UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 11-K
(Mark One)
[X] Annual Report Pursuant to Section 15 (d) of the Securities Exchange Act of
1934
For the fiscal year ended December 31, 2002
or
[ ] Transition Report Pursuant to Section 15 (d) of the Securities Exchange Act
of 1934
For the transition period from ____________ to ____________
COMMISSION FILE NUMBER: 0-8454
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
JLG INDUSTRIES, INC. EMPLOYEES' RETIREMENT SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
JLG INDUSTRIES, INC.
1 JLG DRIVE
MCCONNELLSBURG, PA 17233-9533
REQUIRED INFORMATION
The financial statements and related report, prepared in accordance with the
financial reporting requirements of the Employee Retirement Income Security Act
of 1974 (ERISA), listed below are furnished for the JLG Industries, Inc.
Employees' Retirement Savings Plan (the "Plan"). The pages referred to are the
numbered pages in the Plan's audited financial statements for the years ended
December 31, 2002 and 2001.
Pages
-----
Independent Auditor's Report 1
Audited Financial Statements and Supplemental Schedule 2-11
JLG INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
FINANCIAL REPORT
DECEMBER 31, 2002
C O N T E N T S
FINANCIAL REPORT
Audit Report 1
Statements of Net Assets Available for Plan Benefits 2
Statements of Changes in Net Assets Available for Plan Benefits 3
Notes to Financial Statements 4-10
Supplemental Schedule of Assets Held for Investment Purposes 11
INDEPENDENT AUDITOR'S REPORT
Administrative Committee and Trustees
JLG Industries, Inc. Employees'
Retirement Savings Plan
McConnellsburg, Pennsylvania
We have audited the accompanying statements of net assets available
for Plan benefits of the JLG Industries, Inc. Employees' Retirement Savings Plan
(Plan) as of December 31, 2002 and 2001, and the related statements of changes
in net assets available for Plan benefits for the years then ended. 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 auditing standards
generally accepted in the United States of America. 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, 2002 and 2001, and the changes in its net assets
available for benefits for the years then ended, in conformity with accounting
principles generally accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental schedule of Assets
Held for Investment Purposes is presented for the purpose of additional analysis
and is not a required part of the basic financial statements, but is
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. This supplemental schedule is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in the audit of the basic financial statements for the year
ended December 31, 2002 and, in our opinion, is fairly stated in all material
respects in relation to the basic financial statements taken as a whole.
/s/ SMITH ELLIOTT KEARNS & COMPANY, LLC
Chambersburg, Pennsylvania
June 5, 2003
JLG INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31,
2002 2001
----------- -----------
ASSETS
Cash $ 460,505 $ 349,419
Investments 77,484,844 94,694,461
Participant loans 2,860,723 1,856,860
----------- -----------
80,806,072 96,900,740
----------- -----------
RECEIVABLES:
Employee contributions 78,608 --
Employer contributions 38,803 --
Accrued income 9,337 9,941
----------- -----------
126,748 9,941
----------- -----------
TOTAL ASSETS/NET ASSETS AVAILABLE FOR
PLAN BENEFITS $80,932,820 $96,910,681
=========== ===========
The Notes to Financial Statements are an integral part of these financial
statements.
-2-
JLG INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
STATEMENTS OF CHANGES IN NET ASSETS
AVAILABLE FOR PLAN BENEFITS
YEAR ENDED DECEMBER 31,
2002 2001
------------ -------------
ADDITIONS:
Employer contributions $ 1,331,535 $ 1,463,226
Employee contributions 3,615,768 3,917,381
Employee rollovers 749,037 154,840
------------ -------------
5,696,340 5,535,447
Investment income 217,574 1,633,509
------------ -------------
5,913,914 7,168,956
------------ -------------
DEDUCTIONS:
Benefit payments 6,833,215 10,306,260
Administrative expenses 15,723 64,252
------------ -------------
6,848,938 10,370,512
------------ -------------
Net realized and unrealized losses on investments (15,042,837) (6,306,731)
------------ -------------
NET DECREASE IN NET ASSETS AVAILABLE FOR PLAN BENEFITS (15,977,861) (9,508,287)
NET ASSETS AVAILABLE FOR PLAN BENEFITS
AT BEGINNING OF YEAR 96,910,681 106,418,968
------------ -------------
NET ASSETS AVAILABLE FOR PLAN BENEFITS
AT END OF YEAR 80,932,820 $ 96,910,681
============ =============
The Notes to Financial Statements are an integral part of these financial
statements.
-3-
NOTES TO FINANCIAL STATEMENTS
NOTE A - DESCRIPTION OF THE PLAN
The JLG Industries, Inc. Employees' Retirement Savings Plan ("Plan") is a
defined contribution plan which covers substantially all domestic employees
of JLG Industries, Inc., JLG Equipment Services, Inc., Access Financial
Solutions, Inc. and JLG Manufacturing, LLC (collectively the "Company").
The Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA").
The Plan consists of two parts: a 401(k) savings feature and Company profit
sharing contributions. The 401(k) savings feature provides for both
participants' pre-tax contributions and the Company's matching
contributions. Participants may elect to make pre-tax contributions up to
20% of their eligible compensation. Participants may also contribute
amounts representing distributions from other tax qualified plans. The
Company matches participants' contributions at a rate of $.50 for every
$1.00 contributed up to a maximum of 5% of the participants' eligible
compensation. Profit sharing contributions are based upon the profitability
of the Company and the amounts are as determined at the discretion of the
Board of Directors of JLG Industries, Inc.
Participants become vested in their account balances as follows: immediate
and full vesting of their 401(k) contributions and graduated vesting in
their profit sharing and Company matching contributions. Participants
become fully vested in their Company matching 401(k) contributions, profit
sharing accounts, and company stock accounts after four years of service,
with 25% vesting after two years, 50% vesting after three years, and 100%
vesting after four years of service. Upon termination of employment, the
participants receive the vested portion of their accounts in accordance
with Plan provisions.
If hired after October 2001, employees become participants in the Plan on
the first day of the month following 30 days of employment. Participants'
accounts are credited with their 401(k) contributions and the Company's
profit-sharing and 401(k) matching contributions. Participants also receive
allocations of Plan earnings or losses. Allocations of Plan earnings are
based upon participants' average account balances.
As of October 1, 2001, participant-directed contributions were directed
from existing mutual funds into the 13 investment options described below.
Participants may change their investment elections daily in 5% increments.
The accounts of participants who do not make such an election are
automatically invested in the Stable Value Fund.
SHORT TERM/STABLE VALUE FUND (MM MONEY MARKET): This fund seeks current
income consistent with liquidity and the preservation of principal. It
invests primarily in short-term debt instruments with a remaining maturity
not exceeding 397 days. The most common types are U.S. Treasury bills
(T-bills) issued by the U.S. government, commercial paper issued by
corporations, and certificates of deposit (CDs) issued by banks and other
savings institutions. David L. Babson and Company Inc. is the investment
manager of the fund.
-4-
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE A - DESCRIPTION OF THE PLAN (CONTINUED)
FIXED INCOME FUND (PIMCO TOTAL RETURN): This fund seeks maximum total
return, consisting of current income and price appreciation, consistent
with preservation of capital and prudent investment management. The fund
invests primarily in investment-grade debt securities, including U.S.
Government bonds, corporate bonds, mortgage-backed bonds, and money market
instruments. The fund may also invest a portion of its assets in high-yield
securities and non-U.S. securities. The average duration, or interest rate
sensitivity, of the fund is between three and six years normally within one
and a half years of the bond market as a whole. Pacific Investment
Management Company LLC is the investment manager of the fund.
BALANCED FUND (OPPENHEIMER QUEST BALANCED VALUE): This fund invests in
equity and fixed-income securities in pursuit of capital growth and current
income. Typically, a large portion of the fund will be invested in the
stock of 15 - 30 large, well-established, undervalued companies. Under
normal conditions, the portion of the fund invested in equity securities
might range from 50% - 75%. OppenheimerFunds, Inc. is the investment
manager of the fund, and OpCap Advisors is an adviser to the
OppenheimerFunds.
LARGE CAP VALUE FUND (MM LARGE CAP VALUE): This fund invests in common
stocks of growing companies with market capitalizations greater than $5
billion. The manager seeks to invest in stocks that are selling at
discounted valuations and to hold them for the long term. Davis Selected
Advisers, L.P. is the investment manager of the fund.
LARGE CAP CORE INDEX FUND (VANGUARD INSTITUTIONAL INDEX): This fund holds
all of the 500 stocks that make up the unmanaged Standard & Poor's 500
Composite Stock Price Index, a widely recognized benchmark of U.S. stock
market performance, in proportion to their weighting in the index. The fund
attempts to match the performance of the index and remains fully invested
in stocks at all times. Though the fund seeks to match the index, its
performance typically can be expected to fall short by a small percentage
representing operating costs. The Vanguard Group, Inc. is the investment
manager of the fund.
LARGE CAP GROWTH FUND (MM GROWTH EQUITY): This fund invests in stocks of
companies that offer long-term growth. Fundamental analysis identifies
well-run, growing companies that have strong management, a successful track
record, long-term earnings growth, and potential for market leadership. MFS
Investment Management is the investment manager of the fund.
MID CAP VALUE FUND (MM FOCUSED VALUE): This fund invests in equity
securities of medium-sized U.S. companies that are trading at significant
discounts. The fund normally holds fewer stocks than a diversified fund,
and will concentrate among 18 - 22 stocks. The fund may invest up to 25% of
its total assets in securities of non-U.S. issuers. Harris Associates, L.P.
is the investment manager of the fund.
-5-
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE A - DESCRIPTION OF THE PLAN (CONTINUED)
MID CAP GROWTH FUND (MM MID CAP GROWTH II): This fund invests in stocks of
companies with medium-sized market capitalizations that have proven
products or services and above-average earnings. The fund's emphasis is on
companies with strong balance sheets and the cash flow to fund growth. T.
Rowe Price Associates is the investment manager of the fund.
SMALL CAP VALUE EQUITY FUND (DLB SMALL CO. OPPORTUNITIES): This fund
invests in equity securities of micro cap companies with market
capitalizations, when purchased, or under $250 million. The manager selects
companies with above-average returns on assets and equity, low debt, and
well-regarded management. David L. Babson and Company Inc. is the
investment manager of the fund.
SMALL CAP GROWTH EQUITY FUND (MM SMALL CAP GROWTH): This fund invests in
stocks of smaller companies believed to offer potential for long-term
growth. The fund is co-managed by J.P. Morgan Investment Management, Inc.
and Waddell & Reed Investment Management Company.
INTERNATIONAL/GLOBAL FUND (MM INTERNATIONAL EQUITY FUND): This fund invests
in common stocks of varied-sized companies located in Europe, the Far East,
and emerging markets. Oppenheimer is manager of the fund. Stock selection
is guided by economic, political, and social influences in the
international community that dictate long-term growth trends.
COMPANY STOCK FUND: This fund invests in JLG common stock. Additional
information about this fund appears in the body of the Combined Summary
Plan Description and Prospectus. Mass Mutual manages this fund.
SELF-DIRECTED BROKERAGE ACCOUNT: This investment option permits a
participant to select his own investments. State Street Brokerage provides
brokerage services to this account. The account does not have an investment
manager. Instead, the participant is responsible for selecting and
monitoring his or her own investments. Additional information about this
fund appears in the body of the Combined Summary Plan Description and
Prospectus.
Participants may borrow from their accounts a minimum of $1,000 up to the
lesser of $50,000, 50% of their vested account balance, or 100% of their
pre-tax, after-tax, and rollover account balances. Loan terms generally do
not exceed five years. Loans are secured by the balance in the
participant's account and bear interest at a reasonable rate to be
determined at the time the loan begins based on prevailing market rates.
Principal and interest is paid ratable through payroll deductions.
On termination of service, a participant may elect to receive either a
lump-sum amount equal to the value of the participant's vested interest in
his or her account or a life annuity.
Although it has not expressed any intent to do so, the Company has the
right to terminate the Plan subject to the provisions of ERISA. In the
event of such termination, the net assets of the Plan are to be distributed
in accordance with the provisions of the Plan, but in no event shall any
amounts be returned to the Company.
-6-
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE A - DESCRIPTION OF THE PLAN (CONTINUED)
The Plan is administered by the Administrative Committee of JLG Industries,
Inc. (the Corporation). The Corporation may pay all or part of the
out-of-pocket administrative expenses of the Plan. Any expenses not paid by
the Corporation shall be paid out of Plan assets.
The foregoing description of the Plan provides only general information.
Participants should refer to the Summary Plan Description or Plan agreement
for a more complete description of the Plan's provisions. Copies are
available from the Company's Human Resources Department.
NOTE B - SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The accounting records of the Plan are maintained on an accrual basis.
Interest and dividend income is recognized when earned, and benefits are
recognized when paid.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of net assets and disclosure
of contingent assets and liabilities at the date of the financial
statements and the reported amounts of contributions, earning, expenses and
benefit payments during the reporting period. Actual results could differ
from those estimates.
INVESTMENT VALUATION
Investments are stated at aggregate market value. Securities which are
traded on a national securities exchange are valued at the last reported
sales price on the last business day of the year. The Plan's investments in
mutual funds are valued at the aggregate of the quoted market prices of the
underlying securities.
Purchases and sales of securities are reflected on a trade-date basis. The
unrealized difference in market value from one year to the next and
realized gains and losses are recognized as net appreciation (depreciation)
in fair value of investments in the accompanying statements of changes in
net assets available for benefits.
FORFEITED ACCOUNTS
For the years ended December 31, 2002 and 2001, no forfeitures of Company
contributions were used to offset employer contributions. At December 31,
2002 and 2001, $636,642 and $339,717, respectively, are available to reduce
future employer contributions.
RECLASSIFICATION IN FINANCIAL STATEMENTS
The 2001 financial statements include certain reclassifications to conform
to the current year reporting practices.
-7-
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE C - INVESTMENTS
Investments that represent five percent or more of the Plan's net assets
available for plan benefits at the beginning of the year are as follows at
December 31:
2002 2001
---- ----
Vanguard Institutional Index $12,924,301 $20,277,924
Oppenheimer Quest Balanced 9,191,294 15,684,045
Mass Mutual Mid Cap Growth II 6,580,994 10,488,762
Mass Mutual Money Market 23,445,524 23,890,142
*JLG Industries, Inc. Common Stock 13,758,722 20,190,702
PIMCO Total Return 6,270,173 **
* Represents a party in interest
** Amount does not exceed 5% of plan assets at the beginning of the year.
During the years ended December 31, 2002 and 2001, the Plan's investments
(including gains and losses on investments bought and sold, as well as held
during the year) appreciated (depreciated) in value by ($15,042,837) and
($6,306,731), respectively.
YEAR ENDED DECEMBER 31
2002 2001
---- ----
Mutual funds $ (9,493,028) $(6,397,968)
Common stock (5,549,809) 91,237
------------ -----------
$(15,042,837) $(6,306,731)
============ ===========
NOTE D - NONPARTICIPANT-DIRECTED INVESTMENTS
Information about the net assets and the significant components of the
changes in net assets relating to the nonparticipant-directed investments
is as follows:
DECEMBER 31, 2001
-----------------
Net Assets:
JLG Industries, Inc. Common Stock $ 20,190,702
YEAR ENDED
DECEMBER 31, 2001
-----------------
Changes in Net Assets
Dividends $ 74,782
Net appreciation 137,885
Benefits paid to participants (2,134,664)
Transfers and other changes (685,342)
-----------
$(2,607,339)
===========
In 2002, participants could defer into the JLG Industries, Inc. Company
Stock Fund, making this a participant-directed investment.
-8-
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE E - OBLIGATIONS DUE TERMINATED/RETIRED PARTICIPANTS
The amounts due terminated and retired participants with vested interests
as of December 31, 2002 and 2001 were $803,590 and $1,980,203,
respectively.
NOTE F - TAX STATUS
The Internal Revenue Service has determined and informed the Corporation by
a letter dated July 18, 2002, that the Plan and related trust are designed
in accordance with applicable sections of the Internal Revenue Code (IRC).
The Plan has been amended since receiving the determination letter.
However, the Plan administrator and the Plan's tax counsel believe that the
Plan is designed and is currently being operated in compliance with the
applicable requirements of the IRC. Therefore, no provision for income
taxes has been included in the Plan's financial statements.
NOTE G - RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for Plan benefits
per the financial statements to Form 5500:
2002 2001
---- ----
Net assets available for Plan
benefits per the financial
statements $ 80,932,820 $ 96,910,681
Contributions receivable:
Employee (78,608) --
Employer (38,803) --
------------ ------------
Net assets available for Plan
benefits per the Form 5500 $ 80,815,409 $ 96,910,681
============ ============
The following is a reconciliation of contributions per the financial
statements to Form 5500:
2002 2001
---- ----
Contributions per the financial
statements:
Employee $ 3,615,768 $ 3,917,381
Employer 1,331,535 1,463,226
Employee rollovers 749,037 154,840
----------- -----------
5,696,340 5,535,447
Contributions receivable:
Employee - 2002 (78,608) --
Employer - 2002 (38,803) --
------------ -----------
Total contributions per the
Form 5500 $ 5,578,929 $ 5,535,447
=========== ===========
-9-
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE G - RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500 (CONTINUED)
The following is a reconciliation of investments listed on the financial
statements to categories of investments used on the form 5500 as of
December 31:
2002 2001
---- ----
FINANCIAL STATEMENT PRESENTATION
Investments $ 77,484,844 $ 94,694,461
============ ============
FORM 5500
Value of interest in pooled
separate accounts $ 44,483,340 $ 53,851,296
Value of interest in registered
investment companies
(e.g., mutual funds) 19,149,462 20,593,829
Employer securities 13,758,722 20,190,702
Other 93,320 58,634
------------ ------------
Total Investments $ 77,484,844 $ 94,694,461
============ ============
The following is a reconciliation of investment income and net realized and
unrealized losses listed on the financial statements to categories of
income used on the Form 5500.
YEAR ENDED DECEMBER 31
2002 2001
---- ----
FINANCIAL STATEMENT PRESENTATION
Investment income $ 217,574 $ 1,633,509
Net realized and unrealized
losses on investments (15,042,837) (6,306,731)
------------ ------------
Total $(14,825,263) $ (4,673,222)
============ ============
FORM 5500 PRESENTATION
Interest income $ 180,409 $ 445,069
Dividend income 36,767 74,782
Net gain on sale of assets 221,688 159,967
Unrealized depreciation of assets (5,796,709) (68,730)
Net (loss) gain from pooled
separate accounts (5,673,555) 2,638,324
Net loss from registered
investment company (3,819,473) (8,046,749)
Other income 25,610 124,115
------------ ------------
Total $(14,825,263) $ (4,673,222)
============ ============
-10-
JLG INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
SUPPLEMENTAL SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 2002
(c.)
(b.) DESCRIPTION (e.)
(a.) IDENTITY OF ISSUE, BORROWER OF INVESTMENT CURRENT VALUE
--------------------------- ------------- -------------
Cash Cash $ 460,505
Mass Mutual Money Market Mutual Fund 23,445,524
PIMCO Total Return Mutual Fund 6,225,161
Oppenheimer Quest Balanced Value Mutual Fund 9,191,294
Mass Mutual Large Cap Value Mutual Fund 749,051
Vanguard Institutional Index Mutual Fund 12,924,301
Mass Mutual Growth Equity Mutual Fund 271,938
Mass Mutual Focused Value Mutual Fund 2,204,174
Mass Mutual Mid Cap Growth II Mutual Fund 6,580,994
DLB Small Co. Opportunities Mutual Fund 1,680,847
Mass Mutual Small Cap Growth Mutual Fund 225,414
Mass Mutual International Equity Fund Mutual Fund 134,104
* JLG Industries Common Stock Common Stock 13,758,722
SSGA Money Market Fund Mutual Fund 28,022
AES Corp Common Stock 3,020
Bradley Pharmacetls Inc CL A Common Stock 4,821
Callon Pete Co Del Common Stock 4,221
Emerson Radio Corp Common Stock 15,531
Merge Technologies Inc. Common Stock 6,880
OSI Systems Inc. Common Stock 3,396
Oracle Corporation Common Stock 21,600
Royale Energy Inc. Common Stock 5,829
Participant Loans 5.25% - 12% 2,860,723
-----------
$80,806,072
===========
* Represents a party in interest
-11-
EXHIBITS
23 Consent of Independent Auditors
SIGNATURE
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934,
the Plan administrator has duly caused this annual report to be signed on its
behalf by the undersigned hereunto duly authorized.
JLG Industries, Inc. Employees'
Retirement Savings Plan
(Name of Plan)
Date: June 30, 2003 /s/ Thomas D. Singer
------------------------------------------
Thomas D. Singer
Senior Vice President, General Counsel and
Secretary
JLG INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
23 Consent of Independent Auditors