SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
__________
FORM 10-Q
QUARTERLY REPORT
__________
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
__________
For the quarter ended May 29, 2004
__________
REGISTRANT: CLARCOR Inc. (Delaware)
__________
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 SECURTIES
EXCHANGE ACT OF 1934
For the quarterly period ended May 29, 2004
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 1-11024
CLARCOR Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 36-0922490
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2323 Sixth Street, P.O. Box 7007, Rockford, Illinois 61125
- ---------------------------------------------------- --------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 815-962-8867
No Change
- --------------------------------------------------------------------------------
(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 (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 [ ]
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2) Yes [X] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the close of the period covered by this report.
25,424,542 common shares outstanding
------------------------------------
Page 1
Part I - Item 1
CLARCOR Inc.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Dollars in thousands)
May 29, November 30,
2004 2003
--------- -----------
(unaudited)
ASSETS
Current assets:
Cash and short-term cash investments $ 23,516 $ 8,348
Accounts receivable, less allowance for losses
of $9,217 for 2004 and $9,106 for 2003 127,815 127,546
Inventories:
Raw materials 37,365 34,174
Work in process 13,598 11,866
Finished products 57,539 53,633
--------- -----------
Total inventories 108,502 99,673
--------- -----------
Prepaid expenses and other current assets 4,150 5,880
Deferred income taxes 16,297 15,955
--------- -----------
Total current assets 280,280 257,402
--------- -----------
Plant assets at cost, 312,801 304,892
less accumulated depreciation (183,662) (175,320)
--------- -----------
129,139 129,572
--------- -----------
Goodwill 85,389 82,720
Trademarks 29,476 29,476
Other acquired intangibles, less accumulated amortization 9,887 10,155
Pension assets 20,732 20,153
Other noncurrent assets 7,827 8,759
--------- -----------
$ 562,730 $ 538,237
========= ===========
LIABILITIES
Current liabilities:
Current portion of long-term debt $ 518 $ 674
Accounts payable 50,939 49,256
Income taxes 7,586 8,377
Accrued employee compensation 18,540 23,400
Other accrued liabilities 33,914 29,666
--------- -----------
Total current liabilities 111,497 111,373
--------- -----------
Long-term debt, less current portion 16,789 16,913
Long-term pension liabilities 9,313 7,813
Deferred income taxes 20,998 21,729
Other long-term liabilities 8,839 8,339
Minority interests 1,611 1,678
Contingencies
SHAREHOLDERS' EQUITY
Capital stock 25,425 25,309
Capital in excess of par value 21,919 19,998
Accumulated other comprehensive earnings 104 (936)
Retained earnings 346,235 326,021
--------- -----------
393,683 370,392
--------- -----------
$ 562,730 $ 538,237
========= ===========
See Notes to Consolidated Condensed Financial Statements
Page 2
CLARCOR Inc.
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(Dollars in thousands except per share data)
(Unaudited)
Quarter Ended Six Months Ended
-------------------------- --------------------------
May 29, May 31, May 29, May 31,
2004 2003 2004 2003
------------ ----------- ------------ -----------
Net sales $ 198,712 $ 185,775 $ 373,984 $ 357,269
Cost of sales 137,613 129,176 261,401 252,321
------------ ----------- ------------ -----------
Gross profit 61,099 56,599 112,583 104,948
Selling and administrative expenses 37,306 36,061 70,977 68,923
------------ ----------- ------------ -----------
Operating profit 23,793 20,538 41,606 36,025
------------ ----------- ------------ -----------
Other income (expense):
Interest expense (109) (450) (227) (974)
Interest income 86 20 137 130
Other, net (194) 469 458 515
------------ ----------- ------------ -----------
(217) 39 368 (329)
------------ ----------- ------------ -----------
Earnings before income taxes and
minority interests 23,576 20,577 41,974 35,696
Provision for income taxes 8,567 7,499 15,270 13,015
------------ ----------- ------------ -----------
Earnings before minority interests 15,009 13,078 26,704 22,681
Minority interests in earnings of subsidiaries (95) (31) (129) (38)
------------ ----------- ------------ -----------
Net earnings $ 14,914 $ 13,047 $ 26,575 $ 22,643
============ =========== ============ ===========
Net earnings per common share:
Basic $ 0.59 $ 0.52 $ 1.05 $ 0.91
============ =========== ============ ===========
Diluted $ 0.58 $ 0.51 $ 1.03 $ 0.89
============ =========== ============ ===========
Average number of common shares outstanding:
Basic 25,435,860 25,015,289 25,402,373 24,973,997
============ =========== ============ ===========
Diluted 25,872,920 25,435,452 25,841,322 25,326,543
============ =========== ============ ===========
Dividends paid per share $ 0.1250 $ 0.1225 $ 0.2500 $ 0.2450
============ =========== ============ ===========
See Notes to Consolidated Condensed Financial Statements
Page 3
CLARCOR Inc.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
Six Months Ended
---------------------------
May 29, May 31,
2004 2003
------------ ------------
Cash flows from operating activities:
Net earnings $ 26,575 $ 22,643
Depreciation 9,291 9,860
Amortization 380 453
Changes in assets and liabilities (2,064) (2,534)
Other, net (571) 45
------------ ------------
Net cash provided by operating activities 33,611 30,467
------------ ------------
Cash flows from investing activities:
Business acquisitions, net of cash acquired (4,871) -
Additions to plant assets (9,197) (6,041)
Other, net 1,415 26
------------ ------------
Net cash used in investing activities (12,653) (6,015)
------------ ------------
Cash flows from financing activities:
Proceeds from line of credit 1,500 94,111
Payments on line of credit (1,500) (116,083)
Payments on long-term debt (280) (465)
Cash dividends paid (6,361) (6,120)
Other, net 871 440
------------ ------------
Net cash used in financing activities (5,770) (28,117)
------------ ------------
Net effect of exchange rate changes on cash (20) 244
------------ ------------
Net change in cash and short-term cash investments 15,168 (3,421)
Cash and short-term cash investments,
beginning of period 8,348 13,747
------------ ------------
Cash and short-term cash investments,
end of period $ 23,516 $ 10,326
============ ============
Cash paid during the period for:
Interest $ 222 $ 999
============ ============
Income taxes $ 14,396 $ 9,066
============ ============
See Notes to Consolidated Condensed Financial Statements
Page 4
CLARCOR Inc.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
(Unaudited)
1. CONSOLIDATED FINANCIAL STATEMENTS
The November 30, 2003 consolidated balance sheet data was derived from
CLARCOR's year-end audited financial statements, but does not include all
disclosures required by accounting principles generally accepted in the
United States of America. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with
accounting principles generally accepted in the United States of America
have been condensed or omitted.
The consolidated condensed balance sheet as of May 29, 2004, the
consolidated condensed statements of earnings and the consolidated
condensed statements of cash flows for the periods ended May 29, 2004, and
May 31, 2003, have been prepared by the Company without audit. The
financial statements have been prepared on the same basis as those in the
Company's November 30, 2003 annual report on Form 10-K. In the opinion of
management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position, results
of operations, and cash flows have been made. The results of operations
for the period ended May 29, 2004 are not necessarily indicative of the
operating results for the full year. Certain reclassifications have been
made to conform prior years' data to the current presentation. These
reclassifications had no effect on reported earnings.
2. BUSINESS ACQUISITION
At the beginning of the second quarter ended May 29, 2004, the Company
acquired certain assets of Filtrel Group, a Luton, England manufacturer
and distributor of heavy-duty air filters for approximately $4,871 in
cash. As a result of the acquisition, the assets were combined into
existing subsidiaries of the Company in the Engine/Mobile Filtration
segment and the results will be included in the Company's consolidated
results of operations from the date of acquisition.
A preliminary allocation of the initial purchase price has been made to
major categories of assets and liabilities. The $2,519 excess of the
initial purchase price over the preliminary estimated fair value of the
net tangible and identifiable intangible assets acquired was recorded as
goodwill. Other acquired intangibles included a noncompete agreement
valued by an independent appraiser at $115, which will be amortized on a
straight-line basis over two years. The Company also recorded $50 as exit
costs for terminated employees. This amount was paid during the quarter
ended May 29, 2004. The acquisition is not material to the results of the
Company. The Company expects to make additional adjustments to reflect
purchase agreement adjustments and adjustments for valuation of assets.
3. STOCK-BASED COMPENSATION
The Company accounts for stock-based compensation using the intrinsic
value method. If the Company had determined compensation expense for its
stock-based compensation plans based on the fair value at the grant dates,
the Company's pro forma net earnings and basic and diluted earnings per
share (EPS) would have been as follows:
Page 5
CLARCOR Inc.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
(Unaudited) Continued
3. STOCK-BASED COMPENSATION (Continued)
Quarter Ended Six Months
------------------- -------------------
May 29, May 31, May 29, May 31,
2004 2003 2004 2003
-------- -------- -------- --------
Net earnings, as reported $ 14,914 $ 13,047 $ 26,575 $ 22,643
Less total stock-based
compensation expense under the
fair value-based method, net of
tax 739 1,100 1,330 1,501
-------- -------- -------- --------
Pro forma net earnings $ 14,175 $ 11,947 $ 25,245 $ 21,142
======== ======== ======== ========
Basic EPS, as reported $ 0.59 $ 0.52 $ 1.05 $ 0.91
Pro forma basic EPS $ 0.56 $ 0.52 $ 0.99 $ 0.85
Diluted EPS, as reported $ 0.58 $ 0.52 $ 1.03 $ 0.89
Pro forma diluted EPS $ 0.55 $ 0.47 $ 0.98 $ 0.83
The fair value of each option grant is estimated on the date of grant
using the Black-Scholes option pricing model with the following weighted
average assumptions for the quarter and six months ended May 29, 2004 and
May 31, 2003, respectively. Adjustments for forfeitures are made as they
occur.
Quarter Ended Six Months Ended
---------------- ----------------
May 29, May 31, May 29, May 31,
2004 2003 2004 2003
------ ------ ------ ------
Risk-free interest rate 4.50% 3.87% 4.50% 3.87%
Expected dividend yield 1.29% 1.58% 1.29% 1.58%
Expected volatility factor 27.10% 24.60% 27.10% 24.60%
Expected option term (in years) 7.0 7.0 7.0 7.0
4. EARNINGS PER SHARE
Diluted earnings per share reflects the impact of outstanding stock
options and restricted stock as if exercised during the periods presented
using the treasury stock method. The following table provides a
reconciliation of the numerators and denominators utilized in the
calculation of basic and diluted earnings per share:
Quarter Ended Six Months Ended
--------------------------- ---------------------------
May 29, May 31, May 29, May 31,
2004 2003 2004 2003
------------ ------------ ------------ ------------
Net Earnings $ 14,914 $ 13,047 $ 26,575 $ 22,643
Basic EPS:
Weighted average number of common
shares outstanding 25,435,860 25,015,289 25,402,373 24,973,997
Basic per share amount $ 0.59 $ 0.52 $ 1.05 $ 0.91
============ ============ ============ ============
Page 6
CLARCOR Inc.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
(Unaudited) Continued
4. EARNINGS PER SHARE (Continued)
Quarter Ended Six Months Ended
----------------------- -----------------------
May 29, May 31, May 29, May 31,
2004 2003 2004 2003
---------- ---------- ---------- ----------
Diluted EPS:
Weighted average number of common
shares outstanding 25,435,860 25,015,289 25,402,373 24,973,997
Dilutive effect of stock options and
restricted stock 437,060 420,163 438,949 352,546
---------- ---------- ---------- ----------
Diluted weighted average number of
common shares outstanding 25,872,920 25,435,452 25,841,322 25,326,543
Diluted per share amount $ 0.58 $ 0.51 $ 1.03 $ 0.89
========== ========== ========== ==========
The following options were not included in the computation of diluted
earnings per share as the options' exercise prices were greater than the
average market price of the common shares during the respective quarter
and year-to-date periods:
Quarter Ended Six Months Ended
----------------- ------------------
May 29, May 31, May 29, May 31,
2004 2003 2004 2003
-------- ------- -------- --------
Options 296,855 77,398 296,855 189,906
Weighted Average Exercise Price $ 45.58 $ 36.38 $ 45.58 $ 35.68
For the six months ended May 29, 2004, exercises of stock options added
$1,615 to capital in excess of par value.
5. COMPREHENSIVE EARNINGS
The Company's total comprehensive earnings and its components are as
follows:
Quarter Ended Six Months Ended
-------------------- -------------------
May 29, May 31, May 29, May 31,
2004 2003 2004 2003
-------- -------- -------- ---------
Net earnings $ 14,914 $ 13,047 $ 26,575 $ 22,643
Other comprehensive earnings, net of tax:
Foreign currency translation adjustments
(1,065) 1,754 1,040 3,209
-------- -------- -------- ---------
Total comprehensive earnings $ 13,849 $ 14,801 $ 27,615 $ 25,852
======== ======== ======== ========
Page 7
CLARCOR Inc.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
(Unaudited) Continued
6. RELOCATION COSTS
On January 8, 2004, the Company announced that the corporate headquarters
will move to Nashville, TN in 2004. Costs for this move, which will
largely be a one-time expense incurred primarily during the third quarter
of fiscal 2004, are still being finalized. Approximately $79 was accrued
during the second quarter ended May 29, 2004 for employee termination
benefits, resulting in a total accrual of $87 of which $6 was paid as of
May 29, 2004. These termination benefits, currently estimated at $233, are
dependent upon the employees rendering service through a retention period
and will be recognized ratably over the required service period.
Approximately $313 of other costs associated with the relocation were paid
and expensed during the quarter ended May 29, 2004. Relocation costs in
total are not expected to exceed $0.07 per share. The Company expects to
pay all significant relocation costs during fiscal year 2004.
7. GUARANTEES AND WARRANTIES
The Company has provided letters of credit totaling approximately $23,297
to various government agencies, primarily related to industrial revenue
bonds and to insurance companies and other entities in support of its
obligations. The Company believes that no payments will be required
resulting from these accommodation obligations.
In the ordinary course of business, the Company also provides routine
indemnifications and other guarantees whose terms range in duration and
often are not explicitly defined. The Company does not believe these will
have a material impact on the results of operations or financial condition
of the Company.
The Company has a majority ownership interest in a consolidated affiliate
in which the Company has agreed, under certain conditions, to buy out the
minority owners' interest for an amount estimated not to exceed $810.
Warranties are recorded as a liability on the balance sheet and as charges
to current expense for estimated normal warranty costs and, if applicable,
for specific performance issues known to exist on products already sold.
The expenses estimated to be incurred are provided at the time of sale and
adjusted as needed, based primarily upon experience.
Changes in the Company's warranty accrual during the six months ended May
29, 2004 are as follows:
Balance at November 30, 2003 $ 1,789
Accruals for warranties issued during the period 320
Accruals related to pre-existing warranties 70
Settlements made during the period (434)
Other adjustments, including currency translation 5
-------
Balance at May 29, 2004, included in other current liabilities $ 1,750
=======
Page 8
CLARCOR Inc.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
(Unaudited) Continued
8. GOODWILL AND INTANGIBLES
The following table summarizes the activity for acquired intangibles by
reporting unit for the six months ended May 29, 2004.
2004
--------------------------------------------------------------
Currency
Beginning Translation End of
of Year Acquisitions Adjustments Amortization Quarter
--------- ------------ ----------- ------------ -------
Goodwill:
Engine/Mobile Filtration $ 12,170 $ 2,519 $ 142 $ - $14,831
Industrial/Environmental Filtration 70,550 - 8 - 70,558
Packaging - - - - -
--------- ------------ ----------- ------------ -------
$ 82,720 $ 2,519 $ 150 $ - $85,389
========= ============ =========== ============ =======
Trademarks:
Engine/Mobile Filtration $ 603 $ - $ - $ - $ 603
Industrial/Environmental Filtration 28,873 - - - 28,873
Packaging - - - - -
--------- ------------ ----------- ------------ -------
$ 29,476 $ - $ - $ - $29,476
========= ============ =========== ============ =======
Other acquired intangibles, gross:
Engine/Mobile Filtration $ 1,040 $ 115 $ (3) $ - $ 1,152
Industrial/Environmental Filtration 13,104 - - - 13,104
Packaging - - - - -
--------- ------------ ----------- ------------ -------
14,144 115 (3) - 14,256
Less accumulated amortization 3,989 - - 380 4,369
--------- ------------ ----------- ------------ -------
Other acquired intangibles, net $ 10,155 $ 115 $ (3) $ 380 $ 9,887
========= ============ =========== ============ =======
Amortization expense is estimated to be $803 in 2004, $813 in 2005, $735
in 2006, $708 in 2007 and $653 in 2008.
9. RETIREMENT BENEFITS
On December 23, 2003, the FASB issued SFAS No. 132R, "Employers'
Disclosures about Pensions and Other Postretirement Benefits." This
Statement requires additional disclosures to be made by employers
regarding pensions and other postretirement benefit plans, but does not
change the measurement or recognition of those plans. The Company adopted
the interim period disclosure provisions of this Statement in the second
quarter of 2004. All other provisions of this Statement will be adopted in
the fourth quarter of 2004.
Page 9
CLARCOR Inc.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
(Unaudited) Continued
9. RETIREMENT BENEFITS (Continued)
The Company provides various retirement benefits, including defined
benefit plans and postretirement healthcare plans covering certain
employees in the U.S. and abroad. Components of net periodic benefit cost
and company contributions for these plans were as follows:
Quarter Ended Six Months Ended
------------------ ------------------
May 29, May 31, May 29, May 31,
Pension Benefits 2004 2003 2004 2003
---------------- ------- ------- ------- -------
Components of net periodic benefit cost:
Service cost $ 879 $ 1,082 $ 1,758 $ 2,163
Interest cost 1,474 1,455 2,948 2,910
Expected return on plan assets (1,738) (1,500) (3,476) (3,000)
Amortization of unrecognized:
Prior service cost 40 35 79 70
Net actuarial loss 344 422 688 845
------- ------- ------- -------
Net periodic benefit cost $ 999 $ 1,494 $ 1,997 $ 2,988
======= ======= ======= =======
Effective January 1, 2004, the Company froze participation in one of its
defined benefit plans. Certain current plan participants will continue to
participate in the plan. Other plan participants will not accrue future
benefits under the plan, but will participate in an enhanced defined
contribution plan which offers an increased company match. The Company
recognized expense under the defined contribution plan of $711 and $371
for the second quarter 2004 and 2003, respectively and $1,454 and $787 for
the six months ended May 29, 2004 and May 31, 2003, respectively.
Quarter Ended Six Months Ended
--------------- ----------------
May 29, May 31, May 29, May 31,
Postretirement Healthcare Benefits 2004 2003 2004 2003
---------------------------------- ------ ------ ------ ------
Components of net periodic benefit cost:
Service cost $ 31 $ 29 $ 62 $ 57
Interest cost 54 59 109 119
Expected return on plan assets - - - -
Amortization of unrecognized:
Prior service cost - - - -
Net actuarial gain (8) (5) (16) (10)
------ ------ ------ ------
Net periodic benefit cost $ 77 $ 83 $ 155 $ 166
====== ====== ====== ======
The Company's general funding policy for its pension and postretirement
plans is to make contributions as required by applicable regulations. The
Company does not expect to make a contribution to its U.S. defined benefit
pension plan during fiscal year 2004. The expected
Page 10
CLARCOR Inc.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
(Unaudited) Continued
9. RETIREMENT BENEFITS (Continued)
contribution to the non-U.S. pension plan and the unfunded U.S. pension
and postretirement healthcare plans will approximate $596 for fiscal year
2004 of which $298 was paid as of May 29, 2004
10. CONTINGENCIES
The Company is involved in legal actions arising in the normal course of
business. Additionally, the Company is party to various proceedings
relating to environmental issues. The U.S. Environmental Protection Agency
(EPA) and/or other responsible state agencies have designated the Company
as a potentially responsible party (PRP), along with other companies, in
remedial activities for the cleanup of waste sites under the federal
Superfund statute.
Although it is not certain what future environmental claims, if any, may
be asserted, the Company currently believes that its potential liability
for known environmental matters does not exceed its present accrual of
$50. However, environmental and related remediation costs are difficult to
quantify for a number of reasons, including the number of parties
involved, the difficulty in determining the extent of the contamination,
the length of time remediation may require, the complexity of the
environmental regulation and the continuing advancement of remediation
technology. Applicable federal law may impose joint and several liability
on each PRP for the cleanup.
It is the opinion of management, after consultation with legal counsel
that additional liabilities, if any, resulting from these legal or
environmental issues, are not expected to have a material adverse effect
on the Company's financial condition or consolidated results of
operations.
In the event of a change in control of the Company, termination benefits
may be required for certain executive officers and other key employees.
11. SEGMENT DATA
The Company operates in three principal product segments: Engine/Mobile
Filtration, Industrial/Environmental Filtration and Packaging. The segment
data for the second quarter and six months ended May 29, 2004 and May 31,
2003, respectively, are shown below. Net sales represent sales to
unaffiliated customers as reported in the consolidated condensed
statements of earnings. Intersegment sales were not material.
Quarter Ended Six Months Ended
------------------- -------------------
May 29, May 31, May 29, May 31,
2004 2003 2004 2003
-------- -------- -------- --------
Net sales:
Engine/Mobile Filtration $ 82,992 $ 73,066 $153,792 $139,842
Industrial/Environmental Filtration 98,249 95,852 187,211 186,221
Packaging 17,471 16,857 32,981 31,206
-------- -------- -------- --------
$198,712 $185,775 $373,984 $357,269
======== ======== ======== ========
Page 11
CLARCOR Inc.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
(Unaudited) Continued
11. SEGMENT DATA (Continued)
Quarter Ended Six Months Ended
---------------------- ---------------------
May 29, May 31, May 29, May 31,
2004 2003 2004 2003
--------- --------- --------- ---------
Operating profit:
Engine/Mobile Filtration $ 16,812 $ 14,253 $ 31,237 $ 26,939
Industrial/Environmental Filtration 5,864 5,417 9,116 7,790
Packaging 1,117 868 1,253 1,296
--------- --------- --------- ---------
23,793 $ 20,538 $ 41,606 $ 36,025
Other income (expense) (217) 39 368 (329)
--------- --------- --------- ---------
Earnings before income taxes and
minority earnings $ 23,576 $ 20,577 $ 41,974 $ 35,696
========= ========= ========= =========
Identifiable assets:
Engine/Mobile Filtration $ 161,118 $ 150,162
Industrial/Environmental Filtration 296,101 301,314
Packaging 41,697 43,161
Corporate 63,814 51,235
--------- ---------
$ 562,730 $ 545,872
========= =========
12. NEW ACCOUNTING STANDARDS
On May 19, 2004, the FASB issued FASB Staff Position (FSP) No. 106-2,
"Accounting and Disclosure Requirements Related to the Medicare
Prescription Drug, Improvement and Modernization Act of 2003," which
supersedes FSP No. 106-1, "Accounting and Disclosure Requirements Related
to the Medicare Prescription Drug, Improvement and Modernization Act of
2003," (the Act). FSP No. 106-2 permits a sponsor of a postretirement
health care plan that provides a prescription drug benefit to make a
one-time election to defer accounting for the effects of the Act until
authoritative guidance on accounting for subsidies provided by the Act is
issued. The Act introduces a prescription drug benefit under Medicare as
well as a federal subsidy to sponsors of retiree health care benefit
plans. The Company does not anticipate that the Act will have a material
effect on the measurement of the Company's postretirement obligations. FSP
No. 106-2 is effective for the Company's fourth quarter 2004.
Page 12
Part I - Item 2
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS: SECOND QUARTER OF 2004 COMPARED WITH SECOND QUARTER OF
2003.
CLARCOR reported record sales, operating profit and net earnings for the second
quarter of 2004. Sales increased 7.0%, operating profit increased 15.8% and net
earnings increased 14.3% over the same quarter in 2003. A small acquisition
added approximately $1,400,000 in sales for the quarter with no material impact
on operating profit or net earnings.
Net sales of $198,712,000 increased 7.0% from $185,775,000 reported for the
second quarter of 2003. Approximately one point of the increase resulted from an
acquisition and the impact of favorable currency translation rates.
The Engine/Mobile Filtration segment reported increased sales of 13.6% to
$82,992,000 from $73,066,000 in 2003. Sales increased approximately 2.5 points
due to sales from an acquisition completed in the 2004 quarter and favorable
currency translation. The additional sales growth of approximately 11.1 points
was primarily due to growth in heavy-duty engine and railroad filter markets.
Increased economic activity in the United States along with increased market
share drove this sales growth. Sales prices were increased as a result of higher
raw material costs, principally metal products, which resulted in higher sales
of approximately $1,000,000 for the 2004 quarter.
The Company's Industrial/Environmental Filtration segment recorded a 2.5%
overall increase in sales to $98,249,000 for the 2004 quarter from $95,852,000
for the 2003 second quarter. The increased sales level was primarily due to
strong demand for aerospace and aviation fuel systems filtration. Additionally,
a small increase in sales for HVAC filters used in building maintenance and air
quality equipment reflects recent improved economic activity in the United
States. Sales in these markets were sluggish throughout 2003 and in the early
part of 2004. Less than one-half point of the segment's sales increase was
related to favorable currency translation during the 2004 quarter.
The Packaging segment reported sales of $17,471,000 compared to $16,857,000 in
2003. Sales increases for the quarter were related to flat sheet metal
decorating; however, these increases were offset by reduced sales of plastic
packaging and metal container sales that were particularly strong in 2003.
Operating profit for the second quarter of 2004 was $23,793,000 compared to
$20,538,000 in 2003, a 15.8% increase. The operating profit increase resulted
primarily from the Engine/Mobile segment's sales growth, from continued cost
reduction programs throughout each of the business segments, and from
restructuring and integration programs in the Industrial/Environmental segment.
Raw material cost increases were partially offset by price adjustments to
customers. Included in selling and administrative expenses for the six-month
period were costs of approximately $700,000 related to activities required for
compliance with Sarbanes-Oxley Rule Section 404 and approximately $400,000
related to the relocation of the corporate offices to Nashville, TN. Operating
margin improved to 12.0% of sales compared to 11.1% in 2003.
The Engine/Mobile Filtration segment recorded operating profit of $16,812,000,
an 18.0% increase compared to 2003. This increase resulted primarily from sales
growth, cost reduction programs and favorable capacity utilization that offset
higher raw material costs. The segment's operating margin was 20.3% compared to
19.5% recorded in the second quarter of 2003.
Page 13
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, Continued
The Industrial/Environmental Filtration segment reported operating profit of
$5,864,000 in 2004 compared to $5,417,000 in 2003, an 8.3% increase. Sales
increases in the aerospace and aviation fuel systems markets favorably improved
profit along with continued benefit from cost reduction initiatives and
restructuring and integration programs. The segment's operating margin improved
to 6.0% compared to 5.7% in the 2003 quarter.
The Packaging segment's operating profit in the 2004 quarter was $1,117,000
compared to $868,000 in 2003. The increase resulted from increased utilization
of metal decorating facilities offset by unfavorable absorption related
primarily to reduced plastic product and metal container sales. The segment's
operating profit was also affected by higher raw material costs, though
operating margin improved to 6.4% in the 2004 quarter compared to 5.1% in 2003.
Net other expense for the 2004 quarter totaled $217,000 compared to net other
income of $39,000 in 2003. Interest expense of $109,000 in 2004 was
significantly lower than $450,000 recorded in 2003 as a result of lower debt
balances during the 2004 period. Foreign currency exchange rates resulted in
approximately $244,000 of expense in the 2004 quarter compared to currency gains
of $568,000 in 2003.
Earnings before income taxes and minority interests for the second quarter of
2004 totaled $23,576,000, compared to $20,577,000 in the comparable quarter last
year. The provision for income taxes in 2004 was $8,567,000 compared to
$7,499,000 in 2003. The effective rate was 36.3% in 2004 and 36.4% in 2003
Net earnings in the second quarter of the current year were $14,914,000, or
$0.58 per share on a diluted basis. Net earnings in the second quarter of 2003
were $13,047,000, or $0.51 per share on a diluted basis. Diluted average shares
outstanding were 25,872,920 at the end of the second quarter of 2004, an
increase of 1.7% from the average of 25,435,452 for the 2003 quarter.
SIX MONTHS OF 2004 COMPARED TO SIX MONTHS OF 2003.
Net sales increased to $373,984,000 from $357,269,000 in 2002, a 4.7% increase.
The sales increase includes approximately $1,400,000 recorded in the 2004 second
quarter from a small acquisition. Sales increases were recorded in each of the
Company's segments. Approximately one-half point of the increase in sales is due
to favorable currency exchange rates.
The Engine/Mobile Filtration segment reported sales of $153,792,000 in the 2004
period compared to $139,842,000 in the 2003 six-month period, a 10.0% increase.
The sales increase was primarily from heavy-duty engine and railroad filtration
growth. The heavy-duty sales growth resulted from additional sales through
aftermarket and national account distribution and sales to railroads and
railroad equipment maintenance companies. International sales increased, both in
local currencies and U.S. dollars. Price increases, a small acquisition and
favorable currency exchange rates collectively accounted for approximately 2.2
points of the sales increase.
The Industrial/Environmental Filtration segment reported sales of $187,211,000,
a 0.5% increase over 2003 six-month sales of $186,221,000. This increase
resulted primarily from strong sales of filters used in aviation and aerospace
applications offset partially by reduced sales early in the 2004 period of air
quality equipment and HVAC filters used in building maintenance. Less than
one-half point of the overall sales increase was related to favorable currency
translation during the 2004 six-month period.
Page 14
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, Continued
Packaging segment sales of $32,981,000 were 5.7% higher than sales in the 2003
six-month period. The increase was primarily due to higher flat sheet metal
decorating and tooling charges billed to customers that more than offset lower
sales of plastic packaging and metal container sales in the six-month period.
Operating profit for the 2004 six-month period totaled $41,606,000 compared to
$36,025,000 in 2003, an increase of 15.5%. The improvement in operating profit
resulted primarily from the Engine/Mobile segment's sales growth. Additionally,
cost reduction programs and productivity improvement plans continue to be
implemented throughout each of the business segments. Included in selling and
administrative expenses for the six-month period were costs of approximately
$700,000 related to activities required for compliance with Sarbanes-Oxley Rule
Section 404 and approximately $400,000 related to the relocation of the
corporate offices to Nashville, TN. Operating margin improved to 11.1% of sales
compared to 10.1% in 2003.
The Engine/Mobile Filtration segment reported operating profit of $31,237,000
for the six-month period, a 16.0% increase over the 2003 period. The segment's
sales growth significantly improved the operating profit for the quarter due to
the impact of improved capacity utilization. Cost increases for raw material
purchases were partially offset by price increases. Continued cost reduction
programs also improved the segment's operating profit. The segment's operating
margin was 20.3% compared to 19.3% reported for the 2003 six-month period.
The Industrial/Environmental Filtration segment reported operating profit of
$9,116,000 compared to $7,790,000 for the 2003 six-month period. This increase
of 17.0% resulted from sales growth for specialty process liquid filters and
aviation filtration products. Cost reduction and productivity improvement
programs more than offset lower overhead absorption due to lower sales levels
for HVAC filtration and air quality equipment. The segment's operating margin
improved to 4.9% compared to 4.2% in the 2003 six-month period.
The Packaging segment reported operating profit of $1,253,000 for the 2004
six-month period compared to $1,296,000 in the 2003 period. The slight decrease
resulted primarily from reduced plastic product sales and reduced utilization of
facilities related to plastic packaging products in the 2004 period. As a result
of increased sales of lower margin flat sheet decorating and lower sales of
plastic packaging and metal containers, the segment's operating margin for the
2004 period was 3.8% compared to 4.2% in 2003.
Net other income for the 2004 six-month period of $368,000 included a gain of
$720,000 from the first quarter 2004 sale of a building, interest expense of
$227,000, foreign currency translation expense of $196,000 and interest income
of $137,000. Net other expense in 2003 of $329,000 included interest expense of
$974,000, foreign currency translation income of $746,000 and interest income of
$130,000. Interest expense was lower in 2004 due to significantly lower debt
balances during the 2004 six-month period and fluctuations in currency exchange
rates caused the change in net currency income and expense.
Earnings before income taxes and minority interests for the 2004 six-month
period totaled $41,974,000, compared to $35,696,000 in the prior year period.
The provision for income taxes in 2004 was $15,270,000 compared to $13,015,000
in 2003. The effective rate was 36.4% in 2004 and 36.5% in 2003. The Company
expects the effective tax rate for fiscal 2004 will be approximately 36.5%.
Page 15
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, Continued
Net earnings in the 2004 six-month period were $26,575,000, or $1.03 per share
on a diluted basis. Net earnings in the 2003 six-month period were $22,643,000,
or $0.89 per share on a diluted basis. Diluted average shares outstanding were
25,841,322 for the 2004 period and 25,326,543 for the 2003 six-month period. The
increase of 2.0% is primarily due to grants of stock-based incentives.
LIQUIDITY AND CAPITAL RESOURCES
Cash provided by operating activities increased to $33,611,000 for the six-month
2004 period compared to $30,467,000 in 2003, primarily due to increased net
earnings. Cash flows for investing activities totaled $12,653,000 in the 2004
six-month period and included $9,197,000 used for plant asset additions and
$4,871,000 that was used for a small acquisition at the beginning of the second
quarter. The 2004 period also included $1,415,000 that was received from the
sale of plant assets. In the 2003 period, $6,041,000 was used for additions to
plant assets. Cash flows used in financing activities totaled $5,770,000 in 2004
and included $280,000 for net repayments on debt agreements and $6,361,000 used
for dividend payments. Cash flows used in financing activities of $28,117,000 in
2003 included net repayments on debt agreements of $22,437,000 and dividend
payments of $6,120,000.
CLARCOR's current operations continue to generate cash and sufficient lines of
credit remain available to fund current operating needs, pay dividends, fund
planned capital expenditures, and provide for interest payments and required
principal payments related to the Company's debt agreements. At the end of the
second quarter of 2004, there was no outstanding balance on a $165 million
multicurrency revolving credit facility. The credit facility includes a $40
million letter of credit line subline, against which $14,111,000 had been issued
at the end of the second quarter of 2004 to support industrial revenue bonds.
Other long-term debt totaled $17,307,000 at the end of the 2004 quarter and
related principal payments in 2004 will be approximately $674,000. The Company
is in compliance with all covenants related to debt agreements.
The Company expects to continue to use cash flow for dividends, capital
expenditures and acquisitions. Capital expenditures in fiscal year 2004 are
expected to be approximately $24 million to $26 million and will be used
primarily for normal facility improvements, productivity improvements,
improvements to technical centers, and to support new products. Early in the
second quarter of 2004, the Company acquired the operating assets of a small
engine filter company in England for approximately $4,871,000, subject to
finalization of assets acquired. The Company's off-balance sheet arrangements
relate to various operating leases. Commitments for noncancelable leases in 2004
total approximately $8,229,000. The Company had no derivative, swap, hedge,
variable interest entity or special purpose entity agreements during 2004 or in
fiscal 2003.
The following table summarizes the Company's fixed cash obligations for the
various future years ending November 30:
(Dollars in thousands)
2004 2005 & 2006 2007 & 2008 Thereafter
------- ----------- ----------- ----------
Long-Term Debt $ 674 $ 503 $ - $ 16,410
Credit Facility $ - $ - $ - $ -
Operating Leases $ 8,229 $ 10,705 $ 6,834 $ 9,933
Page 16
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, Continued
While changes in customer demand for the Company's products will affect
operating cash flow, the Company is not aware of any known trends, demands or
reasonably likely events that would materially affect cash flow from operations
in the future. It is likely that cash flow from operations for fiscal 2004 will
be lower than the prior fiscal year due to additional investments in working
capital that may be required to support increased operations in fiscal 2004. In
addition, a higher level of capital expenditures is expected in fiscal 2004 than
in the prior year. The Company does not expect to make a contribution in fiscal
2004 for its defined benefit plan covering U.S. employees. It is possible that
business acquisitions or dispositions could be made in the future that may
affect operating cash flows and may require changes in the Company's debt and
capitalization.
The Company's financial position at the end of the second quarter reflected cash
and short-term investments of $23,516,000, an increase from $8,348,000 at
year-end 2003. At the end of the second quarter 2004 compared to year-end 2003,
accounts receivable increased by $269,000 and inventories increased $8,829,000
from the year-end level. The inventory increase was primarily due to inventory
requirements for increased shipments expected for the remainder of 2004. The
current ratio at the end of the second quarter was 2.5 compared to 2.3 at the
end of fiscal 2003. Goodwill increased $2,669,000 primarily as a result of the
2004 second quarter acquisition. The ratio of total debt to total capitalization
was 4.2% at the end of the 2004 second quarter compared to the year-end 2003
level of 4.5%. At the end of the second quarter 2004, CLARCOR had 25,424,542
shares of common stock outstanding.
OTHER MATTERS
Market Risk
The Company's interest expense on long-term debt is sensitive to changes in
interest rates. In addition, changes in foreign currency exchange rates may
affect assets, liabilities and commitments that are to be settled in cash and
are denominated in foreign currencies. Market risks are also discussed in the
Company's Annual Report and Form 10-K for the year ended November 30, 2003 (the
"Annual Report") in the Financial Review on page 10.
Critical Accounting Policies
The Company's critical accounting policies, including the assumptions and
judgments underlying them, are disclosed in the Company's Annual Report in the
Financial Review on page 10 and in the Notes to the Consolidated Financial
Statements on pages 16-24 and in the Notes to the Consolidated Condensed
Financial Statements included herein. These policies have been consistently
applied in all material respects and address such matters as revenue
recognition, depreciation methods, inventory valuation, asset impairment
recognition, business combination accounting and pension and postretirement
benefits. While the estimates and judgments associated with the application of
these policies may be affected by different assumptions or conditions, the
Company believes the estimates and judgments associated with the reported
amounts are appropriate in the circumstances.
Recent Accounting Pronouncements
On May 19, 2004, the FASB issued FASB Staff Position (FSP) No. 106-2,
"Accounting and Disclosure Requirements Related to the Medicare Prescription
Drug, Improvement and
Page 17
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, Continued
Modernization Act of 2003," which supersedes FSP No. 106-1, "Accounting and
Disclosure Requirements Related to the Medicare Prescription Drug, Improvement
and Modernization Act of 2003," (the Act). This Staff Position permits a sponsor
of a postretirement health care plan that provides a prescription drug benefit
to make a one-time election to defer accounting for the effects of the Act until
authoritative guidance on accounting for subsidies provided by the Act is
issued. The Act introduces a prescription drug benefit under Medicare as well as
a federal subsidy to sponsors of retiree health care benefit plans. The Company
does not anticipate that the Act will have a material effect on the measurement
of the Company's postretirement obligations. FSP No. 106-2 is effective for the
Company's fourth quarter 2004.
On December 23, 2003, the FASB issued SFAS No. 132R, "Employers' Disclosures
about Pensions and Other Postretirement Benefits." This Statement requires
additional disclosures to be made by employers regarding pensions and other
postretirement benefit plans, but does not change the measurement or recognition
of those plans. The interim period disclosure requirements of the Statement are
effective for interim periods beginning after December 15, 2003. The Company has
adopted the interim provisions of this Statement beginning in the second quarter
of 2004. All other provisions of this Statement will be adopted in the fourth
quarter of 2004.
Outlook
As reflected in the increased sales growth in second quarter 2004 compared to
the first quarter, the Company continues to expect additional sales growth
overall for the second half of 2004. Continued sales growth is expected for the
Engine/Mobile segment as a result of continued improvement in aftermarket and
national account distribution, increased sales to OEM dealers and sales of new
products. Sales are expected to increase for the Industrial/Environmental
segment as the economy improves and additional facility maintenance occurs. The
Total Filtration Program is also expected to benefit from the completion of the
conversion of a group of 20 company-owned branches from selling primarily HVAC
filtration products to selling the Company's entire range of liquid and air
filter products. Sales and operating profit growth are expected for the
Packaging segment for 2004.
As a result of the anticipated overall sales growth for the Company combined
with continued cost control efforts for the remainder of the year, it is
expected that diluted earnings per share for 2004 will be in the $2.30 to $2.40
range. This range does not include estimated costs of approximately $0.07 per
share related to moving the Company's headquarters to Nashville, TN. The
majority of these costs are expected to be incurred and paid during the third
quarter of fiscal 2004.
Continued emphasis on cost reductions and price changes within each business
unit are expected to offset costs that have recently been increasing for energy
and for purchased materials, primarily metal products. These costs for the
Company may change significantly based on future changes in the U.S. and world
economies. Additional costs related to compliance with the new requirements of
Sarbanes-Oxley Rule Section 404 are expected for the remainder of 2004 and in
future fiscal periods. Capital investments will continue to be made in each
segment's facilities to improve productivity and to support new products. While
the Company fully anticipates that sales and profits will improve as a result of
sales initiatives and cost reductions, the Company has developed contingency
plans to reduce discretionary spending if unfavorable economic conditions
return.
Page 18
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, Continued
CLARCOR continues to assess acquisition opportunities, primarily in related
filtration businesses. It is expected that these acquisitions would expand the
Company's market base, distribution coverage and product offerings. The assets
of a small engine filter company were acquired early in the second quarter of
2004. This acquisition will not materially affect operating results for 2004.
FORWARD-LOOKING INFORMATION IS SUBJECT TO RISK AND UNCERTAINTY
Certain statements quoted in the body of this report, and statements in the
"Outlook" section of this report are forward-looking. These statements involve
risk and uncertainty. Actual future results and trends may differ materially
depending on a variety of factors including: the volume and timing of orders
received during the period; the mix of changes in distribution channels through
which the Company's products are sold; the success of the Company's Total
Filtration Program; the timing and acceptance of new products and product
enhancements by the Company or its competitors; changes in pricing, labor
availability and related costs, product life cycles, raw material costs,
insurance, pension, energy costs, and purchasing patterns of distributors and
customers; competitive conditions in the industry; business cycles affecting the
markets in which the Company's products are sold; the success of sales and
marketing programs; the effectiveness of plant conversions, plant expansions and
productivity improvement programs; the management of both growth and
acquisitions; the cost of the relocation of the Company's corporate offices; the
cost of compliance with recently enacted regulatory requirements such as
Sarbanes-Oxley Rule Section 404; the fluctuation in foreign and U.S. currency
exchange rates; extraordinary events such as litigation, acquisitions or
divestitures including related charges; market disruptions caused by domestic or
international conflicts; and economic conditions generally or in various
geographic areas. All of the foregoing matters are difficult to forecast. The
future results of the Company may fluctuate as a result of these and the other
risk factors detailed from time to time in the Company's Securities and Exchange
Commission reports.
Due to the foregoing items it is possible that in some future quarters the
Company's operating results will be below the expectation of some stock market
analysts and investors. In such event, the price of CLARCOR common stock could
be materially adversely affected.
Page 19
Part I - Item 3. Quantitative and Qualitative Disclosure About Market Risk.
The information required hereunder is set forth on Page 14 of the
Quarterly Report under the captions "Management's Discussion and
Analysis - Other Matters - Market Risk."
Part I - Item 4. Controls and Procedures.
The Company has established disclosure controls and procedures which
are designed to ensure that information required to be disclosed in
reports filed or submitted under the Securities Exchange Act of 1934
are recorded, processed, summarized, and reported within the time
periods specified in the Securities and Exchange Commission's rules and
forms. Norman E. Johnson, Chairman of the Board, President, and Chief
Executive Officer and Bruce A. Klein, Vice President - Finance and
Chief Financial Officer, evaluated the effectiveness of the Company's
disclosure controls and procedures as of May 29, 2004. Based on their
evaluation, they concluded that the Company's disclosure controls and
procedures were effective in achieving the objectives for which they
were designed. No change in the Company's internal control over
financial reporting occurred during the Company's most recent fiscal
quarter ended May 29, 2004 that has materially affected, or is
reasonably likely to materially affect, the Company's internal control
over financial reporting.
Page 20
Part II - Other Information
Item 2 Changes in Securities, Use of Proceeds and Issuer Purchases of Equity
Securities
The Company currently does not have a stock repurchase program.
Accordingly, no shares were repurchased during the quarter ended May
29, 2004. However, upon the exercise of stock options during the
quarter, 37,845 mature shares were exchanged in payment of the related
exercise price and taxes payable.
Item 4 Submission of Matters to a Vote of Security Holders
At the annual meeting of shareholders of CLARCOR Inc. held on March 22,
2004, all of management's nominees for directors, as listed in the
proxy statement dated February 18, 2004, were elected. The Company had
25,372,273 shares of common stock outstanding as of the close of
business on the February 5, 2004 record date, and the holders of
22,673,292 shares of common stock were present at the meeting, in
person or by proxy.
The three nominees elected received votes as follows:
For Withheld
Robert J. Burgstahler 21,851,688 821,604
Paul Donovan 21,846,333 826,959
Norman E. Johnson 22,264,067 409,225
Also at the annual meeting, the shareholders approved the Company's
2004 Employee Stock Purchase Plan with a vote of 19,598,216 in favor,
233,235 against and 263,578 withheld.
Item 6 Exhibits and Reports on Form 8K
a. Exhibits:
31(i) Certification of Norman E. Johnson pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002
31(ii) Certification of Bruce A. Klein pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
32(i) Certification pursuant to 18 U.S.C. Section 1350 as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
c. Report Filed on Form 8-K During the Second Quarter Ended May 29, 2004.
Form 8-K dated March 18, 2004 reporting Item 7 -- Financial
Statements and Exhibits and Item 5 -- Other Events. Item 7 (c)
included an exhibit 99.1, "CLARCOR Press Release dated March
18, 2004".
c. Report Filed on Form 8-K Subsequent to the Second Quarter Ended May 29,
2004. Form 8-K dated June 7, 2004 reporting Item 5 -- Other
Events and Regulation FD Disclosure. Item 5 disclosed that
Robert H. Jenkins replaced Paul Donovan as a member of the
Audit Committee of the Company.
Page 21
SIGNATURE
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.
CLARCOR INC.
(Registrant)
June 18, 2004 By /s/ Norman E. Johnson
------------------------ --------------------------------------
(Date) Norman E. Johnson
Chairman of the Board, President and
Chief Executive Officer
June 18, 2004 By /s/ Bruce A. Klein
------------------------ --------------------------------------
(Date) Bruce A. Klein
Vice President - Finance and
Chief Financial Officer
Page 22