SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15 (d)
of the Securities Exchange Act of 1934
For the Quarter Ended February 28, 2003
Commission File No. 1-4714
SKYLINE CORPORATION
(Exact name of registrant as specified in its charter)
INDIANA 35-1038277
(State of Incorporation) (IRS Employee Identification No.)
P. O. Box 743, 2520 By-Pass Road Elkhart, IN 46515
(Address of principal executive offices) (Zip)
294-6521 (574)
(Registrant's telephone number) (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
Securities registered pursuant to Section 12 (b) of the Act:
Shares Outstanding
Title of Class April 14, 2003
Common stock 8,391,244
SKYLINE CORPORATION
Form 10-Q Quarterly Report
INDEX
Page No.
Part I. Financial Information
Item 1.
Financial Statements:
Consolidated Balance Sheets as 2-3
of February 28, 2003 and May 31, 2002
Consolidated Statements of Earnings and 4
Retained Earnings for the three-month and
nine-month periods ended February 28, 2003
and 2002
Consolidated Statements of Cash Flows 5-6
for the nine-month periods ended
February 28, 2003 and 2002
Notes to the Consolidated Financial 7-10
Statements for the nine-month period
ended February 28, 2003
Report of Independent Accountants 11
Item 2.
Management's Discussion and Analysis 12-14
of Financial Condition and Results of
Operations
Item 4.
Controls and Procedures 15
Part II Other Information
Item 1.
Legal Proceedings 15
Item 6.
Exhibits and Reports on Form 8-K 15
Signatures 16
Certifications 16-20
Part I.
Item 1. Financial Statements
Skyline Corporation and Subsidiary Companies
Consolidated Balance Sheets
Dollars in thousands
February 28, 2003 May 31, 2002
(Unaudited)
ASSETS
Current Assets
Cash $ 8,830 $ 8,699
Treasury Bills,
at cost plus accrued interest 143,674 138,327
Accounts receivable,
trade, less allowance for
doubtful accounts of $150 at
February 28, 2003 and
$40 at May 31, 2002 23,237 28,028
Inventories 9,514 9,632
Other current assets 8,635 8,137
Total Current Assets 193,890 192,823
Property, Plant and
Equipment, At Cost
Land 6,637 6,637
Buildings and improvements 64,788 64,595
Machinery and equipment 26,927 27,305
98,352 98,537
Less accumulated depreciation 58,469 57,060
Net Property, Plant and Equipment 39,883 41,477
Other Assets 4,653 4,452
$238,426 $238,752
The accompanying notes are a part of the consolidated financial statements.
Skyline Corporation and Subsidiary Companies
Consolidated Balance Sheets
Dollars in thousands except per share data
February 28, 2003 May 31, 2002
(Unaudited)
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable, trade $ 4,736 $ 5,859
Accrued salaries and wages 5,752 7,405
Accrued profit sharing 1,956 2,412
Accrued marketing programs 11,067 6,375
Accrued warranty and related expenses 10,508 10,100
Other accrued liabilities 3,633 3,156
Income taxes - 1,156
Total Current Liabilities 37,652 36,463
Other Deferred Liabilities 4,126 4,056
Commitments and Contingencies - -
Shareholders' Equity
Common stock, $.0277 par value,
15,000,000 shares authorized;
Issued 11,217,144 shares 312 312
Additional paid-in capital 4,928 4,928
Retained earnings 257,152 258,737
Treasury stock, at cost,
2,825,900 shares at
February 28, 2003 and May 31, 2002 (65,744) (65,744)
Total Shareholders' Equity 196,648 198,233
$238,426 $238,752
The accompanying notes are a part of the consolidated financial statements.
Skyline Corporation and Subsidiary Companies
Consolidated Statements of Earnings and Retained Earnings
For the three-month and nine-month periods ended February 28, 2003 and 2002
(Unaudited)
Dollars in thousands except per share data
Three-Months Ended Nine-Months Ended
February 28, February 28,
2003 2002 2003 2002
Sales $ 87,709 $ 96,080 $316,668 $336,359
Cost of sales 78,831 84,107 277,938 289,604
Gross profit 8,878 11,973 38,730 46,755
Selling and administrative
expenses 10,690 11,343 35,407 36,750
Operating (loss) earnings (1,812) 630 3,323 10,005
Interest income 465 831 1,605 3,501
(Loss) earnings before
income taxes (1,347) 1,461 4,928 13,506
(Benefit) provision
for income taxes:
Federal (419) 519 1,700 4,557
State (101) 73 282 769
(520) 592 1,982 5,326
Net (loss) earnings $ (827) $ 869 $ 2,946 $ 8,180
Basic (loss) earnings per share $ (.10) $ .10 $ .35 $ .97
Cash dividends per share $ .18 $ .18 $ .54 $ .54
Weighted average common
shares outstanding 8,391,244 8,391,244 8,391,244 8,391,244
Retained earnings,
beginning of period $259,489 $256,815 $258,737 $252,525
Add net (loss) earnings (827) 869 2,946 8,180
Less cash dividends paid 1,510 1,511 4,531 4,532
Retained earnings,
end of period $257,152 $256,173 $257,152 $256,173
The accompanying notes are a part of the consolidated financial statements.
Skyline Corporation and Subsidiary Companies
Consolidated Statements of Cash Flows
For the nine-month periods ended February 28, 2003 and 2002
Increase (Decrease) in Cash
(Unaudited)
Dollars in thousands
2003 2002
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings $ 2,946 $ 8,180
Adjustments to reconcile
net earnings to net cash
provided by operating activities:
Interest income earned on
U.S. Treasury Bills and Notes (1,605) (3,501)
Depreciation 2,811 2,855
Amortization of premium
on U.S. Treasury Notes - 6
Working Capital Items:
Accounts receivable 4,791 5,135
Inventories 118 (493)
Other current assets (498) 76
Accounts payable, trade (1,123) (1,715)
Accrued liabilities 3,468 6,213
Income taxes payable (1,156) (1,837)
Other assets (201) (175)
Other deferred liabilities 70 144
Total Adjustments 6,675 6,708
Net cash provided by operating activities 9,621 14,888
The accompanying notes are a part of the consolidated financial statements.
Skyline Corporation and Subsidiary Companies
Consolidated Statements of Cash Flows, continued
For the nine-months periods ended February 28, 2003 and 2002
Increase (Decrease) in Cash
(Unaudited)
Dollars in thousands
2003 2002
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale or maturity
of U. S. Treasury Bills $ 274,922 $ 310,800
Purchase of U.S. Treasury Bills (278,664) (343,367)
Maturity of U.S. Treasury Notes - 25,000
Interest received from U. S. Treasury Notes - 719
Proceeds from sale of property,
plant and equipment 76 20
Purchase of property, plant and equipment (1,293) (2,890)
Net cash used in investing activities (4,959) (9,718)
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash dividends paid (4,531) (4,532)
Net cash used in financing activities (4,531) (4,532)
Net increase in cash 131 638
Cash at beginning of year 8,699 5,450
Cash at end of quarter $ 8,830 $ 6,088
The accompanying notes are a part of the consolidated financial statements.
Skyline Corporation and Subsidiary Companies
Notes to the Consolidated Financial Statements
For the nine-month period ended February 28, 2003
NOTE 1 Nature of Operations and Accounting Policies
The accompanying unaudited interim consolidated financial statements contain
all adjustments (consisting of only normal recurring adjustments) necessary to
present fairly the consolidated financial position as of February 28, 2003, the
consolidated results of operations for three-month and nine-month periods ended
February 28, 2003 and 2002, and the consolidated cash flows for the nine-month
periods ended February 28, 2003 and 2002.
The unaudited interim consolidated financial statements included herein have
been prepared pursuant to the rules and regulations for reporting on Form 10-Q.
Accordingly, certain information and footnote disclosures normally accompanying
the annual consolidated financial statements have been omitted. The interim
consolidated financial statements should be read in conjunction with the
consolidated financial statements and notes thereto included in the
Corporation's latest annual report on Form 10-K.
Inventories are stated at cost, determined under the first-in, first-out
method, which is not in excess of market. Physical inventory counts are taken
at the end of each reporting quarter. Total inventories for the periods
presented consisted of (dollars in thousands):
February 28, 2003 May 31, 2002
Raw Materials $ 4,314 $ 4,280
Work In Process 5,134 5,183
Finished Goods 66 169
$ 9,514 $ 9,632
On November 25, 2002, the Financial Accounting Standards Board issued
Interpretation No. 45 "Guarantor's Accounting and Disclosure Requirements for
Guarantees, Including Indirect Guarantees of Indebtedness of Others". This
Interpretation elaborates on the evaluation of guarantees and the disclosures
to be made by a guarantor in its interim and annual financial statements about
its obligations under certain guarantees it has issued. The Corporation
currently has obligations regarding its guarantees for warranty and repurchase
agreements. Interpretation No. 45 was adopted in the third quarter of fiscal
2003 with no material impact.
The Corporation provides the retail purchaser of its manufactured homes with a
one-year warranty against defects in design, materials and workmanship.
Recreational vehicles are covered by a two-year warranty.
Skyline Corporation and Subsidiary Companies
Notes to the Consolidated Financial Statements (continued)
For the nine-month period ended February 28, 2003
NOTE 1 Nature of Operations and Accounting Policies
The warranties are backed by a corporate service department and an extensive
field service system. Estimated warranty costs are accrued at the time of sale
based upon current sales, historical experience and management's judgment
regarding anticipated rates of warranty claims. The adequacy of the recorded
warranty liability is periodically assessed and the amount is adjusted as
necessary. A reconciliation of accrued warranty and related expenses is as
follows (dollars in thousands):
Nine-Months Ended Year Ended
February 28, 2003 May 31, 2002
Balance at the beginning
of the period $ 10,100 $ 10,084
Accruals for warranties 8,678 12,853
Settlements made during the period (8,270) (12,837)
Balance at the end of the period $ 10,508 $ 10,100
The Corporation was contingently liable at February 28, 2003 under repurchase
agreements with certain financial institutions providing inventory financing
for retailers of its products. Under these arrangements, which are customary
in the manufactured housing and recreational vehicle industries, the
Corporation agrees to repurchase homes in the event of default by the retailer
at declining prices over the term of the agreement, generally 12 months. The
maximum repurchase liability is the total amount that would be paid upon the
default of all the Corporation's independent dealers. The maximum potential
repurchase liability, without reduction for the resale value of the repurchased
units, was approximately $104 million at February 28, 2003 and $120 million at
May 31, 2002. The risk of loss under these agreements is spread over many
retailers and financial institutions. The loss, if any, under these agreements
is the difference between the repurchase cost and the resale value of the
units. The allowance for doubtful accounts includes a reserve for potential
net losses on repurchased units. The amounts of obligations from repurchased
units and incurred net losses for the periods presented are as follows (dollars
in thousands):
Three-Months Ended Nine-Months Ended
February 28, February 28,
2003 2002 2003 2002
Obligations from units repurchased $ 316 $ 35 $ 630 $ 922
Net losses on repurchased units 1 6 51 179
Skyline Corporation and Subsidiary Companies
Notes to the Consolidated Financial Statements (continued)
For the nine-month period ended February 28, 2003
NOTE 1 Nature of Operations and Accounting Policies
In June 2002, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standard (SFAS) 146, "Accounting for Costs Associated with
Exit or Disposal Activities." This statement nullifies Emerging Issues Task
Force Issue No. 94-3, "Liability Recognition for Certain Employee Termination
and Other Costs to Exit an Activity." SFAS 146 addresses significant issues
relating to the recognition, measurement, and reporting of costs associated
with exit and disposal activities, including restructuring activities. SFAS
146 requires that a liability for a cost associated with an exit or disposal
activity be recognized when the liability is incurred. This statement is
effective for exit or disposal activities initiated after December 31, 2002.
The Corporation does not expect the adoption of SFAS 146 to have a material
impact on the consolidated financial statements.
The Corporation is a party to various pending legal proceedings in the normal
course of business. Management believes that any losses resulting from such
proceedings would not have a material adverse effect on the Corporation's
results of operations or financial position.
Skyline Corporation and Subsidiary Companies
Notes to the Consolidated Financial Statements
For the nine-month period ended February 28, 2003
NOTE 2 Industry Segment Information
(Unaudited)
Dollars in thousands
Three-Months Ended Nine-Months Ended
February 28, February 28,
2003 2002 2003 2002
SALES
Manufactured Housing $ 62,355 $ 74,317 $222,061 $261,424
Recreational Vehicles 25,354 21,763 94,607 74,935
Total sales $ 87,709 $ 96,080 $316,668 $336,359
(LOSS) EARNINGS BEFORE INCOME TAXES
OPERATING (LOSS) EARNINGS
Manufactured housing $ (146) $ 2,359 $ 6,778 $ 14,428
Recreational vehicles (1,269) (833) (1,028) (951)
General corporate
expense (397) (896) (2,427) (3,472)
Total operating
(loss) earnings (1,812) 630 3,323 10,005
Interest income 465 831 1,605 3,501
(Loss) earnings before
income taxes $ (1,347) $ 1,461 $ 4,928 $ 13,506
Operating earnings represent earnings before interest income, gain (loss) on
sale of property, plant and equipment and provision for income taxes with
non-traceable operating expenses being allocated to industry segments based on
percentages of sales.
Report of Independent Accountants
To The Board of Directors and Shareholders of Skyline Corporation:
We have reviewed the accompanying consolidated balance sheet of Skyline
Corporation and its subsidiaries as of February 28, 2003, and the related
consolidated statements of earnings and retained earnings for each of the
three-month and nine-month periods ended February 28, 2003 and 2002 and the
consolidated statements of cash flows for the nine-month period ended
February 28, 2003 and 2002. 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 the accompanying consolidated interim financial information for it
to be in conformity with accounting principles generally accepted in the United
States of America.
We previously audited in accordance with auditing standards generally accepted
in the United States of America, the consolidated balance sheet as of
May 31, 2002, and the related consolidated statements of earnings and retained
earnings, and of cash flows for the year then ended (not presented herein), and
in our report dated June 17, 2002 we expressed an unqualified opinion on those
consolidated financial statements. In our opinion, the information set forth
in the accompanying condensed consolidated balance sheet information as of
February 28, 2003, is fairly stated in all material respects in relation to
the consolidated balance sheet from which it has been derived.
PricewaterhouseCoopers LLP
Chicago, Illinois
March 20, 2003
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Skyline Corporation and Subsidiary Companies
Management's Discussion and Analysis of Financial Condition and Results
of Operations
Results of Operations for the Current Quarter Compared to the Same Quarter
Last Year
Sales in the quarter ended February 28, 2003 were $ 87,709,000, a decrease of
$8,371,000 from $96,080,000 in the comparable quarter of the prior year.
Fiscal 2003 sales through February 28 were $316,668,000, a decrease of
$19,691,000 from prior year's sales of $336,359,000. Manufactured housing
sales for the third quarter totaled $62,355,000 compared to $74,317,000 at
February 28, 2002. Manufactured housing unit sales decreased from 2,178 to
1,684. This segment's fiscal year sales were $222,061,000 versus $261,424,000,
while unit sales declined from 7,637 to 6,078. Third quarter recreational
vehicle sales increased from $21,763,000 in fiscal 2002 to $25,354,000 in
fiscal 2003. Recreational vehicle unit sales for the quarter increased from
1,525 to 1,730. Fiscal year sales through February 28 were $94,607,000 versus
$74,935,000. Unit sales increased from 5,406 to 6,579. Manufacturing housing
sales continue to be affected by difficult market conditions, restrictive
retail financing, and the U. S. economy. The increase in recreational vehicle
sales is a reflection of an industry-wide improvement in market conditions for
towable recreational vehicles. This trend began in early calendar year 2002.
Cost of sales in the third quarter of fiscal 2003 was 89.9 percent of sales
compared to 87.5 percent in fiscal 2002. Cost of sales for the first nine
months of fiscal 2003 was 87.7 percent versus 86.1 percent in the prior year.
The increase is primarily attributable to a product mix shift toward
recreational vehicles. This business segment represented 30 percent of total
sales in fiscal 2003 versus 22 percent in fiscal 2002. Manufactured housing
gross margins exceed those for recreational vehicles.
Quarterly selling and administrative expenses as a percentage of sales
increased from 11.8 percent in fiscal 2002 to 12.2 percent in fiscal 2003,
although the level of expenditures decreased $653,000 from the prior year.
Selling and administrative expenses as a percentage of sales for fiscal 2003
totaled 11.2 percent versus fiscal 2002's 10.9 percent, while expenditures
decreased $1,343,000.
As a percentage of sales, third quarter operating loss for manufactured housing
was 0.2 percent in fiscal 2003 versus operating earnings of 3.2 percent in the
prior year. Year to date operating earnings for manufactured housing were 3.1
percent in fiscal 2003 versus prior year's 5.5 percent. Earnings for
manufactured housing declined due to the continuation of difficult market
conditions noted above. Recreational vehicle quarterly losses were 5.0 percent
for fiscal year 2003 and 3.8 percent in fiscal year 2002. The quarterly loss
for recreational vehicles increased because of pricing pressures on gross
margins. Recreational vehicle operating losses for the nine months ended
February 28 were 1.1 percent for fiscal years 2003 and 1.3 percent for fiscal
year 2002.
Skyline Corporation and Subsidiary Companies
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Results of Operations for the Current Quarter Compared to the Same Quarter Last
Year (continued)
Interest income amounted to $465,000 for the third quarter compared to prior
year's $831,000. Interest income is directly related to the amount available
for investment and the prevailing yields of U.S. Government securities.
Liquidity and Capital Resources
At February 28, 2003, cash and short-term investments in U. S. Treasury Bills
totaled $152,504,000, an increase of $5,478,000 from $147,026,000 at May 31,
2002. Current assets exclusive of cash and investments in U.S. Treasury Bills
totaled $41,386,000 at February 28, 2003, a decrease of $4,411,000 from the
May 31, 2002 balance of $45,797,000. The decrease was due to a seasonal
decline in accounts receivable ($4,791,000).
Current liabilities increased $1,189,000 from $36,463,000 at May 31, 2002 to
$37,652,000 at February 28, 2003. Various factors contributed to the increase.
Accrued marketing programs increased $4,692,000 due to the timing of payments
for an ongoing marketing program. Trade accounts payable decreased $1,123,000
due to the seasonality of the Corporation's business. Accrued salaries and
wages decreased $1,653,000 due to the timing of paying employees at
February 28, 2003 versus May 31, 2002. Income taxes decreased $1,156,000 due
to the timing of federal income tax payments during the year.
Working capital at February 28, 2003 amounted to $156,238,000 compared to
$156,360,000 at May 31, 2002. Capital expenditures totaled $ 1,293,000 during
the first nine months of fiscal 2003 compared to $2,890,000 in the previous
year. Capital expenditures during this period were made primarily to replace
or refurbish machinery and equipment and improve manufacturing efficiencies.
The cash provided by operating activities, along with current cash and other
short-term investments, is expected to be adequate to fund any capital
expenditures and treasury stock purchases during the year. Historically, the
Corporation's financing needs have been met through funds generated internally.
Skyline Corporation and Subsidiary Companies
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Results of Operations for the Current Quarter Compared to the Same Quarter
Last Year (continued)
Other Matters
The provision for federal income taxes in each year approximates the statutory
rate and for state income taxes reflects current state rates effective for the
period based upon activities within the taxable entities.
The consolidated financial statements included in this report reflect
transactions in the dollar values in which they were incurred and, therefore,
do not attempt to measure the impact of inflation. However, the Corporation
believes that inflation has not had a material effect on its operations during
the past three years. On a long-term basis, the Corporation has demonstrated
an ability to adjust the selling prices of its products in reaction to changing
costs due to inflation.
Forward Looking Information
Certain statements in this report are considered forward looking as indicated
by the Private Securities Litigation Reform Act of 1995. These statements
involve uncertainties that may cause actual results to materially differ from
expectations as of the report date. These uncertainties include but are not
limited to:
* Cyclical nature of the manufactured housing and recreational vehicle
industries
* Availability of wholesale and retail financing
* Interest rate levels
* Impact of inflation
* Competitive pressures on pricing and promotional costs
* Consumer confidence
* Market demographics
* Management's ability to attract and retain executive officers and key
personnel
* Market disruption resulting from the terrorist attacks on September 11, 2001,
increased global tensions and armed conflict in Iraq.
Skyline Corporation and Subsidiary Companies
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Item 4. Controls and Procedures
(a) Evaluation of disclosure controls and procedures: The Company's Chief
Executive Officer and its Chief Financial Officer, after evaluating the
effectiveness of the Company's disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14(c) and 15-d-14(c)) as of a date within 90 days of
filing date of the quarterly report (the "Evaluation Date"), have concluded
that as of the Evaluation Date, the Company's disclosure controls and
procedures were adequate and effective to ensure that material information
relating to the Company would be made known to them by others within the
Company, particularly during the period in which this quarterly report was
being prepared.
(b) Changes in internal controls: There were no significant changes in the
Company's internal controls or in other factors that could significantly affect
the Company's internal controls and procedures subsequent to the Evaluation
Date, nor any significant deficiencies or material weaknesses in such internal
controls and procedures requiring corrective actions.
PART II
Item 1. Legal Proceedings
Information with respect to this Item for the period covered by this Form 10-Q
has been previously reported in Item 3, entitled "Legal Proceedings" of the
Form 10-K for the fiscal year ended May 31, 2002 heretofore filed by the
registrant with the Commission.
Item 6. Exhibits and Reports on Form 8-K
Exhibit 99.1 Certification of Chief Executive Officer pursuant to 18 U.S.C.
section 1350.
Exhibit 99.2 Certification of Chief Financial Officer pursuant to 18 U.S.C.
section 1350.
No reports on Form 8-K were filed during the third quarter of fiscal 2003.
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.
SKYLINE CORPORATION
DATE: April 14, 2003
James R. Weigand
V. P. Finance & Treasurer,
Chief Financial Officer
DATE: April 14, 2003
Jon S. Pilarski
Corporate Controller
CERTIFICATIONS
I, Thomas G. Deranek, Chief Executive Officer of Skyline Corporation, certify
that:
1. I have reviewed this quarterly report on Form 10-Q of Skyline
Corporation;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this quarterly report;
4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
and we have:
a) designed such disclosure controls and procedures to ensure
that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us
by others within those entities, particularly during the
period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to
the filing date of this quarterly report (the "Evaluation
Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based
on our evaluation as of the Evaluation Date;
5. The registrant's other certifying officer and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the
audit committee of registrant's board of directors (or persons
performing the equivalent function):
a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's
ability to record, process, summarize and report financial data
and have identified for the registrant's auditors any material
weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and
6. The registrant's other certifying officer and I have indicated in this
quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant
deficiencies and material weaknesses.
Date: April 14, 2003
/s/ Thomas G. Deranek
Thomas G. Deranek
Chief Executive Officer
I, James R. Weigand, Chief Financial Officer of Skyline Corporation, certify
that:
1. I have reviewed this quarterly report on Form 10-Q of Skyline
Corporation;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this quarterly report;
4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
and we have:
a) designed such disclosure controls and procedures to ensure
that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us
by others within those entities, particularly during the
period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to
the filing date of this quarterly report (the "Evaluation
Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based
on our evaluation as of the Evaluation Date;
5. The registrant's other certifying officer and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the
audit committee of registrant's board of directors (or persons
performing the equivalent function):
a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's
ability to record, process, summarize and report financial data
and have identified for the registrant's auditors any material
weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and
6. The registrant's other certifying officer and I have indicated in this
quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant
deficiencies and material weaknesses.
Date: April 14, 2003
/s/ James R. Weigand
James R. Weigand
Chief Financial Officer
EXHIBIT 99.1
CERTIFICATION OF PERIODIC FINANCIAL REPORTS
PURSUANT TO 18 U.S.C. SECTION 1350
The undersigned hereby certifies that he is the duly appointed and acting Chief
Executive Officer of Skyline Corporation, and hereby further certifies as
follows:
1. The periodic report containing financial statements to which this
certificate is an exhibit fully complies with the requirements of Section 13(a)
or 15 (d) of the Securities Exchange Act of 1934.
2. The information contained in the periodic report to which this certificate
is an exhibit fairly presents, in all material respects, the financial
condition and results of operations of the Company.
In witness whereof, the undersigned has executed and delivered this certificate
as of the date set forth opposite his signature below.
Date: April 14, 2003 /s/ Thomas G. Deranek
Thomas G. Deranek
Vice Chairman, Chief Executive
Officer and Director
EXHIBIT 99.2
CERTIFICATION OF PERIODIC FINANCIAL REPORTS
PURSUANT TO 18 U.S.C. SECTION 1350
The undersigned hereby certifies that he is the duly appointed and acting
Chief Financial Officer of Skyline Corporation, and hereby further certifies
as follows:
1. The periodic report containing financial statements to which this
certificate is an exhibit fully complies with the requirements of Section 13(a)
or 15 (d) of the Securities Exchange Act of 1934.
2. The information contained in the periodic report to which this certificate
is an exhibit fairly presents, in all material respects, the financial
condition and results of operations of the Company.
In witness whereof, the undersigned has executed and delivered this certificate
as of the date set forth opposite his signature below.
Date: April 14, 2003 /s/ James R. Weigand
James R. Weigand
Vice President-Finance and
Treasurer and Chief Financial Officer