10-K/A

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

Annual Report Pursuant to Section 13 or 15(d)
of The Securities Exchange Act of 1934

For the Fiscal Year Ended December 31, 2001

BUTLER MANUFACTURING COMPANY
1540 Genessee Street
(P.O. Box 419917)
Kansas City, Missouri 64102
Telephone: (816) 968-3000

Incorporated in the State of Delaware

COMMISSION FILE NO.      0-603

IRS No.      44-0188420

     The company has no securities registered pursuant to Section 12(g) of the Act. The only class of stock outstanding consists of Common Stock having no par value, 6,296,228 shares of which were outstanding at February 20, 2002. The Common Stock and related Preferred Share Purchase Rights are registered pursuant to Section 12(b) of the Act on the New York Stock Exchange.

     The aggregate market value of the Common Stock of the company held by non-affiliates, based upon the last sales price of such stock on February 20, 2002, was $155,253,125.

     The company has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and has been subject to such filing requirements for the past 90 days.

     As indicated by the following check mark, disclosure of delinquent filers pursuant to Rule 405 of Regulation S-K is not contained herein and will not be contained to the best of Registrant’s knowledge in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K: [    ]

     The following documents are incorporated herein by reference:

(1)	Butler Manufacturing Company 2001 Annual Report, pages 14 through 36 (the “Annual Report”) incorporated into Part II.
(2)	Butler Manufacturing Company Notice of Annual Meeting of Stockholders and Proxy Statement, dated March 14, 2002 (the “Proxy Statement”) incorporated into Parts I and III).

BUTLER MANUFACTURING COMPANY

FORM 10-K

For the Fiscal Year Ended December 31, 2001

CONTENTS

PART I	Page
Item 1.  Business		3
Item 2.  Properties		7
Item 3.  Legal Proceedings		7
Item 4.  Submission of Matters to a Vote of Security Holders		8
PART II
Item 5.  Market for Registrant’s Common Equity and Related Stockholder Matters		8
Item 6.  Selected Financial Data		8
Item 7.  Management’s Discussion and Analysis of Financial Condition and Results of Operations		8
Item 7A.  Quantitative and Qualitative Disclosure About Market Risk		8
Item 8.  Financial Statements and Supplementary Data		8
Item 9.  Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		8
PART III
Item 10.  Directors and Executive Officers of the Registrant		9
Item 11.  Executive Compensation		10
Item 12.  Security Ownership of Certain Beneficial Owners and Management		11
Item 13.  Certain Relationships and Related Transactions		11
PART IV
Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K		11
SIGNATURES		15
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS		16
FINANCIAL STATEMENT SCHEDULES		S-1

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PART I

Item 1. Business

(a)      General Description of Business

     The Butler Manufacturing Company (the “company”) was founded as a partnership in 1901, incorporated in Missouri in 1902, and later reincorporated in Delaware in 1969. Its corporate headquarters are located in Kansas City, Missouri, and the company operates manufacturing facilities, engineering offices, and service centers throughout the continental United States, and 15 foreign countries. Principal international operations are conducted through a Chinese wholly owned subsidiary, Butler (Shanghai) Inc., Butler Europe Kft., a wholly owned Hungarian subsidiary, and Saudi Building Systems Ltd., a minority owned Saudi Arabian joint venture.

     The company is primarily engaged in the marketing, design, and production of building systems and components for nonresidential structures. Products and services fall into five principal business segments: (1) North American Building Systems, consisting primarily of custom designed and pre-engineered steel and wood frame building systems for commercial, community, industrial, governmental, and agricultural uses; (2) International Building Systems, consisting primarily of custom designed and pre-engineered steel buildings for commercial, community, industrial, and governmental use; 3) Architectural Products, consisting primarily of curtain wall and storefront framing systems, standard and custom window systems, skylights, and roof vents for low-rise, medium-rise, and high-rise nonresidential buildings; (4) Construction Services, providing construction management services for purchasers of large, complex, or multiple site building projects; and (5) Real Estate, providing build-to-suit-to-lease development services for corporations who prefer to lease rather than own their facilities.

     The company’s products are sold, installed, and serviced through over 3,700 independent dealers or contractors that serve the commercial, community, industrial, agricultural, and governmental markets.

(b)      Financial Information About Industry Segments

     The information required by Item 1(b) is incorporated by reference to the note captioned “Business Segments” on pages 28 and 29 of the Company’s Annual Report, of which pages 14 through 36 are attached as Exhibit 13.1 to this report. See also items 6, 7, 7A, and 8 of this report.

(c)      Narrative Description of Business

North American Building Systems

     The company’s largest segment, North American Building Systems, includes principally the United States, Canadian, and Latin American pre-engineered metal building systems businesses, as well as the wood frame buildings business and Liberty Building Systems Inc.

     The company’s North American Building Systems Segment activities consist primarily of the design, engineering, fabrication, and distribution of one to five-story steel and one to two-story wood framed buildings for industrial, commercial, community, governmental, and agricultural uses, such as manufacturing facilities, warehouses,

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office buildings, schools, churches, shopping centers, restaurants, convenience stores, livestock, and farm buildings. Principal product components of the systems are structural members and a variety of pre-engineered wall and roof components. These are fabricated according to standard or customer specifications and shipped to building sites for assembly primarily by independent dealers. Building components are manufactured for North American sales and export sales in plants located at Galesburg and Charleston, Illinois; Laurinburg, North Carolina; Birmingham, Alabama; Visalia, California; Annville, Pennsylvania; San Marcos, Texas; Lester Prairie, Minnesota; Selmer Tennessee; and Clear Brook, Virginia.

     The U.S. export operation markets and engineers metal building systems for the Central American, Caribbean, and select Latin American markets. Shipments are sourced primarily from Butler’s U.S. plants and local manufacturing alliances. The company also serves the Canadian market through a branch office in Burlington, Ontario.

     Building Systems’ products are distributed throughout the world by independent Butler dealers. The dealers provide construction services and in many cases complete design and engineering capabilities.

     Nonresidential pre-engineered buildings compete with conventional forms of building construction in the low-rise commercial, community, industrial, agricultural, and governmental markets. Competition is primarily based upon cost, time of construction, appearance, thermal efficiency, and other specific customer requirements.

     The company also competes with numerous pre-engineered steel frame building manufacturers doing business within the United States, Canada, Europe, South America, and China. The company believes that its 2001 sales of steel frame pre-engineered building systems within the United States exceeded those of any other nonresidential steel frame pre-engineered building systems manufacturer, with its next largest competitors being NCI Building Systems, Inc., V. P. Buildings Inc., a wholly owned subsidiary of Grupo IMSA, S.A. de C.V. of Mexico, American Buildings Co., an operating unit of MAGNATRAX Corporation, and Ceco Building Systems and Star Building Systems, operating units of Robertson-Ceco Corporation. Competition among manufacturers of pre-engineered buildings is based primarily upon price, service, product design and performance, and marketing capabilities.

     Lester Building Systems, the company’s wood frame buildings business, sells its products through independent dealers, and direct-sales operations, and is believed to rank third in sales to Morton Buildings, Inc. and Cleary Buildings, Inc.

International Building Systems

     The International building systems business segment includes Butler (Shanghai) Inc., a wholly owned Chinese metal building systems subsidiary; Butler Europe Kft., a wholly owned European metal building systems subsidiary, with manufacturing operations in Hungary, and marketing and engineering subsidiaries in the United Kingdom, France, Germany, and Poland; and Saudi Building Systems Ltd., a minority owned Saudi Arabian metal buildings joint venture.

     Butler (Shanghai) Inc. markets, engineers, and fabricates metal building systems for Asian markets from a plant in Shanghai, China. In 2001, the company completed construction of a new office located adjacent to its Shanghai manufacturing facility.

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     In early 2002, the company announced its intention to add a second manufacturing plant in China. Its costs is anticipated to be approximately $11 million. Production is expected to commence in early 2003

     Early in 2002, the company announced it had entered into a letter of intent to sell certain assets of its Hungarian metal building systems subsidiary, close its European sales and engineering offices, and dispose of the remaining assets of the business. The relatively small scale of the European operation, the continued loss position of the business, and a business recession in Europe contributed to this decision. The company recorded a $3.6 million after tax charge related to the disposition of this business. The sale originally anticipated to occur in the first quarter, is now expected to close in the second quarter of 2002.

     Saudi Building Systems, Ltd. manufactures pre-engineered steel frame buildings for Middle Eastern markets at manufacturing facilities located in Jeddah, Saudi Arabia.

Architectural Products

     This segment includes the operations of the Vistawall group which designs, manufactures, and sells aluminum extruded curtain wall systems for mid and high-rise office markets. Vistawall also sells entry doors, standard and custom architectural window systems, translucent roof and wall systems, custom and standard skylights, and other standard storefront products for low-rise retail and commercial markets. The Vistawall group’s products are distributed on a material supply basis to either curtain wall erection subcontractors or general contractors, and through its distribution warehouses, to glazing contractors for storefront and entry door applications. Manufacturing and distribution facilities are located in Warwick, Rhode Island; Newnan and Tucker, Georgia; Modesto, Hayward, and, Rancho Cucamonga, California; Denver, Colorado; Brooklyn Park, Minnesota; Cincinnati and Cleveland, Ohio; Midway, Tennessee; Terrell, Houston, and Dallas, Texas; Tampa, Florida; Chicago, Illinois; Jessup, Maryland; St. Louis, Missouri; Seattle, Washington; and Wausau, Wisconsin. In 2001 Vistawall added to its production capacity with a newly completed extruding and finishing facility located in Midway, Tennessee.

     The Vistawall Group operates in highly competitive markets with other national manufacturers which operate multiple plants and distribution facilities, and with regional manufacturers. Competition is primarily based on price, engineering and installation capabilities, delivery, appearance, and other specific customer requirements.

     During 2001, the company acquired a 40% interest in Vistawall International Ltd, a United Arab Emirates joint venture formed to design, manufacture, and sell architectural aluminum products in Middle Eastern markets. Investments and business activity in the new joint venture have been minimal during the start-up year.

Construction Services

     The company’s Construction Services segment consists of Butler Construction, a wholly owned construction subsidiary also known as BUCON, Inc., which provides comprehensive design, planning, execution, and construction management services to major purchasers of construction. Butler Heavy Structures is an operating unit of Butler Construction serving markets requiring large, complex building designs using fabricated mill steel in combination with Butler’s pre-

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engineered secondary structural and metal cladding systems. Revenues from the Construction Services segment are derived primarily from “material-erect” and “material only” subcontracts, and selective pursuit of turnkey construction projects using products from several company businesses, predominantly the company’s U.S. metal buildings businesses.

     This business segment competes with international, national, regional, and local general contracting firms, and whenever possible, performs projects in conjunction with independent Butler dealers. Competition is primarily based upon price, design, speed of project execution, and product performance.

Real Estate

     This business segment consists solely of Butler Real Estate, Inc., a wholly owned subsidiary of the company, which provides value-added real estate development and leasing services to major corporations in cooperation with Butler dealers. Butler Real Estate, Inc. generally functions as a development and financing source during the lead procurement and construction process, and as a seller of the completed project. On the basis of commitments to lease obtained from credit worthy customers, Butler Real Estate, Inc. acquires building sites, arranges with Butler dealers for construction of build-to-suit projects, and sells the completed projects to permanent investors when the facilities are occupied by lessees.

Manufacturing and Materials

     The company’s manufacturing facilities include most conventional metal fabricating operations, such as punching, shearing, welding, extruding, and forming of sheet and structural steel and aluminum. Other metal manufacturing processes include painting and anodizing. Wood frame manufacturing operations include sawing and truss fabrication. The principal materials used in the manufacture of products include steel, aluminum, wood, and purchased parts. Materials are presently available in sufficient quantities to meet current needs.

     In March, 2002, the United States invoked tariffs on certain steel product imports. While it is too soon to determine the impact of such tariffs on nonresidential construction in general and the company’s operations specifically, management does not forsee any disruption in the supply of steel products used in its operation. It is also expected that any changes in raw material prices will be passed along in the company’s product pricing.

Business Cycles and Seasonal Demand

     Historically, the company’s sales and net earnings have been affected by cycles in the general economy which influence nonresidential construction markets (see in particular Item 7 of this report). At the close of 2001, most global economies were in a recession, and the near-term outlook for the nonresidential constructions markets were soft. The company also experiences seasonal demand for products and services. Sales for the first, second, third, and fourth quarters of 2001 were $195 million, $214 million, $250 million, and $238 million, respectively.

Backlog

     The company’s backlog of orders believed to be firm was $291 million at December 31, 2001, 3% lower than a year ago.

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Employees

     At December 31, 2001 the company employed 4,719 persons, 4,002 of whom were non-union employees, and 717 of whom were hourly paid employees that were members of three unions.

Item 2. Properties

     The principal plants and physical properties of the company consist of the manufacturing facilities described under Item 1 and its world headquarters office in Kansas City, Missouri. Through a subsidiary, the company also owns a land development venture with property located on an approximately 75 acre site in San Marcos, Texas. The property is recorded as “Assets held for sale” and described in a footnote on page 27 in the company’s Annual Report. All other plants and offices described under Item 1 are utilized by the company and are generally suitable and adequate for the business activity conducted therein. The company’s manufacturing facilities described under Item 1, along with current outsourcing agreements with various domestic and foreign fabricators, provide production capabilities sufficient to meet current and foreseeable needs.

     Except for leased facilities listed below, all of the company’s principal plants and offices are owned:

(1)	Leased space used for the company’s executive offices in Kansas City, Missouri (120,000 sq. ft. lease expired at the end of 2001). The company elected not to renew its executive office lease due to the completion and move to its new $27 million world headquarters building at year-end.
(2)	Leased space used for the Vistawall Division plant in Terrell, Texas (145,000 sq. ft. and 121,000 sq. ft. with leases expiring in 2009 and 2006, respectively, both containing options to renew), and fabrication and distribution facilities in Dallas and Houston, Texas; Jessep, Maryland; St. Louis, Missouri; Brooklyn Park, Minnesota; Chicago, Illinois; Cincinnati and Cleveland, Ohio; Atlanta and Newnan, Georgia; Tampa, Florida; Auburn, Washington; Modesto, Hayward, and Rancho Cucamonga, California; Warwick, Rhode Island; and Denver, Colorado (511,000 sq. ft. leased with various expiration dates). The company also leases a manufacturing facility (50,000 sq. ft. lease expiring in the year 2005 with three five year renewal options) located in Selmer, Tennessee.
(3)	Leased space used for Bucon, Inc. in Kansas City, Missouri (74,000 sq. ft. lease expiring in the year 2007)
(4)	The company leases various sales and engineering offices throughout the world.

Item 3. Legal Proceedings.

     There are no material legal or environmental proceedings pending as of March 26, 2002, nor does the company have any known material environmental contingencies as of this date. Proceedings which are pending consist of matters normally incident to the business conducted by the company and taken together do not appear to be material.

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Item 4. Submissions of Matters to a Vote of Security Holders.

     No matters have been submitted to a vote of stockholders since the last annual meeting of stockholders on April 17, 2001

PART II

Item 5. Market for Registrant’s Common Equity and Related Stockholder Matters.

     Incorporated by reference to the information under “Quarterly Financial Information (Unaudited)”, “Price Range of Common Stock (Unaudited)” and “Historical Review 2001-1997” on pages 35 and 36 of the Annual Report.

     On September 17, 2001 the company declared an increased in its quarterly cash dividend from 17 cents to 18 cents per share to shareholders of record as of September 28, 2001. The company has limited restrictions on the payment of dividends under certain debt covenants contained in note agreements dated June 20, 2001, March 1, 1998, and June 1, 1994 between the company and insurance companies, and the bank credit agreement dated June 20, 2001(incorporated by reference to the Forms 10-Q for the quarters ended June 30, 2001, March 31, 1998 and June 30, 1994 as indicated under Item 14). The company had approximately $29 million of retained earnings available for cash dividends and share repurchases at December 31, 2001.

Item 6. Selected Financial Data.

     Incorporated by reference to the information under “Historical Review 2001-1997” on page 36 of the Annual Report.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

     Incorporated by reference to the information under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” on pages 14 through 19 of the Annual Report.

Item 7A. Quantitative and Qualitative Disclosure About Market Risk.

     Incorporated by reference to page 17 of the Annual Report to the information under “Management’s Discussion and Analysis of Financial Condition and Results of Operations”.

Item 8. Financial Statements and Supplementary Data.

     Incorporated by reference to the consolidated financial statements and related notes on pages 20 through 36 of the Annual Report.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

     None.

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PART III

Item 10. Directors and Executive Officers of the Registrant.

     Information as to Directors is incorporated herein by reference to pages 2 through 4 of the Proxy Statement. The company’s Executive Officers, their ages, their positions and offices with the company, and their principal occupations during the past five years are shown below:

Corporate Executive Officers

John J. Holland — age 51, Chairman and Chief Executive Officer and Chairman of the Board Executive Committee. He joined Butler in 1980 and became Vice President — Controller in 1986, Vice President-Finance in 1990, Executive Vice President in 1998, and President and Chief Executive Officer in 1999, and was elected Chairman and Chief Executive Officer in November 2001. Mr. Holland is a director of Commerce Fund, a mutual fund; a Trustee of William Jewell College, and a director of Saint Luke’s Hospital, the National Association of Manufacturers, the Greater Kansas City Chamber of Commerce, the Civic Council of Greater Kansas City, and The Midwest Research Institute.

Ronald E. Rutledge — age 60, President and member of the Board Executive Committee. He Joined Butler in 1984 as President of the Vistawall Architectural Products Group and was elected Executive Vice President in April 2001. He was elected President and a Director in November 2001. He is past director of the Terrell, Texas Chamber of Commerce and the Terrell State Bank and is currently a director of the Kansas City Council for the Boy Scouts of America.

Barbara B. Bridger — age 44, Vice President-Human Resources since 1999. She joined Butler in 1980 and previously was Vice President- Human Resources for the Buildings Division.

John T. Cole — age 51, Controller since 1990. He joined Butler in 1977 and previously was Corporate Audit Manager.

John W. Huey — age 54, Vice President, General Counsel, and Secretary since 1999. He joined Butler in 1978 and became Vice President-Administration in 1993 and Assistant General Counsel and Assistant Secretary in 1987.

Lee E. Lichlyter — age 38, Vice President-Chief Information Officer since 2000, and previously was Vice President of Information Systems Building Division.

Paul F. Liljegren — age 47, Treasurer since 1998. He joined Butler in 1979 and previously was Vice President and Controller of Lester Building Systems.

Larry C. Miller — age 45, Vice President-Finance since 1998. He joined Butler in 1980 and was previously the company’s Treasurer.

Division Executive Officers

Moufid (Mike) Alossi — age 59, President, Butler (Shanghai) Inc., since 1997. He joined Butler in 1968 and was previously President of Butler World Trade and Vice President-International Sales and Marketing.

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John R. Hill — age 44, President, Lester Building Systems since 2000. He joined Butler in 1980. He was previously Senior Vice President of Sales of Lester Building Systems.

Thomas J. Hall — age 56, President, Butler Real Estate, Inc. since 1991. He joined Butler in 1969, and was named Vice President and General Manager of Butler Real Estate, Inc. in 1987.

Thomas W. Harris — age 49, President, Vistawall Group since 2001. He join Butler in 1984. He previously was Vice President Sales and Marketing from 1997 to 2000, and Vice President Vistawall Central Region in 2001.

William L. Johnsmeyer — age 54, President, Bucon, Inc. since 1990. He joined Butler in 1982 and became President, Walker Division in 1984.

Clyde E. Wills, Jr. — age 56, President, Buildings Division since 1999. He first joined Butler in 1972. He was previously Senior Vice President of Operations, Building Division from 1992 to 1997 and was President of the International Division in 1998.

Item 11. Executive Compensation.

     Incorporated by reference to the information under “Report of the compensation and Benefits Committee on Executive Compensation,” “Summary Compensation Table,” “Aggregated Option Exercises and Fiscal Year-End Option Value Table,” “Pension Plan Table,” and “Restricted Stock Bonus Program” on pages 15 through 19 of the Proxy Statement.

     The Long Term Incentive Plan referred to in the Report of the Compensation and Benefits Committee on executive compensation contemplates three year performance cycles, each cycle commencing the beginning of each year, the first of which began on January 1, 2001. As stated in the Committee’s report, the performance measure for awards is based on total business return, a measure of the creation of economic value in the Company’s business. Generally, total business return is calculated by (i) dividing changes in net operating profit after taxes by the weighted average cost of capital, (ii) adding free cash flow for the three year period, and (iii) dividing the result by beginning investment levels. The levels of total business return required for threshold, target and maximum payments over the initial performance period ending in 2003 are 25%, 35% and 55%, respectively. The following table shows the amounts that might be paid with respect to the three year period ended December 31, 2003 to the chief executive officer and the four most highly compensated officers at the threshold, target and maximum levels.

Estimated Future Payouts After Three Years Ended 12/31/03

	Threshold		Target		Maximum
John J. Holland	$	138,000.	$	276,000.	$	552,000.
Ronald E. Rutledge	$	54,000.	$	108,000.	$	216,000.
Larry C. Miller	$	15,500.	$	31,000.	$	62,000.
John W. Huey	$	15,500.	$	31,000.	$	62,000.
Clyde E. Wills	$	30,500.	$	61,000.	$	122,000.

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Item 12. Security Ownership of Certain Beneficial Owners and Management.

     Incorporated by reference to the information under “Beneficial Ownership Table” on pages 13 through 14 of the Proxy Statement.

Item 13. Certain Relationships and Related Transactions.

     Incorporated by reference to the information under “Certain Relationships and Related Transactions” in the Proxy Statement on page 20.

PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K.

(a)      The following documents are filed as part of this report:

     (1)      Financial Statements:

- “Report of Independent Public Accountants” for the three-year period ended December 31, 2001.

- Consolidated Balance Sheets as of December 31, 2001 and 2000.

- Consolidated Statements of Earnings and Retained Earnings for years Ended December 31, 2001, 2000, and 1999.

- Consolidated Statements of Comprehensive Income for years ended December 31, 2001, 2000, and 1999.

- Consolidated Statements of Cash Flows for years ended December 31, 2001, 2000, and 1999.

- Notes to Consolidated Financial Statements.

The foregoing have been incorporated by reference to the Annual Report as indicated under Item 8.

     (2)      Financial Statement Schedules:

Auditors’ Reports on Financial Statement and Schedule II, Valuation and Qualifying Accounts.

All other schedules are omitted because they are not applicable or the information is contained in the consolidated financial statements or notes thereto.

     (3)      Exhibits:

3.1	Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to company’s form 10-Q for the quarter ended, March 31, 1996).
3.2	Bylaws of Butler Manufacturing Company as amended effective November 27, 2001.
3.11	Certificate of Designation of SERIES A, CLASS, 1 PREFERRED STOCK of BUTLER MANUFACTURING COMPANY (Pursuant to Section 151 of the Delaware General Corporation Law), filed September 23, 1999, pursuant to Rights Agreement appended as Exhibit 4.3.

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4.1	Note Agreement between the company and four Insurance Companies dated as of June 1, 1994 (incorporated by reference to Exhibit 4 of the company’s Form 10-Q for the quarter ended June 30, 1994).
4.2	Note Agreement between the company and an Insurance Company dated as of March 1, 1998 (incorporated by reference to Exhibit 4 of the company’s Form 10-Q for the quarter ended March 31, 1998).
4.3	Rights Agreement dated September 16, 1998, between Butler Manufacturing Company and UMB Bank, N.A. which includes the form of Rights as Exhibit C (incorporated by reference to Exhibit 1.1 to the company’s Form 8-A filed September 23, 1999.
10.1	Butler Manufacturing Company Executive Deferred Compensation Plan as amended (incorporated by reference to Exhibit 4 in the company’s Registration statement on Form S-8 filed December 20, 2000 (File No. 333-52338).
10.2	Butler Manufacturing Company Stock Incentive Plan for 1987, as amended (incorporated by reference to Exhibit 10.1 to the company’s Form 10-K for the year ended December 31, 1990).
10.3	Butler Manufacturing Company Stock Incentive Plan of 1979, as amended (incorporated by reference to Exhibit 10.2 to the company’s Form 10-K for the year ended December 31, 1990).
10.4	Form of Change of Control Employment Agreements, as amended, between the company and each of six executive officers (incorporated by reference to Exhibit 10.3 to the company’s Form 10-K for the year ended December 31, 1990).
10.5	Copy of Butler Manufacturing Company Supplemental Benefit Plan as amended and restated (incorporated by reference to Exhibit 10.5 to the company’s Form 10-K for the year ended December 31, 1994).
10.6	Form of Butler Manufacturing Company Split Dollar Life Insurance Agreement (Collateral Assignment Method; Bonus Arrangement) entered into between the company and certain executive officers (incorporated by reference to Exhibit 10.6 to the company’s Form 10-K for the year ended December 31, 1994).
10.7	Form of Butler Manufacturing Company Split Dollar Life Insurance Agreement (Collateral Assignment Method; Roll Out Arrangement) entered into between the company and certain executive officers (incorporated by reference to Exhibit 10.7 to the company’s Form 10-K for the year ended December 31, 1994).

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10.8	Butler Manufacturing Company Stock Incentive Plan of 1996 (incorporated by reference to Exhibit 4(a) to the company’s Registration Statement Number 333-02557 on S-8 filed April 17, 1996).
10.9	Butler Manufacturing Company Director Stock Compensation Program, as amended June 20, 2000 (Incorporated by reference to Exhibit 10.9 to the company’s December 31, 2000 Form 10-K).
10.10	Butler Manufacturing Company Restricted Stock Compensation Program of 1996 (incorporated by reference to the December 31, 1997 Form 10-K).
10.11	Form of Butler Manufacturing Company Split Dollar Life Insurance Agreement (Collateral Assignment Agreement; Roll Out Arrangement) entered into between the company and certain executive officers for the year ended December 31, 2000 (Incorporated by reference to Exhibit 10.11 to the company’s December 31, 2000 Form 10-K).
10.12	Butler Manufacturing Company Director Deferred Fee Plan Dated July 1, 2000. (Incorporated by reference to Exhibit 10.12 to the company’s December 31, 2000 Form 10-K).
10.13	Summary of Butler Manufacturing Company Long Term Incentive Plan.
13.1	Butler Manufacturing Company 2001 Annual Report Pages 14 through 36 only (the information expressly incorporated herein by reference).
18.0	Accountants Preferability Letter dated August 9, 2001 and (incorporated by reference to the company’s June 30, 2001 10-Q).
22.1	Set forth below is a list as of February 20, 2002 of subsidiaries of the company and their respective jurisdictions of incorporation. Subsidiaries not listed, when considered in the aggregate as a single subsidiary, do not constitute a significant subsidiary.

	Jurisdiction of
Subsidiary	Incorporation
Butler Export, Inc.	Barbados
Butler Europe Kft	Hungary
BMC Real Estate, Inc.	Delaware
BUCON, Inc.	Delaware
Butler Pacific, Inc.	Delaware
Butler Real Estate, Inc.	Delaware
Butler, S.A. de C.V.	Mexico
Butler (Shanghai) Inc.	China
Butler Holdings, Inc.	Delaware
Comercial Butler Limitada	Chile
Lester’s of Minnesota, Inc.	Minnesota
Lester Holdings, Inc.	Delaware
Liberty Building Systems, Inc.	Delaware
Moduline Windows, Inc.	Wisconsin

23.1 Consent of Arthur Andersen LLP (incorporated by reference to page 15 of this report).

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24.1	Power of Attorney to sign this and other SEC Reports by each director.
99.1	Audit Assurance Letter from Arthur Andersen LLP.

(b)	The company has not filed any reports on Form 8-K for or during the quarter ended December 31, 2001.
(c)	In accordance with Item 601(b)(4)(iii)(A) of Regulation S-K, certain instruments respecting long-term debt of the Registrant have been omitted but will be furnished to the Commission upon request.

* * * * * *

The calculation of the aggregate market value the company’s Common Stock held by non-affiliates shown on the front of the cover page assumes that directors are affiliates. Such assumption does not reflect a belief by the company or any director that any director is an affiliate of the company.

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SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) 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 on this 25th day of March, 2002.

BUTLER MANUFACTURING COMPANY
BY	/S/ John J. Holland                   John J. Holland       Chairman and CEO

     Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant in the capacities indicated on the dates indicated.

/S/ John J. Holland John J. Holland	Chairman and CEO (Principal Executive Officer)	March 19, 2002
/S/ Ronald E. Rutledge Ronald E. Rutledge	President and Director	March 19, 2002
/S/ Larry C. Miller Larry C. Miller	Vice President-Finance (Principal Financial Officer)	March 25, 2002
/S/ John T. Cole John T. Cole	Controller (Principal Accounting Officer)	March 25, 2002
/S/ K. Dane Brooksher K. Dane Brooksher	Director	March 20, 2002
/S/ Gary M. Christensen Gary M. Christensen	Director	March 20, 2002
/S/ Susan F. Davis Susan F. Davis	Director	March 19, 2002
/S/ C.L. William Haw C.L. William Haw	Director	March 20, 2002
/S/ Robert J. Reintjes, Sr. Robert J. Reintjes, Sr.	Director	March 25, 2002
/S/ Gary L. Tapella Gary L. Tapella	Director	March 19, 2002
/S/ William D. Zollars William D. Zollars	Director	March 19, 2002

15

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the incorporation of our reports dated January 29, 2002, included in or incorporated by reference in this Form 10-K, into the company’s previously filed Registration Statement File Numbers 33-14464, 2-63830, 2-55753, 333-02285, 333-02557, and 333-52338.

/S/ ARTHUR ANDERSEN LLP
      ARTHUR ANDERSEN LLP

Kansas City, Missouri,
March 26, 2002

16

BUTLER MANUFACTURING COMPANY AND SUBSIDIARIES
KANSAS CITY, MISSOURI

Consolidated Financial Statement Schedules
(Form 10-K)

December 31, 2001, 2000, 1999

(With Auditors’ Reports Thereon)

S-1

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Shareholders of Butler Manufacturing Company:

We have audited in accordance with auditing standards generally accepted in the United States, the consolidated financial statements included in Butler Manufacturing Company’s 2001 Annual Report to Shareholders, incorporated by reference in this Form 10-K, and have issued our report thereon dated January 29, 2002. Our audit was made for the purpose of forming an opinion on those statements taken as a whole. The Financial Statement Schedule listed in item 14 is the responsibility of the company’s management and is presented for the purpose of complying with the Securities and Exchange Commission’s rules and is not part of the basic financial statements. This schedule has been subjected to the auditing procedures applied in the audit of the basic consolidated financial statements, and in our opinion, fairly states in all material respects the financial data required to be set forth therein in relation to the basic consolidated financial statements taken as a whole.

/S/ ARTHUR ANDERSEN LLP

      ARTHUR ANDERSEN LLP

Kansas City, Missouri,
January 29, 2002

S-2

SCHEDULE II

BUTLER MANUFACTURING COMPANY AND SUBSIDIARIES

Valuation and Qualifying Accounts

(Thousands of Dollars)

		Balance at		Charged									Balance
		beginning		to						Less:			at end
Description		of year		earnings			Other			Deductions			of year
							(A)
Allowance for Losses on Accounts Receivable:
	2001	$	5,130	$	3,768		$	(196	)	$	1,564		$	7,138
	2000	$	4,674	$	1,620		$	178		$	1,342		$	5,130
	1999	$	3,791	$	2,876		$	(191	)	$	1,802		$	4,674
Restructuring Reserve:
	2001	$	—	$	3,854	(D)	$	—		$	1,749	(E)	$	2,105
	2000	$	885	$	—		$	(620	)	$	265		$	—
	1999	$	2,277	$	1,514	(B)	$	(447	)	$	2,459	(C)	$	885

(A)	Includes reclasses, transfers, and/or recoveries of reserve balances.
(B)	Represents $1.5 million Brazilian foreign currency devaluation reserve established and utilized in the first quarter of 1999.
(C)	Includes charges against the reserve in 1999 of $1.1 million, plus $1.5 million write-down of Brazilian assets due to currency devaluation, net $.2 million 1999 recoveries shown in the Other column.
(D)	Represents the Butler Europe Restructuring Reserve for employee separation costs, costs to close offices, and other related costs to dispose of the business
(E)	Includes the recording of foreign exchange losses due to the write-down of Europe Assets.

S-3

EXHIBIT INDEX

EXHIBITS	DESCRIPTION
3.1	Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to company’s form 10-Q for the quarter ended, March 31, 1996).
3.2	Bylaws of Butler Manufacturing Company as amended effective November 27, 2001.
3.11	Certificate of Designation of SERIES A, CLASS, 1 PREFERRED STOCK of BUTLER MANUFACTURING COMPANY (Pursuant to Section 151 of the Delaware General Corporation Law), filed September 23, 1999, pursuant to Rights Agreement appended as Exhibit 4.3.
4.1	Note Agreement between the company and four Insurance Companies dated as of June 1, 1994 (incorporated by reference to Exhibit 4 of the company’s Form 10-Q for the quarter ended June 30, 1994).
	Note Agreement between the company and an Insurance Company dated as of March 1, 1998 (incorporated by reference to Exhibit 4 of the company’s Form 10-Q for the quarter ended March 31, 1998).
4.3	Rights Agreement dated September 16, 1998, between Butler Manufacturing Company and UMB Bank, N.A. which includes the form of Rights as Exhibit C (incorporated by reference to Exhibit 1.1 to the company’s Form 8-A filed September 23, 1999.
10.1	Butler Manufacturing Company Executive Deferred Compensation Plan as amended (incorporated by reference to Exhibit 4 to the company’s Registration Statement on Form S-8 filed December 20, 2000 (File No 333-52338).
10.2	Butler Manufacturing Company Stock Incentive Plan for 1987, as amended (incorporated by reference to Exhibit 10.1 to the company’s Form 10-K for the year ended December 31, 1990).
10.3	Butler Manufacturing Company Stock Incentive Plan of 1979, as amended (incorporated by reference to Exhibit 10.2 to the company’s Form 10-K for the year ended December 31, 1990).
10.4	Form of Change of Control Employment Agreements, as amended, between the company and each of six executive officers (incorporated by reference to Exhibit 10.3 to the company’s Form 10-K for the year ended December 31, 1990).
10.5	Copy of Butler Manufacturing Company Supplemental Benefit Plan as amended and restated (incorporated by reference to Exhibit 10.5 to the company’s Form 10-K for the year ended December 31, 1994).

10.6	Form of Butler Manufacturing Company Split Dollar Life Insurance Agreement (Collateral Assignment Method; Bonus Arrangement) entered into between the company and certain executive officers (incorporated by reference to Exhibit 10.6 to the company’s Form 10-K for the year ended December 31, 1994).
10.7	Form of Butler Manufacturing Company Split Dollar Life Insurance Agreement (Collateral Assignment Method; Roll Out Arrangement) entered into between the company and certain executive officers (incorporated by reference to Exhibit 10.7 to the company’s Form 10-K for the year ended December 31,1994).
10.8	Butler Manufacturing Company Stock Incentive Plan of 1996 (incorporated by reference to Exhibit 4(a) to the company’s Registration Statement Number 333-02557 on S-8 filed April 17, 1996).
10.9	Butler Manufacturing Company Director Stock Compensation Program as amended June 20, 2000 (incorporated by reference to Exhibit 10.9 to the company’s December 31, 2000 Form 10-K).
10.10	Butler Manufacturing Company Restricted Stock Compensation Program of 1996 (incorporated by reference to Exhibit 10.10 to the company’s December 31, 1997 Form 10-K).
10.11	Form of Butler Manufacturing Company Split Dollar Life Insurance Agreement (Collateral Assignment Agreement; Roll Out Arrangement) entered into between the company and certain executive officers for the year ended December 31, 2000 (incorporated by reference to Exhibit 10.11 to the company’s December 31, 2000 Form 10-K).
10.12	Butler Manufacturing Company Director Deferred Fee Plan Dated July 1, 2000 (incorporated by reference to Exhibit 10.12 to the company’s December 31, 2000 Form 10-K).
10.13	Summary of Butler Manufacturing Company’s Long Term Incentive Plan.
13.1	Butler Manufacturing Company 2001 Annual Report Pages 14 through 36 only (the information expressly incorporated herein by reference).
22.1	Set forth below is a list as of February 20, 2002 of subsidiaries of the company and their respective jurisdictions of incorporation. Subsidiaries not listed, when considered in the aggregate as a single subsidiary, do not constitute a significant subsidiary.

	Jurisdiction of
Subsidiary	Incorporation
Butler Export, Inc.	Barbados
Butler Europe Kft	Hungary
BMC Real Estate, Inc.	Delaware
BUCON, Inc.	Delaware
Butler Pacific, Inc.	Delaware
Butler Real Estate, Inc.	Delaware
Butler, S.A. de C.V.	Mexico
Butler (Shanghai) Inc.	China
Butler Holdings, Inc.	Delaware
Comercial Butler Limitada	Chile
Lester’s of Minnesota, Inc.	Minnesota
Lester Holdings, Inc.	Delaware
Liberty Building Systems, Inc.	Delaware
Moduline Windows, Inc.	Wisconsin

23.1	Consent of Arthur Andersen LLP (incorporated by reference to page 14 of this report).
24.1	Power of Attorney to sign this and other SEC Reports by each director.
99.1	Audit Assurance Letter from Arthur Andersen LLP.

EX-3.2 3 c68481a1ex3-2.htm BYLAWS AS AMENDED

EXHIBIT 3.2

BYLAWS
OF
BUTLER MANUFACTURING COMPANY
(A Delaware Corporation)

Effective November 27, 2001

ARTICLE I

OFFICES

     SECTION 1. Principal Office. The principal office of the Corporation in the State of Delaware shall be in the City of Wilmington, County of New Castle, and the resident agent in charge thereof shall be The Corporation Trust Company.

     SECTION 2. Other Offices. The Corporation may have offices at such other place or places, within or without the State of Delaware, as from time to time the Board of Directors may determine or the business of the Corporation may require.

ARTICLE II
MEETINGS OF STOCKHOLDERS

     SECTION 1. Annual Meetings.

	1.1	Date, Place and Time. The annual meeting of the stockholders shall be held on the third Tuesday in April in each year or on
such other day, which shall not be a legal holiday, as shall be determined by the Board of Directors. The annual meeting shall be held at such place and hour, within or without the State of Delaware, as shall be determined by the Board of Directors. The day, place and hour of each annual meeting shall be specified in the notice of the annual meeting. The meeting may be adjourned by the chairman of the meeting from time to time and place to place. At any adjourned meeting the Corporation may transact any business which might have been transacted at the original meeting. The Board of Directors acting by resolution may postpone and reschedule any previously scheduled annual or special meeting of stockholders.
	1.2	Nomination and Stockholder Business Bylaw.
	(A)	Annual Meetings of Stockholders.
	(1)	Nominations of persons for election to the Board of Directors of the Corporation and the proposal of business to be considered by the stockholders may be made at an annual meeting of stockholders (a) pursuant to the Corporation’s notice of meeting,

1

(b)  by or at the direction of the Board of Directors or (c) by any stockholder of the Corporation who was a stockholder of record at the time of giving of notice provided for in this Bylaw, who is entitled to vote at the meeting and who complied with the notice procedures set forth in this Bylaw.

	(2)	For nominations or other business to be properly brought before an annual meeting by a stockholder pursuant to clause
(c) of paragraph (A)(1) of this Bylaw, the stockholder must have given timely notice thereof in writing to the Secretary of the Corporation. To be timely, a stockholder’s notice shall be delivered to the Secretary at the principal executive offices of the Corporation not later than the close of business on the 90th day nor earlier than the close of business on the 120th day prior to the first anniversary of the preceding year’s annual meeting; provided, however, that in the event that the date of the annual meeting is more than 30 days before or more than 60 days after such anniversary date, notice by the stockholder to be timely must be so delivered not earlier than the close of business on the 120th day prior to such annual meeting and not later than the close of business on the later of the 90th day prior to such annual meeting or the 10th day following the day on which public announcement of the date of such meeting is first made. In no event shall the public announcement of an adjournment of an annual meeting commence a new time period for the giving of a stockholder’s notice as described above. Such stockholder’s notice shall set forth (a) as to each person whom the stockholder proposes to nominate for election or re-election as a director all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and Rule 14 a-11 thereunder (including such person’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected); (b) as to any other business that the stockholder proposes to bring before the meeting, a brief description of the business desired to be brought before the meeting, the reasons for conducting such business at the meeting and any material interest in such business of such stockholder and the beneficial owner, if any, on whose behalf the proposal is made; (c) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made (i) the name and address of such stockholder, as they appear on the Corporation’s books, and of such beneficial owner and (ii) the class and number of shares of the Corporation which are owned beneficially and of record by such stockholder and such beneficial owner.
	(3)	Notwithstanding anything in the second sentence of paragraph (A)(2) of this Bylaw to the contrary, in the event that the
number of directors to be elected to the Board of Directors of the Corporation is increased and there is no public announcement naming all of the nominees for Director or specifying the size of the increased Board of Directors made by the Corporation at least 100 days prior to the first anniversary of the preceding year’s annual meeting, a shareholder’s notice required by this Bylaw shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the Secretary at the principal executive offices of the Corporation not later than the close of business on the 10th day following the day on which such public announcement is first made by the Corporation.

     (B)  Special Meetings of Stockholders. Only such business shall be

2

conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to the Corporation’s notice of meeting. Nominations of persons for election to the Board of Directors may be made at a special meeting of stockholders at which directors are to be elected pursuant to the Corporation’s notice of meeting (a) by or at the direction of the Board of Directors or (b) by any stockholder of the Corporation who is a stockholder of record at the time of giving of notice provided for in this Bylaw, who shall be entitled to vote at the meeting and who complies with the notice procedures set forth in this Bylaw. Nominations by stockholders of persons for election to the Board of Directors may be made at such a special meeting of stockholders if the stockholder’s notice required by paragraph (A)(2) of this Bylaw shall be delivered to the Secretary at the principal executive offices of the Corporation not earlier than the 90th day prior to such special meeting and not later than the close of business on the later of the 70th day prior to such special meeting or the 10th day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such meeting.

     (C)  General. (1) Only such persons who are nominated in accordance with the procedures set forth in this Bylaw shall be eligible to serve as directors and only such business shall be conducted at a meeting of stockholders as shall have been brought before the meeting in accordance with the procedures set forth in this Bylaw. The Chairman of the meeting shall have the power and duty to determine whether a nomination or any business proposed to be brought before the meeting was made in accordance with the procedures set forth in this Bylaw and, if any proposed nomination or business is not in compliance with this Bylaw, to declare that such defective proposal shall be disregarded.

	(2)	For purposes of this Bylaw, “public announcement” shall mean disclosure in a press release reported by the
Dow Jones News Service, Associated Press or comparable national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act.
	(3)	Notwithstanding the foregoing provisions of this Bylaw, a stockholder shall also comply with all applicable requirements of
the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in this Bylaw. Nothing in this Bylaw shall be deemed to affect any rights of stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act.”

     SECTION 2. Quorum. At each meeting of the stockholders, except where other provision is made by law, the holders of a majority of the issued and outstanding stock of the Corporation entitled to vote at such meeting shall constitute a quorum for the transaction of business. In the absence of a quorum the chairman of the meeting shall have the power to adjourn the meeting from time to time, until stockholders holding the requisite amount of stock shall be present or represented. At any such adjourned meeting at which a quorum shall be present, any business may be transacted which might have been transacted at the meeting as originally called.

     SECTION 3. Organization. At each meeting of the stockholders the Chairman of the

3

Board, or if he shall be absent therefrom, the Vice Chairman, or if he shall be absent therefrom, the President, or if he shall be absent therefrom, another officer of the Corporation chosen by the Board of Directors shall act as chairman of the meeting or preside thereat; and the Secretary, or if he shall be absent from such meeting or shall be required pursuant to the provisions of this Section 3 to act as chairman of such meeting, the person (who shall be an Assistant Secretary, if an Assistant Secretary shall be present thereat) whom the chairman of such meeting shall appoint shall act as secretary of such meeting and keep the minutes thereof.

     SECTION 4. Order of Business. The order of business and all other matters of procedure at each meeting of the stockholders shall be determined by the chairman of such meeting.

     SECTION 5. Voting. Each stockholder entitled to vote shall, at each meeting of the stockholders, be entitled to one vote in person or by proxy for each share of voting stock of the Corporation held by him and registered in his name on the books of the Corporation on the date fixed pursuant to the provisions of Section 6 of Article VII of these Bylaws at the record date for the determination of stockholders who shall be entitled to notice of and to vote at such meeting. Any vote on stock of the Corporation may be given at any meeting of the stockholders by the stockholder entitled thereto in person or by his proxy appointed by an instrument in writing executed by such stockholder or by his attorney thereunto authorized or appointed by means of an electronic transmission and delivered to the Secretary of the Corporation or to the secretary of the meeting, provided, however, that no proxy shall be voted or acted upon after three (3) years from its date, unless said proxy shall provide for a longer period. At all meetings of the stockholders all matters, except where other provision is made by law, by the Certificate of Incorporation of the Corporation or by these Bylaws, shall be decided by the vote of a majority in voting interest of the stockholders present in person or by proxy and entitled to vote thereat, a quorum being present. Unless demanded by a stockholder of the Corporation present in person or by proxy at any meeting of the stockholders and entitled to vote thereat or so directed by the chairman of the meeting, the vote thereat on any question need not be by ballot. Upon a demand of any such stockholder for a vote by ballot on any question or at the direction of such chairman that a vote by ballot be taken on any question, such vote shall be taken. On a vote by ballot each ballot shall be signed by the stockholder voting, or by his proxy, if there be such proxy, and shall state the number of shares voted.

     SECTION 6. List of Stockholders. It shall be the duty of the Secretary or other officer of the Corporation who shall have charge of its stock ledger, either directly or through another officer of the Corporation designated by him or through a transfer agent appointed by the Board of Directors, to prepare and make, at least ten (10) days before every meeting of the stockholders, a complete list of the stockholders entitled to vote thereat, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such a list shall be open to the examination of any stockholder, for any purpose germane to the meeting during ordinary business hours, for a period of at least ten (10) days prior to said meeting, either at a place within the city where said meeting is to be held, which place shall be specified in the notice of said meeting, or, if not so specified, at the place where said meeting is to be held. The list shall also be produced and

4

kept at the time and place of said meeting during the whole time thereof, and may be inspected by any stockholder who shall be present thereat.

     SECTION 7. Inspectors of Votes. At each meeting of the stockholders the chairman of such meeting may appoint two Inspectors of Votes to act thereat. Each Inspector of Votes so appointed shall first subscribe an oath or affirmation faithfully to execute the duties of an Inspector of Votes at such meeting with strict impartiality and according to the best of his ability. Such Inspector of Votes, if any, shall take charge of the ballots at such meeting and after the balloting thereat on any question shall count the ballots cast thereon and shall make a report in writing to the secretary of such meeting of the results thereof. An Inspector of Votes need not be a stockholder of the Corporation, and any officer of the Corporation may be an Inspector of Votes on any question other than a vote for or against his election to any position with the Corporation or on any other question in which he may be directly interested.

ARTICLE III
BOARD OF DIRECTORS

     SECTION 1. General Powers. The property, business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors.

     SECTION 2. Number, Election and Terms of Directors. The number of Directors of the Corporation shall be fixed from time to time by the Board of Directors, but shall not be less than three. Such Directors shall be classified with respect to the time for which they severally hold office into three classes. The three classes shall be designated Class A, Class B and Class C. Each class shall be as nearly equal in number as possible, as shall be determined by the Board of Directors. The Class A Directors shall be elected initially for a term expiring at the annual meeting of the stockholders to be held in 1987, the Class B Directors shall be elected initially for a term expiring at the annual meeting of stockholders to be held in 1988, and the Class C Directors shall be elected initially for a term expiring at the annual meeting of stockholders to be held in 1989, with the members of each class to hold office until their successors are elected and qualified. At each annual meeting of the stockholders of the Corporation, the successors to the class of Directors whose term expires at the meeting shall be elected to hold office for a term expiring at the annual meeting of stockholders held in the third year following the year of their election, and until their successors shall have been elected and qualified. Elections of Directors need not be by written ballot.

     SECTION 3. Meetings. All meetings of the Board of Directors of this Corporation may be held within or without the State of Delaware as may be provided in the resolution or notice calling such meeting. The regular annual meeting of the Board of Directors shall be held with or without special notice immediately after the final adjournment of and at the same place as each annual meeting of the shareholders. Other regular meetings of the Board of Directors shall be held with or without notice at such times and places as may be provided by the Board of Directors. Special meetings of the Board may be held at any time upon the call of any member of the Board. Written notice of all special meetings of the Board of Directors shall be given to each director, which notice shall state the time and place of such meeting, and shall be mailed to each director, addressed to him at his residence or usual place of business, at least

5

two (2) days before the day on which such meeting is to be held, or shall be sent addressed to him at such place by telegraph, cable, wireless or by other means of electronic transmission or be delivered personally or by telephone or by other means of electronic transmission not later than the day before the day on which such meeting is to be held. Attendance of a director at any meeting, whether regular or special, shall constitute a waiver of notice of such meeting except where a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened; and any director may waive notice, whether he attends a meeting or not, and such waiver may be in writing, by telegram, or other means of electronic transmission.

     SECTION 4. Quorum and Manner of Acting. One half of the total number of directors shall be required to constitute a quorum for the transaction of business at any meeting, and the act of a majority of the directors present at any meeting at which a quorum shall be present shall be the act of the Board of Directors. In the absence of a quorum, a majority of the directors present may adjourn any meeting from time to time until a quorum be had. Notice of any adjourned meeting need not be given.

     SECTION 5. Action by Consent. Unless otherwise restricted by these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors may be taken without a meeting if all members of the Board of Directors consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board of Directors.

     SECTION 6. Newly Created Directorships and Vacancies. Newly created directorships resulting from any increase in the number of Directors and any vacancies on the Board of Directors resulting from death, resignation, disqualification, removal or other cause shall be filled solely by the affirmative vote of a majority of the remaining Directors then in office, even though less than a quorum of the Board of Directors. Any Director elected in accordance with the preceding sentence shall hold office for the remainder of the full term of the class of Directors in which the new directorship was created or the vacancy occurred and until such director’s successor shall have been elected and qualified. No decrease in the number of Directors constituting the Board of Directors shall shorten the term of any incumbent Director.

     SECTION 7. Participation. Members of the Board or of any committee designated by the Board may participate in a meeting of the Board or such committee by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other. Participation in a meeting pursuant to this Section constitutes presence in person at the meeting.

ARTICLE IV
COMMITTEES

     SECTION 1. Executive and Other Committees. The Board of Directors may, by resolution or resolutions passed by a majority of the whole Board, designate an Executive Committee and one or more other committees, each to consist of two (2) or more of the directors of the Corporation. The Executive Committee shall not have authority to make, alter

6

or amend the Bylaws, but shall exercise all other powers of the Board of Directors between the meetings of said Board, except the power to fill vacancies in their own membership, which vacancies shall be filled by the Board of Directors. The Executive Committee and such other committees shall meet at stated times or on notice to all by any of their own number. They shall fix their own rules of procedure. Two (2) members of any Committee shall constitute a quorum and the act of a majority of the members present at any meeting at which a quorum is present shall be the act of the Committee. The Executive Committee and such other committees shall keep regular minutes of their proceedings and report the same to the Board of Directors. Such other committees shall have and may exercise the powers of the Board of Directors to the extent provided in such resolution or resolutions. Any action required or permitted to be taken at any meeting of the Executive Committee or any other committee of the Board of Directors may be taken without a meeting if all members of such committee consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of such committee.

     SECTION 2. Appointment of Substitute Committee Members. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member.

ARTICLE V
OFFICERS

     SECTION 1. Number. The officers of the Corporation shall be elected by the Board of Directors and shall be a Chairman of the Board, a President, one or more Vice Presidents (one or more of whom may be designated Executive Vice President or Senior Vice President), a Secretary, a Treasurer, and such other Officers (including a Vice Chairman) as may be designated and elected by the Board of Directors.

     SECTION 2. Executives. The Board of Directors may authorize the Chairman of the Board or the President to confer such titles on corporate and divisional executives as the Chairman or President deems appropriate. Persons holding titles conferred by the Chairman or President shall not be officers of the Company, but shall be deemed assistants to the officers, and shall have only such authority as may be specified by these Bylaws, by resolution of the Board of Directors, or as may be properly delegated by or through the Chairman or President. Such persons shall hold such titles at the pleasure of the Chairman or President.

     SECTION 3. Qualifications. The Chairman of the Board, Vice Chairman, if any, and the President shall be members of the Board of Directors.

     SECTION 4. Term. Each officer shall hold his office at the pleasure of the Board of Directors from the date of his election until his successor is elected and qualified, or until his earlier resignation or removal.

     SECTION 5. Consolidation of Offices. Any two (2) or more offices, except those of

7

President and Vice President, may be held by one and the same person.

     SECTION 6. Removal. Any officer may be removed, either with or without cause, by a vote of a majority of the whole Board of Directors.

     SECTION 7. Vacancies. A vacancy in any office because of death, resignation, removal or any other cause shall be filled by the affirmative vote of a majority of the whole Board of Directors.

     SECTION 8. Chairman of the Board. The Chairman of the Board shall be the chief executive officer of the Corporation and, under the direction of the Board of Directors, shall be responsible for the general management and direction of the affairs and business of the Corporation. He shall perform such other duties as may be assigned by the Board of Directors and these Bylaws and shall have all powers necessary and proper to perform such responsibilities and duties. He shall preside at all meetings of stockholders and the Board of Directors.

     SECTION 9. Vice Chairman. The Vice Chairman shall perform all of the duties of the Chairman of the Board in the event of the death, disability or absence of the Chairman of the Board, and such other duties as the Board of Directors may from time to time assign to him.

     SECTION 10. President. The President shall perform such duties as shall be delegated or assigned by the Chairman of the Board, the Board of Directors, or these Bylaws. In the absence of the Chairman of the Board or the Vice Chairman, if any, the President shall preside at meetings of the stockholders and the Board of Directors.

     SECTION 11. Vice Presidents. The Vice Presidents shall perform all of the duties of the President in the event of the death, disability or absence of the President and such other duties, if any, as the Board of Directors may from time to time assign to them.

     SECTION 12. The Secretary and the Assistant Secretaries. The Secretary shall record or cause to be recorded in books provided for the purpose the minutes of the meetings of the stockholders, the Board of Directors, the Executive Committee and all other committees of the Board of Directors, if any; shall see that all notices are duly given in accordance with the provisions of these Bylaws and as required by law; shall be custodian of all corporate records (other than financial) and of the seal of the Corporation and see that the seal is affixed to all documents the execution of which on behalf of the Corporation under its seal is duly authorized in accordance with the provisions of these Bylaws; shall keep the list of stockholders which shall include the post-office address of each stockholder, and make all proper changes therein, retaining and filing his authority for all such entries; shall see that the books, reports, statements, certificates and all other documents and records required by law are properly kept and filed; and, in general, shall perform all duties incident to the office of Secretary and such other duties as may, from time to time, be assigned to him by the Board of Directors or by the President.

At the request of the Secretary, or in his absence or disability, any Assistant Secretary shall

8

perform any of the duties of the Secretary and when so acting, shall have all the powers of, and be subject to all the restrictions upon, the Secretary. Except where by law the signature of the Secretary is required, each of the Assistant Secretaries shall possess the same power as the Secretary to sign certificates, contracts, obligations and other instruments of the Corporation, and affix the seal of the Corporation to such instrument, and attest the same.

     SECTION 13. The Treasurer and the Assistant Treasurers. The Treasurer shall have charge and custody of, and be responsible for, all funds and securities of the Corporation, and shall deposit all such funds in the name of the Corporation in such banks, trust companies or other depositories as shall be selected in accordance with the provisions of these Bylaws; shall render to the Board of Directors, whenever the Board may require him so to do, and shall present at the annual meeting of the stockholders, if called upon so to do, a report of all his transactions as Treasurer; and, in general, shall perform all duties incident to the office of Treasurer and such other duties as may, from time to time, be assigned to him by the Board of Directors or by the President. If required by the Board of Directors, the Treasurer shall give a bond for the faithful discharge of his duties in such sum and with such surety or sureties as the Board of Directors shall determine.

At the request of the Treasurer, or in his absence or disability, any Assistant Treasurer may perform any and all of the duties of the Treasurer and, when so acting, shall have all the powers of, and be subject to all the restrictions upon, the Treasurer. Except where by law the signature of the Treasurer is required, each of the Assistant Treasurers shall possess the same power as the Treasurer to sign all certificates, contracts, obligations and other instruments of the Corporation.

     SECTION 14. Compensation. The compensation of Directors who are employees shall be established by the Board of Directors upon recommendation of the Compensation and Benefits Committee. Compensation of other Officers and Employees shall be established by the President or his delegate.

No officer shall be prevented from receiving such compensation by reason of the fact that he is also a Director of the Corporation.

ARTICLE VI
CONTRACTS, CHECKS, LOANS AND DEPOSITS

     SECTION 1. Contracts, Checks, Etc. All contracts and agreements authorized by the Board of Directors, and all checks, drafts, bills of exchange or other orders for the payment of money, notes, or other evidences of indebtedness issued in the name of the Corporation, shall be signed by such person or persons as may from time to time be designated by the Board of Directors, or as may be designated by such officer or officers as the Board of Directors may appoint, which designation or designations may be general or confined to specific instances. The Board of Directors may authorize the use of facsimile signatures on any such document. [Amended 9/18/90]

     SECTION 2. Proxies in Respect of Securities of Other Corporations. Unless

9

otherwise provided by resolution adopted by the Board of Directors, the Chairman of the Board, President or a Vice President may from time to time appoint an attorney or attorneys, or an agent or agents, to exercise in the name and on behalf of the Corporation the powers and rights which the Corporation may have as the holder of stock or other securities in any other corporation to vote or to consent in respect of such stock or other securities; the Chairman of the Board, the President or a Vice President may instruct the person or persons so appointed as to the manner of exercising such powers and rights and the Chairman of the Board, the President or a Vice President may execute or cause to be executed in the name and on behalf of the Corporation and under its corporate seal, or otherwise, all such written proxies, powers of attorney, or other written instruments as he may deem necessary in order that the Corporation may exercise such powers and rights.

ARTICLE VII
CERTIFICATES OF STOCK, BONDS AND RECORDS

     SECTION 1. Form, Signatures. The certificates of stock of the Corporation shall be numbered and shall be entered in the books of the Corporation as they are issued. They shall exhibit the holder’s name and number of shares and shall be signed by the Chairman of the Board or President or a Vice President and the Secretary or an Assistant Secretary which signature may be a facsimile; provided, however, that if any such certificate is countersigned (a) by a transfer agent other than the Corporation or its employee or (b) by a registrar other than the Corporation or its employee, any other signature on such certificate may be a facsimile. In case any officer of the Corporation who shall have signed, or whose facsimile signature shall have been placed upon, such certificate shall cease to be such officer before such certificate shall have been issued, such certificate may nevertheless be issued by the Corporation with the same effect as though such person were such officer at the date of issuance.

     SECTION 2. Transfer. Transfers of stock shall be made on the books of the Corporation only by the person named in the certificate or by attorney lawfully constituted in writing, and upon surrender of the certificate therefor.

     SECTION 3. Record Owner. The Corporation shall be entitled to treat the holder of record of any share or shares of stock as the holder in fact thereof and accordingly shall not be bound to recognize any equitable or other claim to or interest in such share on the part of any other person, whether or not it shall have express or other notice thereof, save as expressly provided by the laws of Delaware.

     SECTION 4. Lost Certificates. In the case any certificates of stock issued by the Corporation shall be alleged to have been lost, stolen or destroyed the Transfer Agent is authorized to issue and authenticate any certificate or certificates of stock issued in lieu of a lost, stolen or destroyed certificate or certificates of stock, and in an appropriate case to transfer shares represented by certificates of stock registered in the name of a decedent without requiring documents as to probate proceedings provided that an Indemnity Bond satisfactory to the Transfer Agent indemnifying the Corporation and the Transfer Agent shall be required in all cases.

10

     SECTION 5. Books and Records. The books and records of the Corporation may be kept at such places within or without the State of Delaware as the Board of Directors may from time to time determine.

     SECTION 6. Fixing Date for Determination of Stockholders of Record. In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any other change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix, in advance, a record date, which shall not be more than sixty (60) days nor less than ten (10) days before the date of such meeting, nor more than sixty (60) days prior to any other action. If in any case involving the determination of stockholders for any purpose other than notice of or voting at a meeting of stockholders the Board of Directors shall not fix such a record date, the record date for determining stockholders for such purpose shall be the close of business on the day on which the Board of Directors shall adopt the resolution relating thereto. A determination of stockholders entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.

ARTICLE VIII
DIVIDENDS

Subject to the provisions of law and of the Certificate of Incorporation, the Board of Directors, at any regular or special meeting, may declare and pay dividends upon the shares of its stock either (a) out of its surplus as defined in and computed in accordance with the provisions of law or (b) in case it shall not have any such surplus, out of its net profits for the fiscal year in which the dividend is declared and/or the preceding fiscal year, whenever and in such amount as, in the opinion of the Board of Directors, the condition of the affairs of the Corporation shall render it advisable.

Before payment of any dividend or making any distribution of profits, there may be set aside out of the surplus or net profits of the Corporation such sum or sums as the Directors from time to time, in their absolute discretion, think proper as a reserve fund to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the Corporation, or for such other purpose as the Directors shall think conducive to the interests of the Corporation.

11

ARTICLE IX
SEAL

The corporate seal of the Corporation shall be circular in form and shall contain the following words:

BUTLER MANUFACTURING COMPANY
CORPORATE
SEAL
DELAWARE

ARTICLE X

FISCAL YEAR

The fiscal year of the Corporation shall end on the thirty-first day of December in each year.

ARTICLE XI
AMENDMENTS

Subject to the provisions of the Certificate of Incorporation, these Bylaws may be altered, amended or repealed at any regular annual meeting of the stockholders (or at any special meeting thereof duly called for that purpose) by a majority vote of the shares represented and entitled to vote at such meeting; provided that in the notice of such special meeting notice of such purpose shall be given. Subject to the laws of the State of Delaware, the Certificate of Incorporation and these Bylaws, the Board of Directors may by majority vote of those present at any meeting at which a quorum is present amend these Bylaws, or enact such other Bylaws as in their judgment may be advisable for the regulation of the conduct of the affairs of the Corporation.

12 EX-10.13 4 c68481a1ex10-13.htm SUMMARY OF LONG TERM INCENTIVE PLAN

Exhibit 10.13

Summary of Butler Manufacturing Long Term Incentive Plan

     The Long Term Incentive Plan (“LTIP” or “Plan”) is an additional component in our executive compensation package. It is designed to reward efforts for good financial results while enhancing the ability to earn long-term rewards. The objective of this Plan is to improve overall results, to balance short-term and long-term goals, tie pay to performance, pay competitively, and focus the senior management team on creating shareholder value.

     The LTIP is a long-term incentive plan. It is designed to reward with both stock ownership and cash to executives whose leadership create value and generate returns for shareholders. The Plan contemplates:

• Annual stock option grants;

• A performance measurement based on total business return; and

• Three year performance period.

     Corporate Officers and Division Presidents are eligible to participate in the Plan. Participants who become eligible during a performance cycle will receive a prorated share of the awards.

PLAN COMPONENTS

     The LTIP has two components, annual stock option grants and a Long Term Cash Performance Plan (LTCPP).

     Annual Stock Option Grants

     Subject to stockholder approval of our 2002 Stock Incentive Plan at our annual meeting being held in April 2002, the Plan contemplates annual grants of stock options in order to promote stock ownership by executives. All stock option grants are subject to Board discretion and approval. Stock options will have a 10-year term.

     Long Term Cash Performance Plan (“LTCPP”)

     The goal of the LTCPP is to reward executives for value creation with Butler. We chose “total business return” on company wide results to be our method of measuring value creation. Total business return is a function of three variables: investment, NOPAT (net operating profit after tax), and the cost of capital. We calculate total business return by (i) dividing changes in net operating profit after taxes by the weighted average cost of capital (ii) adding free cash flow for the three year period and (iii) dividing the result by beginning investment levels. As a benchmark, our total business return for the three years ended December 31, 2000 was 32%.

     The LTCPP contemplates three year performance cycles, each cycle commencing at the beginning of each year, the first of which began on January 1, 2001. At the beginning of each cycle, the Board’s Compensation Committee will establish threshold, target and maximum total business return performance standards upon which awards will be based and the dollar amount of the award to be paid at the target level for each executive officer participating in the LTCPP. At the end of each three year performance period, actual awards will be determined as a percentage of the target awards, based on Butler’s

1

three year total business return. Awards will be paid in cash, subject to withholding, and we expect executives to use one third of any award to purchase Company stock.

     If a participant’s employment ends due to:

• Death, retirement, permanent disability — The executive and his or her beneficiary may be paid the portion of the LTCPP award covering the time of the performance period that he or she was actively employed, at the discretion of the Board Compensation and Benefits Committee.

• Termination (voluntary or involuntary) — The executive forfeits any unpaid LTCPP award amounts.

2 EX-24.1 5 c68481a1ex24-1.htm POWER OF ATTORNEY

EXHIBIT 24.1

POWER OF ATTORNEY

     KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned hereby constitutes and appoints John W. Huey, his true and lawful attorneys-in-fact and agents, with full power of substitution and revocation in each, for him/her and in his/her name, place and stead, to sign any or all reports (including reports on Form 10-K, Form 3, Form 4, Form 5, Schedule 13-D, Schedule 13-G, and Form 144), and any amendments thereto, required or permitted to be filed by him under the Securities and Exchange Act of 1934, or the Securities Act of 1933, with respect to beneficial ownership of, and transactions in, equity securities of BUTLER MANUFACTURING COMPANY, a Delaware corporation (the “company”), and with respect to other matters relating to the company, and to file the same, with all documents required or permitted to be filed in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

DATED:	January 14, 2002	/S/ K. DANE BROOKSHER K.DANE BROOKSHER
DATED:	January 10, 2002	/S/ GARY M. CHRISTENSEN GARY M. CHRISTENSEN
DATED:	January 10, 2002	/S/ SUSAN F. DAVIS SUSAN F.DAVIS
DATED:	January 9, 2002	/S. C.L. WILLIAM HAW C.L. WILLIAM HAW
DATED:	January 9, 2002	/S/ JOHN J. HOLLAND JOHN J. HOLLAND
DATED:	January 11, 2002	/S/ ROBERT J. REINTJES, SR. ROBERT J. REINTJES, SR.
DATED:	January 8, 2002	/S/ RONALD E.RUTLEDGE RONALD E.RUTLEDGE
DATED:	January 10, 2002	/S/ GARY L. TAPELLA GARY L. TAPELLA
DATED:	January 9, 2002	/S/ WILLIAM D. ZOLLARS WILLIAM D. ZOLLARS

EX-99.1 6 c68481a1ex99-1.htm AUDIT ASSURANCE LETTER FROM ARTHUR ANDERSEN LLP

EXHIBIT 99.1

AUDITORS ASSURANCE LETTER

To The Board of Directors and Stockholders of Butler Manufacturing Company

Ladies and Gentlemen:

We represent that this audit was subject to our quality control system for the U.S. accounting and auditing practice to provide reasonable assurance that the engagement was conducted in compliance with professional standards, that there was appropriate continuity of Arthur Andersen personnel working on the audit and availability of national office consultation, and availability of personnel at foreign affiliates of Arthur Andersen to conduct the relevant portions of the audit.

/S/ ARTHUR ANDERSEN LLP
ARTHUR ANDERSEN LLP

Kansas City, Missouri,
March 26, 2002

EX-13 7 butler2001c.htm

Management’s Discussion and Analysis of
Financial Condition and Results of Operations

Results of Operations

Butler Manufacturing Company supplies products and services for nonresidential construction markets. These markets are cyclical in nature. One consequence of cyclicality is demand for the company’s products generally increases and decreases at a rate greater than the movement of the general economy. Most of the world’s economies entered into recession in 2001, and nonresidential construction demand declined as expected. Butler Manufacturing Company’s 2001 financial results reflect the global recession.

Chart: Sales By Segment (in millions)

	2001	2000	1999
North American Building Systems	$440	$530	$546
International Building systems	$82	$86	$84
Architectural Products	$232	$224	$202
Construction	$133	$149	$152
Real Estate	$38	$8	$27

Chart: Pretax Earnings By Segment (in millions)

	2001	2000	1999
North American Building Systems	$10.4	$31.7	$18.3
International Building systems	$(6.1)	$4.1	$4.2
Architectural Products	$13.8	$16.4	$19.3
Construction	$3.2	$2.5	$2.2
Real Estate	$6.0	$2.6	$4.1

2001 Compared to 2000

The company’s sales were $897 million in 2001, down $63 million or 6.6%, from the prior year. The majority of the decline occurred in the North American Building Systems segment where sales were $440 million in 2001, a decline of $90 million or 17%. Sales in the domestic nonresidential Butler® buildings and Lester® buildings businesses were both lower than the prior year. Lower sales in these businesses were the direct result of fewer opportunities in the important commercial and manufacturing sectors. Construction buying decisions were delayed or shelved, as the global economy entered a more severe decline in the latter half of the year, accelerated by the terrorist attack of September 11. Weather conditions early in the year, especially in the northern half of the U.S., slowed construction activity and contributed to the decline in annual sales. However, the Liberty® metal buildings business, whose lower priced product offering was introduced in the latter part of 2000, reported increased revenues in 2001 as this business completed its first full year of operations.
      The International Building Systems segment sales were $82 million in 2001 compared with $86 million in 2000, a decline of 5.3% from the prior year. Increases in revenues from the China metal buildings business were not enough to offset the decline experienced in the European metal buildings business.
      Sales in the Architectural Products segment increased 3.3% in 2001 to $232 million compared with $224 million a year ago. The additional capacity from the opening of a new extruding and finishing facility in Tennessee contributed to the sales growth of this business. However, sales in the Architectural Products segment slowed in the latter part of the year as the commercial construction market demand declined.
      The Construction Services segment reported sales of $133 million in 2001 compared with $149 million, a decline of 11%. Lower comparative sales during the first half of the year, and a shift in focus to more material-erect projects, which produce less sales volume on a per project basis, and a more selective pursuit of turnkey construction projects, contributed to the decline. Construction Services experienced an increase in comparative sales in the latter half of the year due to increased volume from relationship accounts with multiple-location project opportunities, and a large governmental project, which required repetitive standard structures on a fast-track implementation schedule.
      Real Estate segment sales in 2001 were $38 million, an increase of $30 million over the prior year. The increase in sales was due to a record backlog of completed projects available for sale at the beginning of 2001 vs. 2000. Butler Real Estate’s revenue stream is more erratic than that of the company’s manufacturing operations due to the project nature of the business.
      Gross profit in 2001 was $137 million, or 15.3% of sales compared with $169 million, or 17.6% of sales in 2000. Gross profit by segment is presented below.

	2001		Change			Gross Profit as
	Gross		from			a % of sales
Dollars in millions	Profit		2000			2001	2000
North American Building Systems	$	69	$	(30	)	15.7	18.7
International Building Systems		13		(2	)	15.9	17.0
Architectural Products		40		(1	)	17.2	18.3
Construction Services		13		–		9.4	8.2
Real Estate		2		1		6.0	15.6
Total	$	137	$	(32	)	15.3	17.6

     Gross profit as a percent of sales in the North American Building Systems segment was 15.7% in 2001 compared with 18.7% in 2000. Declining sales opportunities in the nonresidential construction market caused by the economic downturn lowered this segment’s manufacturing productivity and gross profit margins during the year. The U.S. metal buildings business took one plant offline during the latter part of the year to better balance its capacity with market demand. Competitive conditions throughout the year reduced product selling prices, lowering gross profit margins as well.
      International Building Systems segment gross profit percentage was 15.9% in 2001 compared with 17% in 2000. The gross profit percentage declined modestly in the China business and more severely in the European business, primarily due to the impacts of competitive pricing generally and recession in Europe specifically.
      Gross profit as a percent of sales in the Architectural Products segment was 17.2% in 2001 compared with 18.3% in the prior year. Start-up costs associated with the new Tennessee plant, previously as out-sourced production was transitioned in-house during the year,

Page 14

and the slowing commercial construction market in the latter half of the year were the primary contributors to the decline.
      The Construction Services segment’s gross profit percentage increased to 9.4% in 2001 from 8.2% in the prior year. A shift in focus to material-erect projects, a more selective pursuit of turnkey projects, good project execution, and better margins on the multi-site program mentioned previously were the primary causes for the improvement.
      The Real Estate segment’s gross profit percentage declined to 6% in 2001 from a historically high rate of 15.6% in the prior year. Gross margins on project sales in 2001 reflected a more typical rate for the merchant developer market niche in which Butler Real Estate operates.
      The company’s sales, general, and administrative expense was $115 million in 2001 compared with $124 million in 2000, a 7.4% decrease from the prior year. The decrease was primarily accomplished in the Building Systems and Construction Services segments, driven by volume decreases as well as reductions from a number of continuous improvement, organizational change, and cost control initiatives. Selling, general, and administrative expenses increased in the International Building Systems and Architectural Products segments due to expenditures to fund growth initiatives in both segments, including costs associated with new plant capacity and an expanded sales presence in China.
      During the fourth quarter the company recorded pretax charges of $4.3 million for asset impairment and $3.9 million for restructuring, related to the decision to sell certain assets and dispose of other assets related to its European metal building operation. The after-tax impact of the charges was $3.6 million, or $.58 per share. A letter of intent has been signed and the sale is expected to close by the end of the first quarter of 2002. Excluding these special charges, the operating loss for the company’s European operations was $3.3 million during 2001. The European business is included in the International Building Systems segment.
      Operating income for 2001 was $14.3 million as compared with $45.2 million in 2000.
      Other income was $.9 million for the year compared with expense of $1.6 million in the prior year. The primary reason for the favorable increase was due to higher rental income in the company’s Real Estate segment. Butler Real Estate entered 2001 with a record backlog of completed projects. It generates rental income from tenants occupying completed real estate developments while the facilities are being marketed for sale to third party investors.
      Interest expense totaled $6.9 million in 2001 compared with $5.2 million the prior year. The increase was primarily due to interest expense related to the new $50 million private placement notes issued by the company to a group of insurance companies in June 2001.
      Pretax earnings for 2001 were $16.4 million before, and $8.3 million after asset impairment and restructuring charges associated with the company’s European business. The company realized a $4.5 million tax benefit associated with the pending sale of the European business.
      The company’s effective tax rate was 2.4% in 2001. This rate includes a $4.5 million benefit associated with the sale of the European business. Excluding this benefit and the related special charges, the effective rate would have been 28.7% as compared with 34.3% in the prior year. A partial tax holiday for the company’s China subsidiary, favorable settlements of tax audits, and the utilization of a capital loss carryforward contributed to the lower effective rate in 2001.
      The after-tax effect of the European special charges decreased net earnings by $3.6 million or $.58 per share. Net earnings were $8.1 million or $1.28 per share in 2001 compared with $25.2 million or $3.86 per share in 2000.

2000 Compared to 1999

The company’s sales decreased $13 million to $960 million in 2000 compared with $973 million in 1999, a net decline of 1%. Three business segments: Real Estate, Northern American Building Systems, and Construction Services, posted lower sales. The Architectural Products and International Building segments reported higher sales as presented in the graphs on page 14.
      The Northern American Building Systems segment reported higher sales. Domestic sales were up modestly; however, significantly lower sales to its Latin American markets more than accounted for the 3% sales decline for this segment during 2000. The International Building segment increased $2 million to $86 million as European sales were up 14% and China sales matched the prior year’s record level. Architectural Products sales increased $22 million, or 11%, due to increased demand for its products and its ability to provide a high level of service to this market. Construction Services sales declined $3 million in 2000 as we began to transition this business to pursue more value-added work. Real Estate sales declined $20 million due to the timing of its project sales.
      Gross profit in 2000 was $169 million, or 17.6% of sales compared to $172 million, or 17.7% of sales in 1999. Gross profit by segment is presented below.

	2000		Change			Gross Profit as
	Gross		from			a % of sales
Dollars in millions	Profit		1999			2000	1999
North American Building Systems	$	99	$	1		18.7	18.1
International Building Systems		15		(1	)	17.0	19.4
Architectural Products		41		(1	)	18.3	20.9
Construction Services		13		–		8.2	8.2
Real Estate		1		(2	)	15.6	12.8
Total	$	169	$	(3	)	17.6	17.7

     Gross profit in the North American Building Systems segment in 2000 improved as compared with the prior year. The International Building Systems gross profit rate declined 2.4% to 17.0% as the European business transitioned its manufacturing operations from Scotland to Hungary, incurring extra costs for the year. Gross profit in the Architectural Products segment declined in amount and percentage of sales. The business outgrew its manufacturing capacity in 2000, and needed to substantially increase the purchase of third-party extrusions and finishing at a cost premium. A new production facility in Tennessee, to be completed in 2001, is expected to reduce manufacturing costs and provide capacity for continued sales growth.
      Gross profit in the Construction Services segment for 2000 was comparable with the prior year, while the Real Estate segment gross profit declined because of reduced project sales.
      Selling, general, and administrative expenses declined to $124 million, or 12.9% of sales, in 2000 compared with $134 million, or 13.8% of sales, in 1999. The company reduced these costs by combining or eliminating functions while improving its service to customers. Expansions of our lean operating approach and continuous process improvements also helped reduce these costs. In addition, the 1999 selling, general, and administrative expenses included a $4.3 million write-down of a software project.
      In 2000 the company recorded income of $.4 million from a reversal of unutilized restructuring charges associated with the 1998

Page 15

Management’s Discussion and Analysis of
Financial Condition and Results of Operations

restructuring of the company’s Brazilian and European businesses. In 1999 the company recorded charges, net of recoveries, of $1.1 million incident to the restructuring of these businesses.
      In 2000 the company recorded other expense of $1.6 million compared with other income of $.2 million in 1999. Lower interest income on short-term investments and losses on asset dispositions accounted for the difference between the years.
      Operating income increased 24% to $45.2 million in 2000 compared with $36.5 million in 1999.
      Interest expense declined to $5.2 million in 2000 compared with $5.6 million in 1999 due to a lower level of debt and a higher level of interest capitalized as project cost for major facility additions during 2000. The company’s effective tax rate was 34.3% in 2000 and 17.1% in 1999. The effective rate in 2000 benefited from an income tax holiday for the company’s China subsidiary. The lower effective rate in 1999 was the result of the same tax holiday plus a $5.8 million tax benefit realized from the sale of the company’s Scottish subsidiary, Butler Building Systems Ltd.
      Net earnings in 2000 were $25.2 million, or $3.86 per share, as compared to $25.8 million, or $3.63 per share. Net earnings in 1999 benefited from one-time items, which increased net earnings by $2.3 million, or $.33 per share.

Chart: Cash Increased $36 Million During 2001 (in millions)

Sources
Net earnings adjusted for non-cash items	$34
Working Capital, net of noncurrent activities	$11
Real Estate Developments	$29
Net Borrowings Activities	$12
Uses
Capital Expenditures and Other	$46
Dividends and Treasury Stock	$4

Liquidity and Capital Resources

Cash flow by activity for the last three years is summarized below.

Dollars in millions		2001			2000			1999
Net Earnings adjusted for non-cash items		$	34		$	40		$	47
Working Capital, net of noncurrent activities			11			(12	)		30
Real Estate Developments			29			(34	)		–
	Total Operating Activities		74			(6	)		77
Capital Expenditures and Other			(46	)		(39	)		(15	)
Net Borrowings Activities			12			28			(4	)
Dividends and Treasury Stock			(4	)		(19	)		(15	)
Cash Flow		$	36		$	(36	)	$	43

     During 2001 the company increased its cash and cash equivalents by $36 million. The main drivers of this increase were $74 million generated from operations, and $12 million from net borrowing activities. The main use of cash during 2001 was $45 million used for capital investments, and $4 million for dividends.
      The $74 million in operating cash flow was comprised of several components. Net earnings of $8 million plus $26 million of non-cash items charged to earnings, including depreciation and amortization expense, and the European business asset impairment and restructuring charges provided a total of $34 million. Decreases in working capital provided an additional $30 million. Working capital decreased due to lower receivables and inventories caused by both volume declines and improved management of both asset categories in most segments. As a reduction to operating cash flow, other noncurrent operating assets, net of liabilities, increased $19 million due to additions to capitalized software costs, an increase in the long-term component of prepaid expense associated with the company’s pension plans, and premiums paid on cash-surrender-value insurance policies purchased to fund nonqualified plan benefits. Finally, proceeds from the sales of real estate development projects, net of costs incurred for new developments, provided additional operating cash of $29 million in 2001.
      Funds used for investing purposes totaled $46 million in 2001, of which $45 million was used for capital projects compared with $37 million in 2000, including $27 million for the new company and certain division headquarters facility. Other significant property, plant, and equipment investments included the completion of a second extrusion and finishing plant for the Architectural Products business, and an office facility for the company’s operations in China.
      During 2001 the company entered into two credit agreements to support short and long-term financing needs. In June, the company replaced its then existing unsecured $40 million bank credit agreement with a new unsecured $50 million bank credit facility. The new bank facility expires in June 2004. The primary purpose of the bank line is to provide seasonal working capital financing for the company’s domestic operations. It also supports the company’s letter of credit needs. For the year, short-term domestic bank borrowings averaged $20 million over 181 days compared with $13 million over 291 days in 2000. The company also maintained a $3 million bank credit line for its Hungarian metal buildings business, secured by the assets of the business, and a $3 million credit facility for its China operations, secured by certain assets of that business. At December 31, 2001, $44 million was available for borrowings under the above noted facilities.
      Also in June 2001, the company issued $50 million in senior unsecured private placement notes to a group of insurance companies. The notes carry an all-in fixed interest rate of 7.91%. Principal payments of approximately $4.5 million begin in December 2006 and continue each year through the notes’ final maturity in 2016. The note proceeds were used to pay down short-term bank debt and to fund capital projects.
      Based upon the current outlook for the company, management believes the company’s anticipated operating cash flow, complemented by the existing bank credit lines, is sufficient to meet foreseen liquidity requirements.

Page 16

Market Risk

The company’s principal exposures to market risk are changes in commodity prices, interest rates, currency exchange rates, and product pricing. To limit exposure to select risks, the company enters into commodity and currency hedging transactions, and forward purchasing arrangements. The company does not use financial instruments for trading purposes.

Commodity Price Exposure: The primary commodities used in the company’s operations are steel, aluminum, and lumber. Steel is the company’s largest purchased commodity. The company enters into forward steel and wood purchase arrangements in its metal buildings businesses for periods of less than one year’s duration to protect against potential price increases. Increases in the company’s steel costs are generally recaptured in the price of the company’s products. During 2001 the company’s steel costs remained relatively stable.
      Aluminum hedge contracts of less than one year’s duration are purchased to hedge the engineered products backlog of the Vistawall group against potential losses caused by increases in aluminum costs. This product line is more sensitive to material cost movements because of its longer lead times from project quoting to manufacture. Gains or losses on hedge contracts are recorded as cost of sale adjustments when the underlying product sale is recognized.
      Effective January 1, 2001, the company adopted the Statement of Financial Accounting Standards Statement (SFAS) No. 133 “Accounting for Derivative Instruments and Hedging Activities”, as amended. At December 31, 2001, the fair value of open aluminum contracts recorded in its cumulative other comprehensive income was $.2 million, pre tax. Unrealized gains on the company’s Canadian currency exchange contracts were recorded in earnings and were less than $.1 million pretax at December 31, 2001. At December 31, 2001, a 10% change in both aluminum or Canadian currency contracts was immaterial.

Interest Rates: Ninety-four percent of the company’s total debt carries a fixed rate of interest, which limits the company’s exposure to increases in market rates. However, interest rate changes impact the fair market value of such debt. At December 31, 2001, holding all other variables constant, including levels of indebtedness, a one percentage point change in interest rates would result in approximately a $4 million change in the fair market value of the company’s total debt. Principal payments over the next five years on the fixed-rate debt are $23 million, with a weighted-average interest rate of 7.4%. At the end of five years, then outstanding fixed-rate debt of $81 million will carry a weighted-average interest rate of 7.4%. The company’s short-term bank borrowings provide for interest at variable rates. The company does not hedge its interest rate exposure.

Foreign Currency Fluctuation: The majority of the company’s business is conducted in U.S. dollars, limiting the company’s exposure to foreign currency fluctuations. The company’s foreign-based operations use the local currency as their functional currency. The company has both transaction and translation foreign exchange exposure in its foreign markets.
      At December 31, 2001, the company’s net asset investment in foreign operations was $27 million. Due to its relative cost, limited availability, and the company’s long-term investment perspective, the company does not hedge its foreign net asset exposure.
      The company does hedge its short-term foreign currency transaction exposure related to metal building sales activity in Canada. Forward exchange contracts are purchased to cover a portion of the exposure.

Chart: Capital Employed By Segment At Year End (in millions)

	2001	2000	1999
North American Building Systems	$93	$100	$101
International Building systems	$27	$29	$18
Architectural Products	$92	$84	$59
Construction	$(7)	$8	$(1)
Real Estate	$28	$52	$21

New Accounting Pronouncements

Effective January 1, 2001, the company implemented the Financial Accounting Standards Board Statements (SFAS) No’s. 141 “Business Combinations”, 142 “Goodwill and Other Intangible Assets”, and 144 “Accounting for Impairment or Disposal of Long-Lived Assets”. SFAS No. 141 covers accounting for business combinations and eliminates the pooling of interest method of accounting for business acquisitions. The statement requires that all acquisitions be accounted for under the purchase method of accounting. The company has followed this accounting method with prior acquisitions and plans to do so in the future. SFAS No. 142 eliminates future amortization of goodwill, recorded in business combinations, and requires impairment of goodwill and intangible assets be assessed annually, with valuation write-downs, if any, reflected in the financial statements.

Pension Accounting Method Change and Pension Funded Status

Effective January 1, 2001, the company changed its method of accounting for recognizing pension plan asset gains and losses used in determination of net pension expense for its base pension plan. The company changed from the market-value method to a market-related-value method. The new method is widely used and is preferable, because it more accurately matches expense to accounting periods during which the benefits are earned, improving year-to-year comparability of net period costs for this plan. The effect of this accounting change on 2001 net income was an increase of $.4 million or $.07 per share.

     The company’s defined benefit pension plans all experienced negative investment results during 2001, for the second consecutive year, as compared with the plans’ long-term asset return assumption of 8.5%. The two-year asset return shortfall, from the 8.5% rate, reduced pension plan funding by $23 million. In addition, the decline in long-term interest rates during 2001 reduced the discount rate used to compute the present value of the plans’ benefit obligations. The 50 basis point decrease in the long-term benefit obligation discount rate increased the plans’ accumulated benefit obligations by $3 million, at the December 31, 2001 measurement date. The combined result of the above two events caused the accumulated benefit obligations for certain pension plans of the company to exceed their respective plan assets as of December 31, 2001.
      As required by accounting standards, the company recorded an other comprehensive income charge of $6.6 million, net of tax, with a corresponding reduction in shareholders’ equity to recognize this funding shortfall. In addition, the company reclassified its prepaid pension expense of $9 million from a current asset to Investments and other assets. This reclassification reflects the now long-term nature of this operating asset. The company’s accrued pension liability for all pension plans as of December 31, 2001 was $15 million.
      A summary of the $6.6 million after-tax charge to other comprehensive income is presented on page 18.

Page 17

Management’s Discussion and Analysis of
Financial Condition and Results of Operations

Recap of Minimum Pension Liability Recognized at December 31, 2001

	ERISA		Nonqualified
Dollars in thousands	Plans		Plan			Total
Accumulated Benefit Obligation (ABO)	$	41,361	$	2,911		$	44,272
Fair Market Value of plan assets		36,404		–			36,404
ABO in excess of plan assets		4,957		2,911			7,868
Prepaid Pension Expense – plan contributions not   yet recognized in earnings		9,392		–			9,392
Accrued Liability, previously   recognized in earnings		–		(2,335	)		(2,335	)
Minimum Pension Liability recognized		14,349		576			14,925
Intangible Asset recognized –   unamortized prior service cost		4,237		–			4,237
Pretax charge to other comprehensive income		10,112		576			10,688
Income Tax benefit		3,842		219			4,061
Reduction in shareholders’ equity	$	6,270	$	357		$	6,627

Management Judgments and Estimates

In preparing the financial statements, a number of assumptions and estimates are determined, that in the judgment of management, are proper in light of existing general economic and company-specific circumstances. Examples of areas in which judgments and estimates are required include the collectibility of receivables, the value of inventory, the future useful life of long-lived assets, such as plant, equipment, and internally generated software, as well as the value of certain contingent liabilities, including product warranties and claims arising in the ordinary course of business. While the company has taken reasonable care in preparing these estimates and making these judgments, actual results could and probably will differ from the estimates. Management believes that any difference in the actual results from the estimates will not have a material adverse effect upon the company’s financial position or results of operations.

Critical Accounting Policies

The company’s critical accounting polices include its sales recognition for construction contracts, inventory valuation, and estimation of product liability for third-party claims.
      Sales and gross profit recognition for construction contracts are based upon the percentage completion method. This method requires the company to estimate total cost at completion for each in-process construction project. Total contract revenue less total estimated costs generates an estimated gross profit for each contract. Based upon estimated total cost and estimated gross profit, the company recognizes construction sales and gross profit over the life of the project on a percentage completion basis. The percentage complete at each period end date is determined using costs actually incurred as of that date compared to the estimate of total contract costs at completion. Periodic re-evaluations of total cost at completion estimates are made with the resulting cumulative adjustments recognized in the current period financial statements. Actual costs for completed projects can and typically will vary from earlier estimates, with the final adjustment from estimate to actual costs recognized during the period when the project is completed.
      The company has chosen the last-in, first-out (LIFO) accounting method for valuing inventory in the majority of its manufacturing businesses. In periods of rising prices and steady or increasing levels of inventory, the effect of the LIFO method is to charge the current year cost of sales with inventory purchases that reflect current year costs. This method results in a better matching of current costs with current sales during an accounting period. Generally it presents a more conservative valuation of the company’s inventory, and the gross profit and net earnings reported for the period. The LIFO valuation is a year-end measurement process requiring estimates for the determination of quarterly gross profit and quarter end inventory valuation. At December 31, 2001, the cumulative effect of choosing the LIFO method was a reduction in inventory values of $8.5 million. During 2001, the company reduced inventory levels, which had the effect of charging the current year cost of sales with prior years’ costs. For 2001, the effect of reducing inventory levels increased net earnings by $.3 million, or $ .05 per share.
      The company is subject to third-party claims associated with its products and services. The time period from when a claim is asserted to when it is resolved either by dismissal, negotiation, settlement, or litigation can be several years. While the company maintains product liability insurance, its arrangements include significant self-retention of risk in the form of policy deductibles. In addition, certain claims are not insured. Actual claim settlement costs and litigation awards can and probably will vary from the estimates made by the company. Management believes that any difference in the actual results from the estimates will not have a material adverse effect upon the company’s financial position or results of operations.

Management Transition and Director Retirements

At the end of 2001 Mr. Donald H. Pratt retired as Chairman of the Board after 36 years of service. In November 2001, Mr. John J. Holland was named Chairman of the Board and Chief Executive Office (CEO) of the company. Mr. Holland joined the company in 1980 and has served for 22 years, most recently as President and CEO. Also in November 2001, Mr. Ronald E. Rutledge was elected President and Chief Operating Officer of the company; he also was elected as a Director to the company’s Board of Directors. He most recently served as the company’s Executive Vice President. Mr. Rutledge had previously served as President of the Vistawall Group since its acquisition by the company in 1984.
      Robert J. Novello retired from the Board of Directors in 2001. Mr. Novello, the retired, former Chairman of the Copeland Corporation, had served as a Director for five years.

Share Repurchase Agreement and Cash Dividends

In April 2001 the Board of Directors authorized the repurchase of 750,000 shares of Butler common stock to be used for employee benefit plans and other corporate purposes. Stock purchases may be made from time to time in the open market and in private transactions at prevailing market prices. At December 31, 2001, 345,600 shares remained available from the April 2001 Board authorization.

Page 18

      In September 2001, the company raised its quarterly dividend by 6%, from $.17 to $.18 per share, the seventh consecutive year for a dividend increase. On January 15, 2002 the Board of Directors declared a regular dividend of $.18 per share, payable on April 4, 2002, to shareholders of record on March 21, 2002. Dividends paid during 2001 totaled $4.3 million.

Outlook

At the close of 2001 most global economies were in recession. Nonresidential construction activity typically lags the movement in the general economy by several months, thus the near-term outlook for the construction industry is soft. Butler’s continued development of relationship accounts with major corporations, growth of dealer distribution networks, development of new products, and further expansion of existing products and services into underserved end-use markets are ongoing initiatives which may lessen the effect of the economic slow down. The company continues to manage and reduce current costs, while reducing future costs through Kaizen and Lean Sigma process improvements. In addition, the company’s systems approach to building construction solutions continue to capture a dominant share of the nonresidential construction market it serves. Order backlog at year-end was $291 million, 3% lower than a year ago.

Forward Looking Information

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which may include statements concerning projection of revenues, income or loss, capital expenditures, capital structure, or other financial items, statements regarding the plans and objectives of management for future operations, statements of future economic performance, statements of future operations, statements of the assumptions underlying or relating to any of the forgoing statements, and other statements which are other than statements of historical fact. These statements appear in a number of places in this report and include statements regarding the intent, belief, or current expectations of the company and its management with respect to (i) the cost and timing of the completion of new or expanded facilities, (ii) the company’s competitive position, (iii) the supply and price of materials used by the company, (iv) the demand and price for the company’s products and services, or (v) other trends affecting the company’s financial condition or results of operations including changes in manufacturing capacity utilization and corporate cash flow in both domestic and international markets. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially as a result of these various factors.

Note: Percentages presented within the MD&A are based upon amounts to the nearest thousand.

The sales by segment chart (page 14) presents segment sales before elimination of intersegment sales. The pretax (page 14) and capital employed (page 17) by segment charts do not present the other category.

Report of Independent Public Accountants

To the Shareholders of Butler Manufacturing Company:

We have audited the accompanying consolidated balance sheets of Butler Manufacturing Company (a Delaware corporation) and subsidiaries as of December 31, 2001 and 2000, and the related consolidated statements of earnings and retained earnings, comprehensive income and cash flows for each of the three years in the period ended December 31, 2001. These financial statements are the responsibility of the company’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. 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 consolidated financial statements referred to above present fairly, in all material respects, the financial position of Butler Manufacturing Company and subsidiaries at December 31, 2001 and 2000, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2001, in conformity with accounting principles generally accepted in the United States.
      As explained in the notes to the financial statements, effective January 1, 2001, the company changed its method of accounting for the recognition of asset gains and losses considered in the determination of net pension expense for its base retirement pension plan.

/S/ ARTHUR ANDERSEN LLP

Kansas City, Missouri
January 29, 2002

Page 19

Consolidated Balance Sheets

Butler Manufacturing Company

				At December 31,
Dollars in thousands				2001			2000
Assets
Current assets:
	Cash and cash equivalents			$	52,569		$	16,855
	Receivables:
		Trade			112,459			137,563
		Other			4,201			5,914
					116,660			143,477
		Allowance for possible losses			(7,138	)		(5,130	)
			Net receivables		109,522			138,347
	Inventories				57,435			61,504
	Real estate developments in progress				23,966			52,623
	Net current deferred tax assets				16,636			10,586
	Other current assets				14,939			11,855
			Total current assets		275,067			291,770
Investments and other assets					48,741			35,000
Assets held for sale					3,684			3,832
Property, plant, and equipment, at cost:
	Land				7,280			5,646
	Buildings				93,515			72,009
	Machinery, tools, and equipment				160,726			156,129
	Office furniture and fixtures				38,498			38,792
	Transportation equipment				2,341			1,856
	Accumulated depreciation				302,360			274,432
					(159,090	)		(157,036	)
			Net property, plant, and equipment		143,270			117,396
				$	470,762		$	447,998

See Accompanying Notes to Consolidated Financial Statements.

Page 20

			At December 31,
Dollars in thousands			2001			2000
Liabilities and Shareholders’ Equity
Current liabilities:
	Notes payable to banks		$	2,100		$	35,155
	Current maturities of long-term debt			5,617			5,563
	Accounts payable			70,362			78,219
	Dividends payable			1,131			1,064
	Accrued taxes and other expenses			79,624			54,440
	Accrued payroll and benefit expense			17,049			19,949
	Billings in excess of costs and estimated earnings			1,564			3,045
	Taxes on income			8,659			7,461
		Total current liabilities		186,106			204,896
Net noncurrent deferred tax liabilities				3,683			1,409
Other noncurrent liabilities				18,254			22,679
Long-term debt, less current maturities				98,244			53,298
Shareholders’ equity:
	Common stock, no par value, authorized 20,000,000 shares, issued 9,088,200 shares, at stated value, outstanding 6,280,783 shares in 2001 and 6,255,862 in 2000			12,623			12,623
	Foreign currency translation adjustment and hedging activity			(165	)		(1,477	)
	Minimum pension liability, net of tax			(6,626	)		–
	Retained earnings			223,594			220,113
	Cost of common stock in treasury, 2,807,417 shares in 2001 and 2,832,338 shares in 2000			(64,951	)		(65,543	)
		Total shareholders’ equity		164,475			165,716
			$	470,762		$	447,998

Page 21

Consolidated Statements of Earnings and Retained Earnings

Butler Manufacturing Company

		Years Ended December 31,
Dollars in thousands, except per share amounts			2001		2000			1999
Net sales		$	896,572		$	960,377		$	973,153
Cost of sales			759,331			791,654			801,144
	Gross profit		137,241			168,723			172,009
Selling, general, and administrative expenses			114,846			123,975			134,442
Asset impairment charge			4,285			–			–
Restructuring charge (credit)			3,854			(441	)		1,067
	Operating income		14,256			45,189			36,500
Other income (expense), net			935			(1,637	)		246
	Operating and other income (expense)		15,191			43,552			36,746
Interest expense			6,929			5,159			5,572
	Pretax earnings		8,262			38,393			31,174
Income tax expense			202			13,178			5,340
	Net earnings		8,060			25,215			25,834
Retained earnings at beginning of year			220,113			199,229			178,536
			228,173			224,444			204,370
Dividends declared:
	Common stock, $.70, $.66, and $.62 per share		(4,400	)		(4,241	)		(4,352	)
Net change in retained earnings from treasury stock transactions			(179	)		(90	)		(789	)
Retained earnings at end of year		$	223,594		$	220,113		$	199,229
Basic earnings per share		$	1.28		$	3.87		$	3.66
Diluted earnings per share		$	1.28		$	3.86		$	3.63

Consolidated Statements of Comprehensive Income

Butler Manufacturing Company

			Years Ended December 31,
Dollars in thousands				2001		2000			1999
Net earnings:			$	8,060		$	25,215		$	25,834
	Other comprehensive income (loss):
		Foreign currency translation adjustment and hedging activity		(437	)		(375	)		(1,050	)
		Minimum pension liability, net of tax		(6,626	)		–			–
Comprehensive income			$	997		$	24,840		$	24,784

See Accompanying Notes to Consolidated Financial Statements.

Page 22

Consolidated Statements of Cash Flows

Butler Manufacturing Company

				Years Ended December 31,
Dollars in thousands					2001		2000			1999
Cash flows from operating activities:
Net earnings				$	8,060		$	25,215		$	25,834
Adjustments to reconcile net earnings to net cash provided (used) by operating activities:
	Depreciation and amortization				18,104			15,594			19,972
	Asset impairment				4,285			–			–
	Restructuring charge (credit)				3,854			(441	)		1,067
	Equity in loss (earnings) of joint ventures				87			(349	)		(241	)
	Change in assets and liabilities, net of sale of businesses and excluding effect of pension and hedging related other comprehensive income:
		Net receivables			28,175			(23,122	)		15,034
		Inventories			2,928			(1,519	)		10,405
		Real estate developments in progress			28,657			(33,898	)		414
		Net current deferred tax assets			285			(1,581	)		(93	)
		Other current assets and total current liabilities			(1,908	)		9,707			10,387
		Other noncurrent operating assets and liabilities			(18,836	)		4,241			(5,786	)
			Net cash provided (used) by operating activities		73,691			(6,153	)		76,993
Cash flows from investing activities:
Capital expenditures					(44,583	)		(36,938	)		(13,634	)
Dividend received from joint venture					–			2,400			–
Net increase in other nonoperating noncurrent assets					(1,326	)		(4,418	)		(641	)
			Net cash used by investing activities		(45,909	)		(38,956	)		(14,275	)
Cash flows from financing activities:
Proceeds from issuance of long-term debt					50,701			1,650			–
Repayment of long-term debt					(5,755	)		(5,373	)		(5,880	)
Net change in notes payable to banks					(33,001	)		31,731			1,528
Dividends paid					(4,332	)		(4,277	)		(4,344	)
Issuance of treasury stock					871			778			2,812
Purchase of treasury stock					(279	)		(15,121	)		(13,093	)
		Net cash provided (used) by financing activities			8,205			9,388			(18,977	)
Effect of exchange rate changes					(273	)		(375	)		(1,050	)
		Net change in cash and cash equivalents			35,714			(36,096	)		42,691
Cash and cash equivalents at beginning of year					16,855			52,951			10,260
		Cash and cash equivalents at end of year		$	52,569		$	16,855		$	52,951

See Accompanying Notes to Consolidated Financial Statements.

Page 23

Notes to Consolidated Financial Statements

Butler Manufacturing Company

Significant Accounting Policies

Principles of Consolidation
The consolidated financial statements include Butler Manufacturing and all subsidiaries more than 50% owned (herein stated as “the company”). Investments in business entities in which the company does not have control (generally 20 to 50 percent ownership) are accounted for by the equity method. All significant intercompany profits, account balances, and transactions are eliminated in consolidation.

Reclassifications
Certain reclassifications have been made to prior years information to conform to the 2001 presentation.

Use of Estimates
Management of the company has made a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these consolidated financial statements in conformity with generally accepted accounting principles in the United States. Actual results could differ from those estimates.
      The company is subject to third-party general liability and workers compensation claims which arise in the ordinary course of business. General liability and workers compensation claim costs include an estimate of expected settlements, defense costs, and an allowance for claims incurred but not yet reported that fall within the company’s deductible arrangements with its insurers. Original claims estimates are based on the company’s insurers’ and management’s evaluations of the nature and severity of individual claims, however, ultimate claims settlement costs may vary from original estimates. Estimates of future claim development costs, based on historical claims development trends, are included in operating expense. The time period from when a claim is asserted and ultimately resolved through dismissal or settlement may be several years.

Sales Recognition
Sales from manufacturing operations are recognized when goods are shipped “free on board” (FOB) from their shipping point and when all obligations of the company have been met. For those limited instances where goods are shipped on company trucks, sales are recognized on a FOB destination point basis.
      The company recognizes sales and gross profit on construction contracts using the percentage of completion method based on construction costs incurred and the total estimated costs of the construction project. Construction project costs incurred is based on the delivery of goods and completion of construction services as provided in the accordance with the terms of the contract with the customer.
      Sales and gross profit for the Real Estate segment are recognized when real estate development projects are sold to third party investors. Rental income, classified as other income, is recognized on completed projects occupied by leasing tenants while the project is being held for sale.

Cash and Cash Equivalents
Cash and cash equivalents are defined as all demand deposits and highly liquid investments with original maturities of 90 days or less.

Inventories
Inventories are valued at the lower of cost or market and include material, labor, and manufacturing overhead. The last-in, first-out (LIFO) method of determining cost is used for substantially all domestic inventories. If the first-in, first-out (FIFO) method had been used for all locations, inventories would have been $8.5 million and $9.9 million higher than those reported at December 31, 2001 and 2000, respectively.
      The use of the LIFO method to calculate cost of sales increased net earnings by $.9 million ($.14 per share) in 2001, decreased net earnings by $.4 million ($.06 per share) in 2000, and increased net earnings by $.5 million ($.08 per share) in 1999.
      During 2001, inventory levels decreased in certain of the company’s business units. Under the LIFO method this had the effect of charging the 2001 cost of sales with prior years’ costs that were $.5 million lower than 2001 costs, thereby increasing net earnings by $.3 million or $.05 per share. These amounts are included in the net earnings and per share amounts presented above.

Inventories by Component

Dollars in thousands		2001			2000
Raw materials		$	20,132		$	22,059
Work in process			13,692			10,685
Finished goods			32,100			38,686
	FIFO inventory		65,924			71,430
LIFO reserve			(8,489	)		(9,926	)
	Inventory	$	57,435		$	61,504

Property, Plant, and Equipment
Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. Expenditures for maintenance and repairs are charged to expense as incurred. Upon sale or retirement of assets, the cost and the accumulated depreciation amounts are removed from the accounts.
      Interest has been capitalized in connection with the development of new facilities and is amortized over the estimated useful life of the related asset. Interest capitalized was $.6 million during the year 2001, $.3 million in 2000 and no interest was capitalized in 1999.

Page 24

      Total capital expenditures for 2001 were $45 million compared to $37 million in 2000. Approximately $27 million was used to construct the majority of the company’s new headquarters building. Other expenditures include costs to complete the installation of process lines in the new Vistawall extrusion plant in Tennessee and the construction of the company’s Shanghai, China office and warehouse facilities.

Research and Development Costs
Costs incurred in the creation and start-up of new products or changes of existing products are charged to expense as incurred. The company expended $2.6 million, $3.6 million and $2.9 million of research and development costs in 2001, 2000, and 1999, respectively.

Capitalized Software
Capitalized software costs are recorded in “Investments and other assets” in the consolidated balance sheets in accordance with the Accounting Standards Executive Committee’s Statement of Position 98-1, “Accounting for the Costs of Computer Software Developed or Obtained for Internal Use.” At December 31, 2001 and 2000, capitalized software costs, net of amortization, were $14.7 million and $13.8 million, respectively. Costs capitalized in 2001 includes the initial implementation of a scalable enterprise system in the U.S. buildings business. Costs are amortized on a straight-line basis over periods not exceeding 7 years once applications are implemented and operational. Amortization of software cost was $4.4 million in 2001, $3.4 million in 2000, and $3 million in 1999. During 2001 and 2000 unamortized costs of software applications were reduced by $1.3 million and $4.9 million, respectively, and reflect the disposition of certain software applications in the U.S. buildings business.

Goodwill and Other Intangible Assets
In July 2001, the Financial Accounting Standards Board (FASB), issued Statement of Financial Accounting Standards (SFAS) No. 142, “Goodwill and Other Intangible Assets.” SFAS No. 142 provides guidance on accounting and reporting for goodwill and intangible assets. Goodwill will no longer be amortized over future periods, but will be assessed at least annually for impairment using a fair value based test. The company will adopt this new standard on January 1, 2002.
      As of January 1, 2002 the company tested for impairment the Architectural Products business segment using the income approach and determined that its fair value exceeded its carrying value. On an on-going basis, and absent any impairment indicators, the company will conduct similar impairment tests and record any impairment loss.
      Prior to the 2001 asset impairment charge, the company had goodwill of $5.9 million, with $5.5 million in the Architectural Products segment and $.4 million in the European operation of its International Buildings Systems segment. European goodwill was written off in 2001 with the disposition of the European business. At the end of year the company had goodwill of $5.5 million. Goodwill was amortized over 40 years prior to adoption of this standard. Goodwill amortization in 2001 was $1 million, net of tax. The effect on net income of not amortizing these costs is anticipated to be $.1 million ($.02 per share) for each of the next five years starting with 2002.
      Other intangible assets include amortized cost associated with non-compete agreements totaling $1.5 million at December 31, 2001, which are being amortized over the 15 year life of the agreements prior to the adoption of this standard. For 2001 amortization was $.1 million, net of tax.

Derivative Instruments and Hedging Activities
The Financial Accounting Standards Board issued SFAS No. 133 “Accounting for Derivative Instruments and Hedging Activities”, as amended, effective for fiscal years beginning January 1, 2001. These statements require derivative instruments be recorded in the balance sheet at its fair value either as an asset or liability. Changes in a derivative’s fair value are recognized in current earnings or in other comprehensive income.
      The company enters into aluminum contracts to hedge the cost of a portion of the aluminum used in its Architectural Products segment. These contracts qualify for hedge accounting under SFAS No. 133. Unrealized gains or losses on open contracts are recorded in comprehensive income until the contract settles with a corresponding adjustment to inventory (for losses) or deferred income (for gains). Gains or losses on contracts are recognized in earnings as an adjustment to cost of sales when the underlying inventory is sold. No gain or loss related to ineffectiveness was recorded for open contracts due to the highly effective nature of the hedges and the immaterially of the ineffectiveness between the derivative and the underlying purchase transaction. As of December 31, 2001, the amount recorded in cumulative other comprehensive income related to these contracts, which is expected to be recognized in earnings during 2002, is $.1 million, net of tax.
      The company enters into forward currency exchange contracts to hedge a portion of its exposure associated with Canadian dollar denominated sales and net cash flow for its Canadian operations within the Northern American Buildings Systems segment. The company’s costs for this operation are primarily denominated in U.S. dollars. While these hedge contracts would qualify for hedge accounting under SFAS No. 133, the company has not chosen to designate these derivatives as hedge contracts, under SFAS No. 133, due the immaterially of the unrealized gains or losses on such open contracts, at its normal level of activity. Accordingly, the company records the unrealized gain or loss from these derivatives in earnings as opposed to other comprehensive income. For major customer projects or for non-Canadian operations, where customer or vendor payments are denominated in a foreign currency, the company may pre-designate related forward currency exchange contracts as cash

Page 25

Notes to Consolidated Financial Statements

Butler Manufacturing Company

flow hedges under SFAS No. 133 on a case-by-case basis. As of December 31, 2001, no such designation has been made.

Financial Instruments
The fair value of long-term debt is determined by comparing interest rates for debt with similar terms and maturities. At December 31, 2001 and 2000 the fair value of the company’s long-term debt was not materially different than its carrying value. Other financial instruments, consisting of cash and cash equivalents, net receivables, notes payable, and accounts payable are carried at cost, which approximates fair value, as a result of the short-term nature of these instruments. The company has no significant concentrations of credit risk.

Earnings Per Share
Basic earnings per share is based upon the weighted average common shares outstanding during each year. Dilutive earnings per share is based upon the weighted average common and common equivalent shares outstanding during each year. Employee stock options are the company’s only common stock equivalents; there are no other potentially dilutive securities.

Basic and Diluted Earnings Per Share (EPS) Computations

	2001
Dollars in thousands,	Net			Per Share
except per share amounts	Earnings		Shares	Amount
Basic EPS available to common shareholders	$	8,060	6,281	$	1.28
Assumed conversion of stock options			4
Diluted EPS available to common shareholders  plus assumed conversions	$	8,060	6,285	$	1.28
			2000
Dollars in thousands,	Net			Per Share
except per share amounts	Earnings		Shares	Amount
Basic EPS available to common shareholders	$	25,215	6,521	$	3.87
Assumed conversion of stock options			10
Diluted EPS available to common shareholders  plus assumed conversions	$	25,215	6,531	$	3.86
			1999
Dollars in thousands,	Net			Per Share
except per share amounts	Earnings		Shares	Amount
Basic EPS available to common shareholders	$	25,834	7,064	$	3.66
Assumed conversion of stock options			47
Diluted EPS available to common shareholders  plus assumed conversions	$	25,834	7,111	$	3.63

     The following exercisable options were excluded from the computations of shares outstanding in one or more quarters in the determination of the annual diluted EPS presented above. Exercisable options are not considered to be common equivalent shares during quarters when the options’ exercise price exceeded the average market price of the company’s common shares.

Options Excluded from Diluted EPS

Year
excluded	Number of	Range of exercise	Year(s) the
from EPS	option shares	prices for excluded	excluded options
calculation	excluded	option shares	expire
2001	487,719	$26.00 - $38.50	2001 to 2006
2000	513,500	$26.00 - $38.75	2001 to 2006
1999	368,500	$23.00 - $38.75	2001 to 2006

Foreign Currency Translation
The value of the U.S. dollar fluctuates on foreign currency exchanges which creates exchange gains or losses on the company’s international investments. These investments, and the related equity earnings and losses, are translated into U.S. dollars at year end and average exchange rates, respectively. The gains or losses that result from translation are shown in the shareholders’ equity section of the consolidated balance sheets. Cumulative foreign currency exchange translation gains were less than $.1 million at December 31, 2001. Cumulative foreign currency exchange translation losses were $1.5 million at December 31, 2000.

Comprehensive Income
The components of comprehensive income are foreign currency translation adjustments, hedging activities, and minimum pension liabilities. The tax effect on foreign currency translations and hedging activities was deemed immaterial. Minimum pension liability, net of taxes of $4.1 million, was $6.6 million.

Construction Contracts
Costs and estimated earnings in excess of billings on construction contracts were $4.9 million and $4.3 million at December 31, 2001 and 2000, respectively, and are reflected in the consolidated balance sheets under the caption “Inventories.”
      Total receivables due under construction contracts, which are included as trade receivables, were $21.7 million and $28.7 million at December 31, 2001 and 2000, respectively. Included in the contract receivables were $6.3 million and $5.1 million at December 31, 2001 and 2000, respectively, for amounts billed but not collected pursuant to retainage provisions. These amounts are generally due upon completion of the contracts. Contract receivables, including retention, which the company expects to collect within the next twelve months, are classified as Trade Receivables in the company’s

Page 26

balance sheet. Retention older than one year and included in Trade Receivables, totaled $1.1 million and $.6 million at December 31, 2001 and 2000, respectively. Contract receivables where the anticipated collection date is not within the next twelve months are classified under Investments and other assets.

Restructuring and Asset Impairment Charges
During the fourth quarter of 2001, the company’s board of directors approved the disposition of the assets of the company’s European building business part of the international building systems segment. The company has entered into a letter of intent to sell certain assets of the business. As a result, the company recorded a $8.1 million pretax charge in December of 2001. $4.3 million of the pretax charge is for the write-down of certain assets at its European business to estimated net realizable value based on estimated proceeds from the sale in accordance with SFAS No. 121, “Accounting for the Impairment of Long-lived Assets to be Disposed of”. The remaining $3.9 million is a restructuring charge for employee separation costs, related to those employees notified of a termination prior to December 31, 2001, costs to close offices, and other expenses related to the disposition of the business.
      In 1999, the company recorded a $1.5 million restructuring charge for currency translation losses on remaining Brazilian net asset which were written down in 1998 as part of a restructuring of the Brazilian metal buildings business. Of the $.9 million in restructuring reserve at the end of 1999, $.3 million was utilized and the remaining $.6 million was taken to income as a recovery in 2000. Final activities related to restructuring were completed during 2000, resulting in a $.4 million reversal of the remaining accrual. In 2001 additional restructuring reserves totaling $3.9 million were established and $1.7 million was utilized. Recap of activity in the restructuring reserve during 2001 and 2000, is presented below.

Restructuring Charge Accrual Activity

			2000										2001
	12/31/99										12/31/00									12/31/01
Dollars in thousands	Balance		Accrual		Recovery			Utilized			Balance		Accrual		Recovery		Utilized			Balance
Severance and termination costs	$	256	$	–	$	–		$	(256	)	$	–	$	1,161	$	–	$	–		$	1,161
Foreign Exchange Loss		–		–		–			–			–		1,749		–		(1,749	)		–
Legal, claims, and other costs		629		–		(620	)		(9	)		–		944		–		–			944
	$	885	$	–	$	(620	)	$	(265	)	$	–	$	3,854	$	–	$	(1,749	)	$	2,105

     The detail of restructuring charges (credits) reported on the company’s statements of earnings for 2001, 2000, and 1999 is presented below.

Restructuring and Asset Impairment Charges (Credits) Activity

Dollars in thousands	2001		2000			1999
European business	$	3,854	$	–		$	–
Recoveries		–		(620	)		(295	)
Redundant–worthless assets activity		–		179			(152	)
Foreign currency devaluation – Brazil		–		–			1,514
Restructuring Charge (Credit)	$	3,854	$	(441	)	$	1,067
Asset Impairment Charge	$	4,285	$	–		$	–

Assets Held for Sale
BMC Real Estate, Inc., a wholly-owned subsidiary, owns land for development which is included in “Assets held for sale” in the consolidated balance sheets. During 2001 and 2000, one land parcel was sold each year. The gain on each sale was less than $.1 million.

International Joint Venture Operations
The company has a 30% interest in an international joint venture, Saudi Building Systems. The joint venture is involved in the design, manufacture, and marketing of pre-engineered metal buildings for nonresidential use in its respective market.
      During 2000, the company received a $2.4 million cash dividend from Saudi Building Systems, which represented a partial return of equity earnings. The company’s investment was $2 million at December 31, 2001 and $2 million at December 31, 2000.
      During 2001, the company acquired a 40% interest in Vistawall International (UAE) Ltd. The joint venture is involved in the design, manufacture, and sale of architectural aluminum products in the Middle Eastern markets. The company’s investment was $.3 million at December 31, 2001.

Page 27

Notes to Consolidated Financial Statements

Butler Manufacturing Company

Business Segments

The company groups its operations into five business segments: North American Building Systems, International Building Systems, Architectural Products, Construction Services, and Real Estate.
      The North American Buildings Systems segment includes the building system businesses in Canada, the U.S., and Latin America. The International Building Systems segment includes foreign building systems businesses in Europe and Asia and the company’s international joint venture operations in the Middle East. These business units supply steel and wood frame pre-engineered building systems for a wide variety of commercial, community, industrial, and agricultural applications.
      The Architectural Products segment includes the operations of the Vistawall Group. The group’s businesses design, manufacture, and market architectural aluminum systems for nonresidential construction, including curtain wall, storefront, window, and skylight systems.
      The Construction Services segment sells and constructs large, complex metal building systems, working in conjunction with the Butler Builder organization. Typical projects are large distribution centers and industrial buildings.
      The Real Estate segment provides real estate build-to-suit-to-lease development services in cooperation with Butler dealers.
      The accounting policies for the segments are the same as those described in the summary of significant accounting policies. The company’s reportable segments are strategic business units that offer different products and services. They are managed separately because each business requires different technology and expertise.
      The Other classification in the following tables represents unallocated corporate expenses and assets, including corporate offices, deferred taxes, pension accounts, interest expense, and intersegment eliminations.

Net Sales

Dollars in thousands	2001			2000			1999
North American Building Systems	$	440,049		$	530,235		$	546,398
International Building Systems		81,644			86,235			83,513
Architectural Products		231,509			224,130			202,332
Construction Services		132,930			149,273			151,937
Real Estate		37,555			7,682			27,309
Intersegment eliminations		(27,115	)		(37,178	)		(38,336	)
	$	896,572		$	960,377		$	973,153

     Net sales represent revenues from sales to affiliated and unaffiliated customers before elimination of intersegment sales which is included in Intersegment eliminations. Intersegment eliminations are primarily sales from the North American Building Systems to Construction Services.

Interest Expense

Dollars in thousands	2001		2000		1999
North American Building Systems	$	4	$	27	$	284
International Building Systems		122		206		433
Architectural Products		61		–		–
Construction Services		–		–		–
Real Estate		383		351		92
Other		6,359		4,575		4,763
	$	6,929	$	5,159	$	5,572

Pretax Earnings (Loss)

Dollars in thousands	2001			2000			1999
North American Building Systems	$	10,417		$	31,673		$	18,306
International Building Systems		(6,075	)		4,127			4,170
Architectural Products		13,828			16,381			19,263
Construction Services		3,234			2,505			2,248
Real Estate		5,974			2,644			4,094
Other		(19,116	)		(18,937	)		(16,907	)
	$	8,262		$	38,393		$	31,174

     The 2001 pre-tax loss for International Buildings Systems includes special charges of $8.1 million associated with the segment’s European operations.

Assets

Dollars in thousands	2001		2000
North American Building Systems	$	138,690	$	156,002
International Building Systems		67,064		62,563
Architectural Products		112,785		108,688
Construction Services		22,465		31,231
Real Estate		28,406		55,331
Other		101,352		34,183
	$	470,762	$	447,998

     Assets represent both tangible and intangible assets used by each business segment. Other represents corporate cash and cash equivalents, assets held for sale, corporate fixed assets, including the company’s headquarters facility, and various other assets which are not related to a specific business segment.

Page 28

Capital Expenditures

Dollars in thousands	2001		2000		1999
North American Building Systems	$	4,559	$	5,248	$	8,251
International Building Systems		6,228		5,849		2,683
Architectural Products		6,391		24,229		2,188
Construction Services		176		212		299
Real Estate		–		–		–
Other		27,229		1,400		213
	$	44,583	$	36,938	$	13,634

     Included in Other and North American Building Systems for 2001 are the expenditures for the company’s new headquarters facility. Included in Architectural Products for 2000 are expenditures for the Tennessee extrusion facility.

Depreciation and Amortization

Dollars in thousands	2001		2000		1999
North American Building Systems	$	10,371	$	9,322	$	14,261
International Building Systems		2,161		1,772		1,535
Architectural Products		4,221		3,098		2,879
Construction Services		729		786		714
Real Estate		8		8		9
Other		614		608		574
	$	18,104	$	15,594	$	19,972

Geographic Information by Country
The following table presents revenues by country based on the location of delivery of the product or service. The U.S. is the only country in which net sales exceeded 10% of the company’s consolidated net sales.

Net Sales

Dollars in thousands	2001		2000		1999
United States of America	$	781,646	$	824,552	$	829,187
All other countries		114,926		135,825		143,966
	$	896,572	$	960,377	$	973,153

     The following table presents all noncurrent assets by country based on the location of the asset. The U.S. is the only country in which long-lived assets exceeded 10% of the company’s consolidated long-lived assets.

Tangible Long-Lived Assets

Dollars in thousands	2001		2000
United States of America	$	141,034	$	116,863
All other countries		20,513		18,485
	$	161,547	$	135,348

Debt, Leases, Commitments, and Contingencies

Long-Term Debt

Dollars in thousands		2001		2000
2001 private placement notes		$	50,000	$	–
1998 private placement notes			35,000		35,000
1994 private placement notes			10,000		15,000
Industrial revenue bonds			6,250		6,250
Other debt			2,611		2,611
Total long-term debt			103,861		58,861
Less current maturities			5,617		5,563
	Long-term debt	$	98,244	$	53,298

Long-Term Debt
During 2001 the company issued $50 million in senior unsecured private placement notes to a group of insurance companies. The 2001 private placement notes carry an all-in fixed interest rate of 7.91% and are payable in equal annual installments of $4.5 million beginning in 2006. The notes mature December 30, 2016.
      The 1998 private placement notes carry a fixed interest rate of 6.57% and are payable in equal annual installments of $3.5 million beginning in 2004. The notes mature March 20, 2013.
      The 1994 private placement notes carry a fixed interest rate of 8.02% and are payable in equal annual installments of $5 million. The notes mature December 30, 2003.
      The Industrial Revenue Bonds mature in 2015, are guaranteed by the company, and are fully secured by a bank letter of credit which is guaranteed by the company. The weighted-average interest rate on the bond issue was 3.9% for 2001, 5% for 2000, and 3.9% for 1999.
      Total principal payments due on all debt in each of the five years subsequent to December 31, 2001 are $5.6 million in 2002, $5.5 million in 2003, $4 million in 2004, $3.9 million in 2005, $3.8 million in 2006, and $81.1 million thereafter. Cash payments for interest on long-term debt were $6.9 million, $5.1 million and $4.6 million in 2001, 2000, and 1999, respectively.

Short-Term Borrowings
During 2001 and 2000 the company borrowed to meet working capital needs and other requirements. At December 31, 2001 the company and its subsidiaries had short-term bank credit facilities totaling $56 million. Two foreign subsidiary credit facilities totaling $6 million are secured. The $3 million facility for the company’s Hungarian subsidiary is secured by all of its assets. Certain assets of its assets secure the $3 million facility for the company’s China subsidiary. Borrowings outstanding at December 31, 2001 were $2.1 million at a weighted average interest rate of 5.27%. The company has committed $9.6 million of its credit facilities under various letters of credit for certain obligations. At December 31, 2001 the company had approximately $44.3 million of available borrowing capacity under existing facilities.

Page 29

Notes to Consolidated Financial Statements

Butler Manufacturing Company

Debt and Borrowing Covenants
The company’s credit agreements contain certain limitations on additional borrowings, the payment of cash dividends, and the purchase of company stock, as well as covenants related to the maintenance of certain financial ratios. As of December 31, 2001 the company was in compliance with all covenants and at that date, approximately $29 million was available for additional cash dividends and share repurchases.

Leases
Rental expense under operating leases was $10.9 million, $11.3 million, and $11 million in 2001, 2000, and 1999, respectively. Minimum rental commitments under noncancelable operating leases are $6 million in 2002, $4.5 million in 2003, $2.9 million in 2004, $1.4 million in 2005, and $.6 million in 2006.

Commitments and Contingencies
The company is subject to various legal proceedings, claims, and environmental actions which arise in the ordinary course of business operations. Although the ultimate outcome of these matters is presently not determinable, management, after consultation with legal counsel, believes the resolution of these matters will not have a material adverse effect upon the company’s financial position or results of operations.

Related Party Transaction
During 2001, the company purchased real estate in Kansas City, Missouri upon which the company constructed its new corporate and certain division headquarters building. The company purchased the site, constituting approximately 7.8 acres, from N.F. Bldg. Corp., a unit of National Farms, Inc. for the price of $2.7 million. The purchase price was determined by independent appraisals of the site. C.L. William Haw, a director of the company, is President and Chief Executive Officer of National Farms, Inc.

Taxes on Income

The components of the provision for income taxes are shown below.

Components of Income Taxes

Dollars in thousands		2001			2000			1999
Current:
	Federal	$	(1,646	)	$	12,442		$	3,665
	Foreign		720			186			13
	State and local		842			2,131			1,755
			(84	)		14,759			5,433
Deferred:
	Federal		479			(1,456	)		(86	)
	Foreign		(234	)		–			–
	State and local		41			(125	)		(7	)
			286			(1,581	)		(93	)
	Total income tax expense	$	202		$	13,178		$	5,340

     Tax expense in 2001 reflects a one-time tax benefit of $4.5 million related to the disposition of the European business. Year 2000 was the last year of a full tax holiday for the company’s Chinese subsidiary. Beginning in 2001, its earnings were taxed at a reduced percentage of the Chinese statutory rate. In 1999 the company sold all shares of its United Kingdom metal building business and recorded a tax benefit of $5.8 million. The sale of shares resulted in a capital loss used to offset prior capital gains. Cash payments for income taxes were $3.6 million, $5.3 million, and $15.8 million in 2001, 2000, and 1999, respectively. The foreign components of pretax earnings were net profits (loss) of $(6.1) million, $4.5 million and $4.4 million in 2001, 2000 and 1999, respectively.
      A reconciliation of the statutory federal income tax and the income tax expense is shown below.

Reconciliation of Income Tax Expense

Dollars in thousands		2001			2000			1999
Expected income tax expense on   pretax earnings before asset impair-   ment and restructuring charge		$	5,615		$	13,438		$	5,100
State and local income   tax, net of federal benefits			554			1,385			1,141
Nondeductible losses (nontaxable   profits) of foreign subsidiaries			1,199			(1,378	)		(1,533	)
Tax benefit from foreign sales corporation			(307	)		(229	)		(350	)
China tax less than U.S. statutory rate			(1,195	)		–			–
Settlement of audits			(577	)		–			–
Utilization of capital loss carryforward			(651	)		–			–
Asset impairment and restructuring charge			(4,500	)		–			–
Other			64			(38	)		982
	Actual income tax expense	$	202		$	13,178		$	5,340

     Deferred income tax expense or benefit arises from differences between financial reporting and tax reporting of assets and liabilities, which most often result from the differences in timing of income and expense recognition. Differences between financial reporting and tax bases also arise due to business acquisition activity as tax laws can result in significant differences in values assigned to assets and liabilities. Previously recorded deferred tax assets and liabilities are adjusted for any changes in enacted tax rates. Detail of deferred tax assets and liabilities is shown below.

Page 30

Net Current Deferred Tax Assets and Liabilities

Dollars in thousands		2001			2000			1999
Current deferred tax assets (liabilities):
	Operating expenses	$	11,318		$	9,722		$	8,156
	Inventory		1,439			656			821
	Restructuring charge		(182	)		(27	)		–
	Minimum pension liability		4,061			–			–
	Other		–			235			261
	Net current deferred tax assets	$	16,636		$	10,586		$	9,238

Net Noncurrent Deferred Tax Assets and Liabilities

Dollars in thousands			2001			2000			1999
Noncurrent deferred tax assets (liabilities):
	Depreciation		$	(9,621	)	$	(8,308	)	$	(8,664	)
	Operating expenses			3,440			4,839			5,845
	Minority investments			293			280			(428	)
	Foreign net operating loss and   capital loss carryforward			2,675			1,641			1,347
	Asset impairment			2,676			2,783			2,905
	Deferred income			–			(572	)		(655	)
	Other			(471	)		(431	)		(645	)
	Net noncurrent deferred tax assets (liabilities)			(1,008	)		232			(295	)
	Valuation allowance			(2,675	)		(1,641	)		(1,347	)
		Net noncurrent deferred tax liabilities	$	(3,683	)	$	(1,409	)	$	(1,642	)

Employee Benefit Plans

Retirement Plans
The company provides retirement benefits for substantially all employees, either through a defined benefit plan, the defined contribution Individual Retirement Asset Account Plan (IRAA), or a combination of both types of plans.
      The majority of the company’s salaried and nonunion hourly employees are covered by both a defined benefit plan and the IRAA. These plans are integrated as to retirement benefits, in a floor-offset arrangement. The monthly benefit value of the IRAA lump sum distributable to a participant offsets a portion, or all of their defined benefit. The defined benefit, before the IRAA offset, is based upon compensation and years of service. Bargaining unit employees are covered by defined benefit retirement plans with benefits based on years of service.
      The IRAA assets include the company’s common stock, other equities, bonds, and government securities. The IRAA had net assets of $50 million and $51 million, including 727,101 shares and 768,637 shares of company stock with a market value of $19.9 million and $19.5 million at December 31, 2001 and 2000, respectively. The company expensed $.7 million for IRAA contributions in 2001, 2000, and 1999, respectively.
      A reconciliation of benefit obligations and plan assets, the funded status, and the amounts recognized in the company’s balance sheets for the defined benefit plans are presented below. While the market value of IRAA assets is not expressly shown in the tables, the effect of the IRAA offset against the company’s defined benefit obligation has been recognized by a reduction in the various benefit obligations presented. The assets of the defined benefit plans are primarily equities, bonds, and government securities.

Reconciliations of Benefit Obligation and Plan Assets, Funded Status and Amounts Recognized in the Consolidated Balance Sheets

Dollars in thousands		2001			2000
Reconciliation of projected benefit obligation (Actuarial present value of future benefits including future increases in compensation levels and future service)
Projected benefit obligation at January 1		$	101,258		$	87,413
Service cost–benefits earned during the year			4,994			4,657
Interest accrued on projected benefit obligation			8,400			7,086
Amendments to plans			3,659			421
Actuarial loss during the year			16,859			5,135
Benefits paid			(3,626	)		(3,454	)
	Projected benefit obligation at December 31	$	131,544		$	101,258
Vested and accumulated benefit obligations (For service and compensation through December 31)
Vested benefit obligation		$	76,149		$	64,792
Non-vested accrued benefits		$	6,715		$	4,740
Accumulated benefit obligation		$	82,864		$	69,532
Reconciliation of fair value of plan assets
Fair value of plan assets at January 1		$	80,761		$	79,325
Actual return on plan assets			(5,258	)		(3,993	)
Employer contributions			10,176			8,883
Benefits paid			(3,626	)		(3,454	)
	Fair value of plan assets at December 31	$	82,053		$	80,761
Funded status and net amount recognized at December 31
Funded status–projected benefit obligation   greater than plan assets		$	(49,491	)	$	(20,497	)
Unrecognized net transition obligation cost			2			77
Unrecognized prior service cost			4,769			2,318
Unrecognized net actuarial loss			53,428			25,336
	Net amount recognized (see detail below)	$	8,708		$	7,234
Amounts recognized in the consolidated balance sheet at December 31
Prepaid pension expense		$	9,391		$	8,048
Accrued pension liability			(15,032	)		(814	)
Intangible asset			4,237			–
Cumulative other comprehensive income			10,112			–
	Net amount recognized	$	8,708		$	7,234

Page 31

Notes to Consolidated Financial Statements

Butler Manufacturing Company

     Effective January 1, 2001, the company changed its method for the recognition of asset gains and losses considered in the calculation of the annual net pension expense for its base retirement pension plan. The company changed from the market-value method of asset valuation to a market-related value method. Under the previous accounting method all gains and losses, subject to a 10 percent corridor, were recognized and amortized in determination of the net periodic pension cost. The new method recognizes and then amortizes annual asset gains or losses over a five-year period in determination of annual net periodic pension cost. The new method is commonly used and is preferable to the old method because it more accurately matches expense to accounting periods during which benefits are earned. The impact of the change was to increase net income by $.4 million and earnings per share by $.07 for the year ended December 31, 2001. The cumulative effect of this change as of January 1, 2001 was immaterial. However, had this method been applied retroactively, net income would have been reduced by $.3 million or $.05 per share in 2000 and $.2 million or $.03 per share in 1999.
    The company also changed, effective April 1, 2001, the period used to amortize prior service costs associated with amendments to its pension plans. Previously, the effect of these amendments was amortized over the average future working lifetime of those expected to receive benefits. The new amortization period recognizes the cost of such plan amendments in the year during which the benefit is earned. The effect of this change in accounting estimate was a decrease in net income of $.5 million and a reduction in earnings per share by $.07, for the year ended December 31, 2001.
      The components of net pension expense of the defined benefit plans, as determined under SFAS 87, “Employers’ Accounting for Pensions,” are presented below.

Components of Net Pension Expense

Dollars in thousands		2001			2000			1999
Service cost – benefits earned during the year		$	4,994		$	4,657		$	4,562
Interest cost on the projected benefit obligation			8,400			7,086			6,172
Expected return on plan assets			(7,412	)		(6,768	)		(5,609	)
Amortization of transition obligation			75			197			197
Amortization of prior service cost			1,208			253			259
Amortization of net actuarial loss			1,437			704			1,282
	Net pension expense	$	8,702		$	6,129		$	6,863
Key assumptions used to determine net   pension expense and benefit obligations:
	Discount rate of future benefit obligations		7.25%			7.75%			7.75%
	Long-term expected return on plan assets		8.50%			8.50%			8.50%
	Long-term rate of increase in compensation levels		5.50%			5.50%			5.50%

Other Benefit Plans
The company sponsors the Butler Employees Savings Trust, a savings plan under section 401(k) of the Internal Revenue Code. All U.S. based salaried and nonunion hourly employees are eligible to participate in this plan. If certain company profitability levels are attained, the company will match 30% of employees’ contributions, for employee contributions up to 6% of each employee’s eligible compensation. In 2001, 2000, and 1999 the company reached the defined profitability goals and accordingly expensed $1.8 million, $1.7 million, and $1.6 million, respectively, as a matching contribution to the plan. In addition, the company sponsors 401(k) savings plans for its bargaining unit employees.
      The company sponsors a nonqualified ERISA-excess retirement plan. The plan restores retirement benefits by applying the benefit formula from the qualified plan to the portion of employee compensation that is in excess of IRS limits for qualified plans. Life insurance arrangements have been purchased to offset certain liabilities of the plan. The company expensed $.4 million, $.7 million, and $1 million in 2001, 2000, and 1999, respectively, related to this plan. In addition, the company recorded a pre-tax other comprehensive income charge of $.6 million during 2001 for this plan.
     The company offers a nonqualified, deferred compensation plan to certain key executives. In 2001, 2000, and 1999 the company expensed $.5 million, $.4 million, and $.4 million, respectively, which represented earnings credited to participants’ accounts. The plan liability at December 31, 2001 and 2000 was $5.5 million and $5.2 million, respectively.
     During 2001, the company implemented a value based Long Term Incentive Plan (LTIP), which is designed to reward the company’s executive officers by means of cash performance awards and stock options as shareholder value increases. The cash performance portion of the LTIP measures and rewards value-added performance over three-year periods. The performance measure is based on total business return, a measure of the creation of economic value in the company’s business. At December 31, 2001, the company’s liability under this plan for cash awards was $.3 million.

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Postretirement Benefits
The company currently provides certain health care and life insurance benefits for retired employees and their dependents. Substantially all employees become eligible for these benefits if they reach retirement age while still working for the company and have at least ten years of service. Company contributions toward these benefits have been projected as fixed amounts per participant not to exceed 175% of its 1993 per capita costs. Election of health care and life insurance benefit coverage for retirees and dependents is optional, and requires contributions by the retiree towards the cost of coverage. The company reserves the right to change or terminate all employee benefits, including postretirement benefits.
     A reconciliation of benefit obligations and the funded status and the accrued benefit liability is presented below.

Reconciliation of Benefit Obligation, and the Funded Status and Accrued Benefit Liability

Dollars in thousands		2001			2000
Reconciliation of projected benefit obligation (Actuarial present value of future benefits)
Projected benefit obligation at January 1		$	16,385		$	14,301
Service cost–benefits earned during the year			517			438
Interest cost on projected benefit obligation			1,222			1,070
Actuarial loss during the year			1,186			2,121
Benefits paid			(2,874	)		(2,536	)
Participant contributions			933			991
	Projected benefit obligation at December 31	$	17,369		$	16,385
Funded status and accrued benefit liability at December 31
Projected benefit obligation, unfunded		$	17,369		$	16,385
Unrecognized net transition obligation cost			(5,255	)		(5,733	)
Unrecognized net actuarial loss			(7,789	)		(6,917	)
	Accrued benefit liability	$	4,325		$	3,735

     The components of the annual net benefit cost are presented below.

Components of Net Benefit Cost

Dollars in thousands		2001		2000		1999
Service cost – benefits earned during the year		$	517	$	438	$	384
Interest cost on the projected benefit obligation			1,222		1,070		912
Amortization of transition obligation			478		478		478
Amortization of net actuarial loss			396		216		86
	Net benefit cost	$	2,613	$	2,202	$	1,860

     For measurement purposes, annual rates of future increases in the company’s per capita cost of covered health care benefits were assumed to be 7% for 2002 and 4.5% for 2003. During 2003, it is projected that the plan will reach the company’s contribution cap, which is defined as, 175% of its 1993 per capita cost.
     The discount rate assumption was 7.25% at December 31, 2001 and 7.75% at December 31, 2000 and 1999. The rate of future compensation increases has no impact on the plan. The return on plan assets is not applicable since the plan is unfunded and benefits are paid as claims are submitted.
     Assumed health care trend rates can have a significant effect on the amounts reported for the health care plans. However, since the plan has capped the company’s cost at 175% of its 1993 per capita cost, the effect on the company is not material. A 1% change in assumed health care cost trend rates would have the following effects:

Dollars in thousands	1% Increase		1% Decrease
Effect on total of service and interest cost   components of net annual benefit cost	$	72	$	(69	)
Effect on the health care component of   the projected benefit obligation	$	246	$	(244	)

Stock Option Plans

The company records stock compensation in accordance with Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees” (APB 25). Under APB 25, no charges are made to earnings in accounting for stock options granted because all options are granted with an exercise price equal to the fair market value at the date of grant. If the amounts received when options are exercised are different than the carrying value of treasury stock issued, the difference is recorded in retained earnings.
     Stock options are presently outstanding under the Stock Incentive Plans of 1996 and 1987. The 1996 Plan covering 600,000 shares was approved in April 1996. The 1987 plan was terminated upon the approval of the 1996 plan except for outstanding stock options.

Stock Options Recap at December 31,

Number of shares	2001		2000		1999
Granted and exercisable		509,500		519,250		265,249
Authorized, unissued, and available for future grant		118,699		94,199		119,979

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Notes to Consolidated Financial Statements

Butler Manufacturing Company

     Nonqualified stock options were granted by the company in 2000 and 1999 to key employees under the 1996 plan. There were no options granted in 2001. Options are granted at a fixed exercise price based upon the fair market value on the date of the grant and expire no more than 10 years from the date of grant. Options granted in 2000 and 1999 vest one year after the date of grant and expire five years from the date of grant. Below is a summary of stock option activity for the three years ended December 31, 2001.

Summary of Stock Option Activity

	2001			2000			1999
			Weighted-average			Weighted-average			Weighted-average
	Shares		Exercise Price	Shares		Exercise Price	Shares		Exercise Price
Outstanding at beginning of year	550,750		$28.59	542,249		$28.70	378,516		$25.72
Granted	–		–	31,500		$23.00	278,000		$26.00
Exercised	(16,750	)	$  9.26	(9,999	)	$11.67	(108,267	)	$11.11
Forfeited	(24,500	)	$30.81	(13,000	)	$32.39	(6,000	)	$33.44
Outstanding at end of year	509,500		$29.11	550,750		$28.59	542,249		$28.70

A summary of outstanding and exercisable options is shown below.

Stock Options Outstanding and Exercisable at December 31, 2001

		Options Outstanding		Options Exercisable
Range of	Number	Remaining	Weighted-Average	Number	Weighted-Average
Exercise Prices	Outstanding	Life in Years	Exercise Price	Exercisable	Exercise Price
$26.00	270,000	2.1	$26.00	270,000	$26.00
$32.19 - 35.88	119,000	1.2	$32.70	119,000	$32.70
$38.75	77,000	.3	$38.75	77,000	$38.75
$10.33 - 23.00	43,500	2.8	$21.47	43,500	$21.47
Total or weighted average	509,500	1.7	$29.11	509,500	$29.11

     Since the company applies APB 25 in accounting for its plans, no compensation cost has been recognized for stock options in net income. Stock-based compensation cost if recorded under Statement of Financial Accounting Standard No. 123, “Accounting for Stock-Based Compensation”, would have decreased the company’s net income and earnings per share by $0.1 million and $.02 per share in 2000, and $1.3 million and $.18 per share in 1999.
     The company uses the Black Scholes option pricing model to calculate the fair value of stock options on their date of grant. The fair value per share of stock options granted was $5 in 2000 and $8 in 1999. The following assumptions were used:

Assumption	2001	2000	1999
Dividend yield	N/A	2.6%	2.3%
Risk-free interest rate	N/A	5.1%	6.6%
Volatility	N/A	25%	34%
Life of option	N/A	5 years	5 years

     The company did not grant stock options during 2001.

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Treasury Stock Activity

Thousands of dollars	2001			2000			1999
Balance, January 1	$	65,543		$	51,200		$	40,919
Purchases		279			15,121			13,093
Issues		(871	)		(778	)		(2,812	)
Balance, December 31	$	64,951		$	65,543		$	51,200

     As a result of options exercised and the issuance of treasury stock, the company recognized a tax benefit of $.1 million, $.1 million, and $.5 million in 2001, 2000, and 1999, respectively, which was credited directly to retained earnings.

(Number of shares)	2001			2000			1999
Balance, January 1		2,832,338			2,211,646			1,806,202
Purchases		12,730			654,300			527,321
Issues		(37,651	)		(33,608	)		(121,877	)
Balance, December 31		2,807,417			2,832,388			2,211,646
Average cost at December 31	$	23.14		$	23.14		$	23.15

Quarterly Financial Information (Unaudited)

Thousands of dollars, except share amounts

	Quarter Ended
2001	March 31			June 30			Sept. 30		Dec. 31		Annual
Net Sales	$	194,859		$	213,672		$	249,676	$	238,365	$	896,572
Gross profit		24,765			33,658			40,906		37,912		137,241
Net earnings (loss)		(2,685	)		3,307			5,928		1,510		8,060
Basic earnings (loss) per share	$	(0.43	)	$	0.53		$	0.94	$	0.24	$	1.28
Diluted earnings (loss) per share	$	(0.43	)	$	(0.54	)	$	0.94	$	0.24	$	1.28
Dividends  declared per share	$	.17		$	.17		$	.18	$	.18	$	.70

     Annual earnings per share for 2001 do not equal the sum of the quarterly earnings per share because of the timing of net earnings and the company’s purchase of common shares during the year. The first and second quarter net earnings were restated to reflect the accounting method change for determination of the company’s net pension expense.

	Quarter Ended
2000	March 31		June 30		Sept. 30		Dec. 31		Annual
Net Sales	$	219,189	$	244,036	$	249,671	$	247,481	$	960,377
Gross profit		34,714		42,157		47,231		44,621		168,723
Net earnings		2,215		6,643		9,431		6,926		25,215
Basic earnings per share	$	.33	$	1.01	$	1.47	$	1.09	$	3.87
Diluted earnings per share	$	.33	$	1.01	$	1.47	$	1.09	$	3.86
Dividends  declared per share	$	.16	$	.16	$	.17	$	.17	$	.66

     Annual earnings per share for 2000 do not equal the sum of the quarterly earnings per share because of the timing of net earnings and the company’s purchase of common shares during the year.

Price Range of Common Stock (Unaudited)

The company’s common stock is traded on the New York Stock Exchange. The table below presents the high and low trading prices as reported by the exchange.

	2001		2000
	High	Low	High	Low
First quarter	$28.00	$22.80	$25.94	$21.63
Second quarter	$28.75	$22.25	$25.63	$17.00
Third quarter	$25.90	$21.30	$23.00	$17.00
Fourth quarter	$27.97	$21.50	$25.69	$22.00
Range for the year	$28.75	$21.30	$25.94	$17.00
Year-end closing price:	Year	Close
	2001	$27.70
	2000	$25.31
	1999	$22.31

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Historical Review (2001–1997)

Butler Manufacturing Company

			Year ended December 31,
Thousands of dollars, except share amounts			2001		2000		1999		1998		1997
Income Statement Data
Net sales			$	896,572	$	960,377	$	973,153	$	962,163	$	924,646
	Net earnings			8,060		25,215		25,834		6,979		34,384
	As a percent of sales			.9%		2.6%		2.7%		.7%		3.7%
	As a percent of average    shareholders’ equity			4.9%		15.5%		16.7%		4.6%		24.5%
Per share of common stock:
	Basic earnings		$	1.28	$	3.87	$	3.66	$	.92	$	4.48
	Diluted earnings			1.28		3.86		3.63		.92		4.43
	Cash dividends declared			.70		.66		.62		.58		.52
	Cash dividends paid			.69		.65		.61		.57		.50
Financial Position At Year End
Assets
	Current assets		$	275,067	$	291,770	$	270,988	$	253,500	$	233,323
	Property, plant, and equipment, net			143,270		117,396		94,051		97,704		96,339
	Total assets			470,762		447,998		405,857		393,893		374,972
Working capital
	Net working capital		$	83,523	$	78,861	$	96,014	$	92,370	$	68,819
	Ratio of current assets to current liabilities			1.4		1.4		1.5		1.6		1.4
Financial structure
	Long-term debt, less current maturities		$	98,244	$	53,298	$	57,021	$	62,901	$	33,918
	Total debt			103,861		58,861		62,697		68,733		39,780
	Shareholders’ equity			164,475		165,716		159,550		150,188		156,566
		Per common share, year end		26.19		26.49		23.20		20.62		20.50
	Total debt as a percent of total capital			39%		26%		28%		31%		20%
General Statistics
Depreciation and amortization			$	18,104	$	15,594	$	19,972	$	14,923	$	12,474
Capital expenditures			$	44,583	$	36,938	$	13,634	$	14,800	$	30,249
Basic shares outstanding, average				6,282		6,521		7,064		7,553		7668
Diluted shares outstanding, average				6,285		6,531		7,111		7,612		7,754
Common shares outstanding, year end				6,281		6,256		6,877		7,282		7,637
Common shareholders, year end				2,015		2,066		2,599		2,210		2,310
Number of employees, year end				4,719		5,079		4,912		5,171		5,117

1. In thousands except per share amounts for common stock and the number of shareholders and employees.
2. Excluding special charges of $3.6 million, or $.58 per share, net earnings were $11.7 million or $1.86 per share for 2001.
3. Excluding one-time items which increased net earnings by $2.3 million, or $.33 per share, net earnings were $23.5 million, or $3.30 per share in 1999.
4. Excluding special charges of $10.7 million or $1.41 per share, net earnings were $17.7 million, or $2.33 per share in 1998.
5. Excluding the gain on the sale of the Grain Systems division of $13.3 million or $1.72 per share, net earnings were $21.1 million, or $2.71 per share in 1997.

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EX-3.2

Bylaws as amended

EX-10.13

Summary of Long Term Incentive Plan

EX-24.1

Power of Attorney

EX-99.1

Audit Assurance Letter

EX-13

Untitled Document