts Receivable, Net 32,987 27,460
Account Receivable, Joint Ventures 6,462 5,123
Inventories:
Raw Materials 8,790 10,003
In-Process and Finished 17,008 15,372
-------------- -----------------
Total Inventories 25,798 25,375
Current Deferred Income Taxes 5,041 5,041
Other Current Assets 1,581 1,026
-------------- -----------------
Total Current Assets 80,481 84,916
-------------- -----------------
Property, Plant and Equipment, Net of
Accumulated Depreciation of
$93,471and $90,015 98,646 98,454
Investments in Unconsolidated Joint
Ventures 14,876 16,116
Pension Asset 6,308 6,308
Goodwill and Other Intangibles, Net 22,163 13,588
Other Assets 5,305 4,427
-------------- ----------------
Total Assets $ 227,779 $ 223,809
============== ================
The accompanying notes are an integral part of the consolidated financial
statements.
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ROGERS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - CONTINUED
LIABILITIES AND SHAREHOLDERS' EQUITY
(Dollars in Thousands)
(Unaudited)
March 31, 2002 December 30, 2001
Current Liabilities:
Accounts Payable $ 10,282 $ 12,009
Accrued Employee Benefits and
Compensation 8,564 6,974
Accrued Income Taxes Payable 7,126 6,337
Taxes, Other than Federal and Foreign
Income 528 441
Other Accrued Liabilities 4,615 3,931
---------- ----------
Total Current Liabilities 31,115 29,692
---------- ----------
Long-Term Debt 3,312 1,315
Noncurrent Deferred Income Taxes 8,105 8,152
Noncurrent Pension Liability 9,171 12,371
Noncurrent Retiree Health Care and Life
Insurance Benefits 6,052 6,052
Other Long-Term Liabilities 2,883 3,165
Shareholders' Equity:
Capital Stock, $1 Par Value:
Authorized Shares 50,000,000; Issued
Shares 15,767,811 and 15,739,184 15,768 15,739
Additional Paid-In Capital 35,517 35,351
Retained Earnings 133,322 129,438
Accumulated Other Comprehensive Loss (4,326) (4,030)
Treasury Stock
(373,940 and 382,900 shares) (13,140) (13,436)
---------- ----------
Total Shareholders' Equity 167,141 163,062
---------- ----------
Total Liabilities and
Shareholders' Equity $ 227,779 $ 223,809
========== ==========
The accompanying notes are an integral part of the consolidated financial
statements.
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ROGERS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
Three Months Ended:
March 31, April 1,
2002 2001
CASH FLOWS PROVIDED BY (USED IN)
OPERATING ACTIVITIES:
Net Income $ 3,884 $ 6,721
Adjustments to Reconcile Net
Income to Net Cash Provided by
(Used in) Operating Activities:
Depreciation and Amortization 3,656 3,762
Expense (Benefit) for Deferred
Income Taxes 34 --
Equity in Undistributed (Income) Loss
of Unconsolidated Joint Ventures, Net (1,713) (516)
Noncurrent Pension and Postretirement
Benefits (3,026) (2)
Other, Net (307) (269)
Changes in Operating Assets and
Liabilities:
Accounts Receivable (5,453) (4,232)
Accounts Receivable - Affiliates (1,338) (1,196)
Inventories (496) (1,512)
Other Current Assets (566) 32
Accounts Payable and Accrued Expenses 1,768 (2,294)
-------- --------
Net Cash Provided by (Used in)
Operating Activities (3,557) 494
CASH FLOWS PROVIDED BY (USED IN)
INVESTING ACTIVITIES:
Capital Expenditures (2,470) (2,674)
Acquisition of Businesses (8,000) --
Investment in Unconsolidated Joint
Ventures and Affiliates 2,962 706
-------- --------
Net Cash (Used in)
Investing Activities (7,508) (1,968)
CASH FLOWS PROVIDED BY (USED IN)
FINANCING ACTIVITIES:
Proceeds from Short and Long-Term Borrowings 3,322 67
Repayments of Debt Principal (1,724) (67)
Repayment of Life Insurance Note (3,081) --
Disposition of Treasury Stock 214 --
Proceeds from Sale of Capital Stock 268 176
------- -------
Net Cash Provided by (Used in)
Financing Activities (1,001) 176
Effect of Exchange Rate Changes on Cash (213) 501
------- -------
Net Increase/(Decrease) in Cash and
Cash Equivalents (12,279) (797)
Cash and Cash Equivalents at Beginning of Year 20,891 10,100
------- -------
Cash and Cash Equivalents at End of Quarter $ 8,612 $ 9,303
======= =======
The accompanying notes are an integral part of the consolidated financial
statements.
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ROGERS CORPORATION AND SUBSIDIARIES
SUPPLEMENTARY NOTES
(Unaudited)
A. The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management,
all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. All significant
intercompany transactions have been eliminated. For further information,
refer to the audited consolidated financial statements and footnotes
thereto included in the Company's annual report on Form 10-K for the
fiscal year ended December 30, 2001.
B. Interest paid during the first three months of 2002 and 2001 was $199,000
and $342,000, respectively.
C. Income taxes paid were $2,000 and $0 in the first three months of 2002
and 2001, respectively.
D. The components of other comprehensive loss, net of related tax, for the
three-month periods ended March 31, 2002 and April 1, 2001 are as follows:
Three Months Ended
(Dollars in Thousands)
March 31, 2002 April 1, 2001
Net income $ 3,884 $ 6,721
Foreign currency translation adjustment (296) (504)
--------- ---------
Comprehensive income $ 3,588 $ 6,217
========= =========
Accumulated balances related to each component of Other Comprehensive
Loss are as follows:
March 31, 2002 December30, 2001
Foreign currency translation
adjustments $ (1,423) $ (1,127)
Minimum pension liability (2,903) (2,903)
--------- ---------
$ (4,326) $ (4,030)
========= =========
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SUPPLEMENTARY NOTES, CONTINUED
(Unaudited)
E. The following table sets forth the computation of basic and diluted
earnings per share in conformity with Statement of Financial Accounting
Standards (FAS) No. 128, "Earnings per Share":
(Dollars in Thousands, Except Per Share Amounts)
March 31, April 1,
2002 2001
Numerator:
Net income $ 3,884 $ 6,721
Denominator:
Denominator for basic earnings per share -
weighted-average shares 15,403 15,178
Effect of stock options 646 845
Denominator for diluted earnings per
share - adjusted weighted-average
shares and assumed conversions 16,049 16,023
======= =======
Basic earnings per share $ .25 $ .44
======= =======
Diluted earnings per share $ .24 $ .42
======= =======
F. The following table sets forth the information about the Company's
operating segments in conformity with Statement of Financial Accounting
Standards (FAS) No. 131, "Disclosures about Segments of an Enterprise
and Related Information":
High Printed Polymer
Performance Circuit Materials &
Foams Materials Components Total
(Dollars in Millions)
Three Months ended
March 31, 2002
Net Sales $15.7 $19.5 $19.4 $54.6
Operating Income 1.6 0.4 0.7 2.7
Three Months ended
April 1, 2001
Net Sales $13.8 $27.3 $22.7 $63.8
Operating Income 1.7 4.5 1.2 7.4
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SUPPLEMENTARY NOTES, CONTINUED
(Unaudited)
Inter-segment sales, which are generally priced with reference to costs
or prevailing market prices, are not material in relation to consolidated
net sales and have been eliminated from the sales data in the previous
tables.
G. The Company is subject to federal, state, and local laws and regulations
concerning the environment and is currently engaged in proceedings related
to such matters.
The Company is currently involved as a potentially responsible party (PRP)
in two cases involving waste disposal sites, both of which are Superfund
sites. These proceedings are at a stage where it is still not possible to
estimate the cost of remediation, the timing and extent of remedial action
which may be required by governmental authorities, and the amount of
liability, if any, of the Company alone or in relation to that of any
other PRPs. The Company also has been seeking to identify insurance
coverage with respect to these matters. Where it has been possible to
make a reasonable estimate of the Company's liability, a provision has
been established. Insurance proceeds have only been taken into account
when they have been confirmed by or received from the insurance company.
Actual costs to be incurred in future periods may vary from these
estimates. Based on facts presently known to it, the Company does not
believe that the outcome of these proceedings will have a material adverse
effect on its financial position.
In addition to the above proceedings, the Company has been actively working
with the Connecticut Department of Environmental Protection (CT DEP) related
to certain polychlorinated biphenyl (PCB) contamination in the soil beneath
a section of cement flooring at its Woodstock, Connecticut facility. The
Company completed clean-up efforts in 2000, monitored the site in 2001,
and will continue to monitor the site in 2002 and 2003. On the basis of
estimates prepared by environmental engineers and consultants, the Company
recorded a provision of $2,200,000 prior to 1999 and based on updated
estimates provided an additional $400,000 in 1999 for costs related to
this matter. Prior to 1999, $900,000 was charged against this provision.
In 1999, 2000, and 2001 expenses of $400,000, $900,000, and $100,000 were
charged, respectively, against the provision. No amount has been charged
to the reserves for the first three months of 2002. The remaining amount
in the reserve is primarily for testing, monitoring, sampling and any minor
residual treatment activity. Management believes, based on facts currently
available, that the balance of this provision is adequate to complete the
project.
In this same matter the United States Environmental Protection Agency
(EPA) has alleged that the Company improperly disposed of PCBs. An
administrative law judge found the Company liable for this alleged
disposal and assessed a penalty of approximately $300,000. The Company
reflected this fine in expense in 1998 but disputed the EPA allegations
and appealed the administrative law judge's findings and penalty
assessment. The original findings were upheld internally by the EPA's
Environmental Appeals Board, and the Company placed that decision on
appeal with the District of Columbia Federal Court of Appeals in 2000.
In early January of 2002, the Company was informed that the Court of
Appeals reversed the decision. As a result of this favorable decision,
the $300,000 reserve for the fine was taken into income in 2001 as the
Company intends to vigorously resist any future attempts by the
government to impose a substantial fine.
- 9 -
SUPPLEMENTARY NOTES, CONTINUED
(Unaudited)
The Company has not had any material recurring costs and capital
expenditures relating to environmental matters, except as specifically
described in the preceding statements.
H. From time to time the Company's Board of Directors authorizes the
repurchase, at management's discretion, of shares of the Company's
capital stock. The most recent regular authorization was approved
on August 17, 2000 and provided for the repurchase of up to an aggregate
of $2,000,000 in market value of such stock. On October 24, 2001, the
Company's Board of Directors authorized, at management's discretion, the
repurchase of shares of the Company's capital stock in order to provide
participants in the Rogers Corporation Global Stock Ownership Plan For
Employees (see Note M), an employee stock purchase plan, with shares of
such stock. This is just one of the ways shares can be provided to plan
participants. At year-end, neither authorization had been used to
repurchase stock. However, on December 31, 2001, 8,960 shares of
Treasury Stock were used to provide the plan participants the shares
for the initial plan period that was initiated on October 1, 2001 and
concluded on December 31, 2001. As of March 31, 2002, Treasury Stock
totals 373,940 shares and is shown at cost on the balance sheet as a
reduction of Shareholders' Equity.
I. On February 7, 2001, the Company entered into a definitive agreement
to purchase the Advanced Dielectric Division (ADD) of Tonoga, Inc.
(commonly known as Taconic), which operates facilities in Petersburgh,
New York and Mullingar, Ireland. On May 11, 2001, the Company announced
that active discussions with Taconic to acquire the ADD business had been
suspended and it was not anticipated that the acquisition would occur.
Accordingly, $1,500,000 in costs associated with this potential acquisition
were written off during the second quarter of 2001. On October 23, 2001,
the Company terminated the acquisition agreement.
On October 24, 2001, a breach of contract lawsuit was filed against
the Company in the United States District Court for the District of
Connecticut seeking damages in the amount of $25,000,000 or more, as
well as specific performance and attorneys' fees (Tonoga, Ltd., d/b/a
Taconic Plastics Ltd., Tonoga, Inc., Andrew G. Russell, and James M.
Russell v. Rogers Corporation). The complaint alleges that the Company
breached its agreement to purchase Taconic's Advanced Dielectric
Division. The Company believes that several conditions precedent to a
closing contained in the relevant agreement were not satisfied by Taconic,
and that the litigation is without merit. The Company intends to
vigorously defend the lawsuit.
J. Other income less other charges was $2,600,000 in the first quarter
of 2002 compared to $2,100,000 in the same period in 2001. The increase
is primarily due to the performance of Rogers joint ventures, particularly
Durel Corporation and Rogers Inoac Corporation (RIC), partially offset by
lower royalty income.
K. In the second quarter of 2001, the Company incurred a restructuring charge
in the amount of $500,000. This amount primarily consists of $300,000 in
severance benefits
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SUPPLEMENTARY NOTES, CONTINUED
(Unaudited)
for the termination of 19 employees in the Printed Circuit Materials
segment and $200,000 in costs associated with the merging of two business
units within the segment. All 19 of these employees were terminated during
the second quarter. The balance in the accrual at March 31, 2002
was $27,000.
L. In June 2001, the Financial Accounting Standards Board issued Statements
of Financial Accounting Standards No. 141, Business Combinations, and
No. 142, Goodwill and Other Intangible Assets. Statement 141 requires
that the purchase method of accounting be used for all business combinations
initiated after June 30, 2001. Statement 141 also includes guidance on the
initial recognition and measurement of goodwill and other intangible assets
arising from business combinations completed after June 30, 2001. Statement
142 prohibits the amortization of goodwill and intangible assets with
indefinite useful lives. Statement 142 requires that these assets be
reviewed for impairment at least annually. Intangible assets with finite
lives will continue to be amortized over their estimated useful lives.
The Company has applied Statements 141 and 142 beginning in the first
quarter of 2002. Application of the nonamortization provisions of Statement
142 resulted in an increase in net income of $83,000 in the first quarter
of 2002. Management is currently in the process of conducting the first
step of the impairment reviews for its goodwill and expects to complete
this assessment no later than the second quarter of 2002, in accordance
with the provisions of this standard. Although more analysis is
necessary, a preliminary review indicates that there is no impairment
of goodwill.
M. In 2001, shareholders approved the Rogers Corporation Global Stock
Ownership Plan for Employees, an employee stock purchase plan. The plan
provides for the issuance of up to 500,000 shares of Company stock.
Shares may be purchased by participating employees through payroll
deductions that are made during prescribed offering periods with the
actual purchases made at the end of each offering period. Currently,
shares may be purchased at 85% of the stock's closing price at the
beginning or end of each offering period, whichever is lower, and
other rules have been established for participation in the plan.
N. As of December 31, 2001 (fiscal year 2002), the Company acquired certain
assets of the high performance foam business of Cellect LLC for
approximately $10,000,000 in cash, plus a potential earn out in five
years based upon performance. These assets included intellectual
property rights, machinery and equipment, and customer lists for
portions of the Cellect plastomeric and elastomeric high performance
polyolefin foam business. The acquisition was accounted for as a
purchase. A portion of the purchase price has been allocated to
property, plant and equipment. The remainder of the purchase
price will be allocated to intangible assets based on their respective
fair values at the date of acquisition.
The acquisition of Cellect will be easily integrated into Rogers High
Performance Foams. The product portfolio acquired increases the
variety of offerings in this segment and provides Rogers with a
lower density and less expensive product
- 11 -
grouping, thus providing the ability to expand the Company's market
share. In addition, the intellectual property obtained (18 patents)
should enable the Company to develop new products to add to its High
Performance Foam portfolio. However, the acquisition is only expected
to be modestly accretive to earnings in 2002.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Net sales in the first quarter of 2002 were $54.6 million were down about
14% compared to $63.8 million in the first quarter of 2001, which was a
record quarter for the Company. Combined Sales, which include one half of
the sales from Rogers' four 50% owned joint ventures, were $68.7 million for
the quarter, down from the $77 million reported in the first quarter of 2001.
For comparative purposes, Combined Sales amounts for 2001 have been adjusted
for the divestiture of the ENDUR(R) elastomer components portion of Rogers
Inoac Corporation (RIC), which took place in January 2002. Although sales
were down from the first quarter of 2001, revenues across most of the
Company's product lines improved from the fourth quarter of 2001, reflecting
the general upturn in the economy.
High Performance Foam sales were $15.7 million for this year's first quarter
up almost 14% from quarter one last year. Revenues in this business segment
increased, in part, due to sales from the newly acquired Cellect product lines.
Some of the other reasons for higher revenues in this segment of the Company's
business were stronger sales into the cell phone and imaging markets.
Sales of Printed Circuit Materials for the quarter totaled $19.5 million, a
decrease of over 28% compared to the first quarter of 2001. Lower sales of
flexible materials in the first quarter offset the continuing improvement in
sales of both high frequency and shielding materials.
Sales of Polymer Materials and Components decreased by over 14% from the
comparable 2001 period. This decline was primarily due to the slowdown in
sales to the office automation market and increased pricing pressure for
these product lines.
First quarter 2002 net income was $3.9 million and diluted earnings per share
were $.24, as compared to $6.7 million in net income and $.42 in diluted
earnings per share earned in last year's first three months. The decreases
were due mostly to lower revenues resulting from the economic downturn
that affected the Company's businesses after the first quarter of 2001.
Manufacturing profit as a percentage of sales was 30% in the first quarter
of 2002 and 32% in the first quarter of 2001. The impact of lower revenues
and lower margins for the product lines related to the Cellect acquistion
masked the Company's gains as it continued to focus on process
improvement and benefits derived from cost reduction efforts taken in 2001.
Selling and administrative expenses for the first three months of 2002 were
approximately the same in total dollars, but up as a percentage of sales from
16% in the first quarter of 2001 to 18% due to lower revenues.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS, CONTINUED
Research and development expenses of $3.5 million in the first quarter of
2002 were slightly higher than the $3.1 million in the comparable period in
2001. This increase is due to the cost of additional technical personnel.
Net interest income (expense) for 2002 remained about the same as the
comparable period in 2001.
Other income was $2.6 million in the first quarter of 2002 compared to $2.1
million in the comparable period in 2001. The increase is due primarily to
the performance of Rogers joint ventures, partially offset by reduced
royalties. Rogers' joint ventures in total had a very good first quarter.
Revenues at Durel Corporation, Rogers joint venture with 3M,
were almost 22% higher for the first quarter of 2002 compared to the first
quarter of 2001. Durel's sales to the automotive segment were up as
anticipated, and shipments for cell phones were better than expected.
Profitability at Durel continued to improve as cost cutting and productivity
gains continued to take hold. Reduced overhead and direct labor during the
first quarter contributed to these gains. The sale of the ENDUR elastomer
components business at Rogers Inoac Corporation (RIC), Rogers joint venture
with Inoac Corporation, reduced joint venture sales in the first quarter but
did not affect Rogers' income associated with the joint venture. Polyimide
Laminate Systems (PLS), Rogers joint venture with Mitsui Chemicals, Inc.
performance was down slightly from the first quarter of 2001 due to a
reduction in the average selling price of its products. Rogers Chang Chun
Technology Co., Ltd. (RCCT), Rogers joint venture with Chang Chun Plastics
Co., Ltd., officially opened its new plant in the fourth quarter of 2001.
In the first quarter of 2002, RCCT continues to work with customers to
qualify the products that will be produced. The first sales are anticipated
in the second quarter of 2002.
The effective tax rate used in the first quarter of 2002 was 25% as compared
to 29% used in the first quarter of 2001. The tax rate has benefited primarily
from foreign tax credits, research and development credits, and nontaxable
foreign sales income.
Net cash used by operating activities in the first three months of 2002 totaled
$3.6 million. This compares with $500,000 provided by operations for the
comparable 2001 period. This difference is primarily attributable to lower
net income, increase in non-cash working capital from the fourth quarter 2001
and voluntary early contributions to the Company's pension plans.
In 2002, investments in capital equipment totaled $2.5 million in the first
quarter and are expected to approach $15 million for the year. In 2001,
capital expenditures in the first quarter were $2.7 million and they finished
at $18 million for the year.
Management believes that cash on hand, and internally generated funds will
be sufficient to meet the near term, regular needs of the business. In
addition, the Company has an unsecured multi-currency revolving credit
agreement with two domestic banks and can borrow up to $75 million,
or the equivalent in certain other foreign currencies. There were no
borrowings at March 31, 2002 under this agreement.
In September 2001, Rogers N.V., a Belgian subsidiary of the Company, signed
an unsecured revolving credit agreement with a European bank. Under this
arrangement Rogers N.V. now can borrow up to 6.2 million Euro. Amounts
borrowed under this agreement are to be repaid in full
- 13 -
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS, CONTINUED
by May 1, 2005. The rate of interest charged on outstanding loans is
based on the Euribor plus 25 basis points. At March 31, 2002, Rogers N.V.
had borrowings of 3.8 million Euro (US$3.3 million) under this agreement.
During the first quarter of 2002 there were no material developments relative
to environmental matters or other contingencies. Refer to Note G and Note I
for ongoing environmental and contingency matters.
The Company has not had any material recurring costs and capital expenditures
relating to environmental matters, except as specifically described in the
preceding statements.
Statements in this report that are not strictly historical may be deemed to
be "forward-looking" statements which should be considered as subject to the
many uncertainties that exist in the Company's operations and environment.
These uncertainties, which include economic conditions, market demand and
pricing, competitive and cost factors, rapid technological change, new product
introductions, and the like, are incorporated by reference in the Rogers
Corporation 2001 Form 10-K filed with the Securities and Exchange Commission.
Such factors could cause actual results to differ materially from those in
the forward-looking statements.
- 14 -
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
On October 24, 2001, a breach of contract lawsuit was filed
against the Company in the United States District Court for the
District of Connecticut seeking damages in the amount of $25 million
or more, as well as specific performance and attorneys' fees
(Tonoga, Ltd., d/b/a Taconic Plastics Ltd., Tonoga, Inc.,
Andrew G. Russell, and James M. Russell v. Rogers Corporation).
The complaint alleges that the Company breached its agreement to
purchase Taconic's Advanced Dielectric Division. The Company believes
that several conditions precedent to a closing contained in the
relevant agreement were not satisfied by Taconic, and that the
litigation is without merit. The Company intends to vigorously
defend the lawsuit.
Item 6. Exhibits and Reports on Form 8-K
(a) List of Exhibits: None
(b) There were no reports on Form 8-K filed for the three months
ended March 31, 2002.
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.
ROGERS CORPORATION
(Registrant)
/s/James M. Rutledge
----------------------------
James M. Rutledge
Vice President, Finance and
Chief Financial Officer
Dated: May 10, 2002
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