-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IHfGjZOeWTTWQKvUCs3PPf/HLcYSuRPmWMI4RCDNtFYuMbJ9TuumxEdnY4LuoGAA EaJKJMqPx+aMzsUN8905FA== 0000057187-96-000003.txt : 19960517 0000057187-96-000003.hdr.sgml : 19960517 ACCESSION NUMBER: 0000057187-96-000003 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960515 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: LACLEDE STEEL CO /DE/ CENTRAL INDEX KEY: 0000057187 STANDARD INDUSTRIAL CLASSIFICATION: STEEL WORKS, BLAST FURNACES ROLLING MILLS (COKE OVENS) [3312] IRS NUMBER: 430368310 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-03855 FILM NUMBER: 96567116 BUSINESS ADDRESS: STREET 1: ONE METROPOLITAN SQ CITY: ST LOUIS STATE: MO ZIP: 63102 BUSINESS PHONE: 3144251400 MAIL ADDRESS: STREET 1: ONE METROPOLITAN SQ CITY: ST LOUIS STATE: MO ZIP: 63102 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 [X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1996 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 0-3855 LACLEDE STEEL COMPANY (Exact name of Registrant as specified in its charter) Delaware 43-0368310 (State or other jurisdiction of I.R.S. Employer incorporation or organization) Identification No. One Metropolitan Square, St. Louis, Missouri 63102 (Address of principal executive offices) (Zip code) 314-425-1400 (Registrant's telephone number, including area code) (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No As of April 30, 1996 there were 4,056,140 shares of $13.33 par value common stock outstanding. LACLEDE STEEL COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS (In Thousands Except Per Share Data) First Quarter Ended March 31, 1996 1995 Net sales 80,975 87,327 Costs and expenses: Cost of products sold 76,058 76,115 Selling, general and administrative 3,452 3,629 Depreciation 1,991 1,916 Interest expense, net 2,765 2,177 Total costs and expenses 84,266 83,837 Earnings (loss) before income taxes (3,291) 3,490 Provision (credit) for income taxes (1,260) 1,396 Net earnings (loss) (2,031) 2,094 Retained earnings (deficit) at beginning (2,315) 7,822 Retained earnings (deficit) at end of per (4,346) 9,916 Net earnings (loss) per share (0.50) 0.52 - 1 - LACLEDE STEEL COMPANY AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS ASSETS (In Thousands) Mar. 31, Dec. 31, 1996 1995 Current Assets: Cash and cash equivalents 151 161 Accounts receivable, less allowances 41,861 37,287 Prepaid expenses 327 744 Income taxes recoverable -- 1,479 Inventories: Finished 56,938 56,377 Semi-finished 32,303 28,683 Raw materials 9,345 8,415 Supplies 13,673 13,807 Total inventories 112,259 107,282 Total Current Assets 154,598 146,953 Non-Current Assets: Intangible pension asset 16,909 17,409 Other intangible assets 2,371 2,407 Bond funds in trust 2,385 2,385 Prepaid pension contributions 8,095 6,586 Deferred income taxes 45,243 44,062 Other 3,808 3,785 Total Non-Current Assets 78,811 76,634 Plant and Equipment, at cost 247,234 243,573 Less - accumulated depreciation 119,239 117,382 Net Plant and Equipment 127,995 126,191 Total Assets 361,404 349,778 - 2 - LIABILITIES AND STOCKHOLDERS' EQUITY Mar. 31, Dec. 31, 1996 1995 Current Liabilities: Accounts payable 39,283 31,617 Accrued compensation 6,924 7,667 Current portion of long-term debt 2,459 2,459 Accrued costs of pension plans 15,449 15,449 Other 2,413 2,002 Total Current Liabilities 66,528 59,194 Non-Current Liabilities: Accrued costs of pension plans 67,038 67,123 Accrued postretirement medical benefits 81,556 81,431 Other 6,610 6,721 Total Non-Current Liabilities 155,204 155,275 Long-Term Debt: Bank revolving credit 91,293 84,541 Bank term loan 6,422 6,780 Revenue bonds 25,470 25,470 Other 2,000 2,000 Total Long-Term Debt 125,185 118,791 Stockholders' Equity: Preferred stock, without par value, authorized 2,000,000 shares with none issued -- -- Common stock, $13.33 par value, authorized 5,000,000 shares with 4,056,140 shares issued 54,081 54,081 Capital in excess of par value 247 247 Retained earnings (deficit) (4,346) (2,315) Minimum pension liability adjustment (35,495) (35,495) Total Stockholders' Equity 14,487 16,518 Total Liabilities and Stockholders' Equity 361,404 349,778 - 3 - LACLEDE STEEL COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands) Three Months Ended March 31, 1996 1995 Cash flows from operating activities: Net earnings (loss) (2,031) 2,094 Adjustments to reconcile net earnings (loss) to net cash used in operating activities: Depreciation 1,991 1,916 Change in deferred income taxes (1,181) 825 Accrued pension cost 2,655 1,949 Pension cash funding (3,749) (2,701) Undistributed minority interest 19 -- Changes in assets and liabilities that provided (used) cash: Accounts receivable (4,574) 305 Inventories (4,977) (6,158) Accounts payable and accrued expenses 9,100 (5,541) Accrued postretirement medical benefits 125 (103) Other assets and liabilities 13 199 Net cash used in operating activities (2,609) (7,215) Cash flows used in investing activities: Capital expenditures (3,795) (2,391) Cash flows from financing activities: Net borrowings under revolving credit 6,752 10,124 Payments on long-term debt (358) (403) Payment of financing costs -- (115) Net cash provided by financing activities 6,394 9,606 Cash and cash equivalents: Net increase (decrease) during the period (10) -- At beginning of year 161 159 At end of period 151 159 - - 4 - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 - GENERAL The accompanying unaudited consolidated financial statements include the accounts of Laclede Steel Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. The consolidated financial statements reflect all adjustments (such adjustments are of a normal recurring nature unless otherwise disclosed in these interim financial statements) which are in the opinion of Management necessary for a fair statement of the results for the interim periods. NOTE 2 - EARNINGS PER SHARE Earnings per share have been calculated based on weighted average shares outstanding of 4,056,140. NOTE 3 - INCOME TAXES The provision for income taxes represents effective combined federal and state tax rates of 38% and 40% for the three months ended March 31, 1996 and 1995, respectively. The financial results for 1996 are subject to annual audit. - 5 - ITEM 2. MANAGEMENT'S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Liquidity and Capital Resources In the first quarter of 1996 operating activities used $2.6 million in cash. Capital expenditures were $3.8 million, and contributions to Company pension plans totaled $3.7 million. Increases in accounts receivable and inventory during the period, which totaled $9.6 million, were largely offset by increases in accounts payable and accrued expenses. Net working capital increased slightly in the quarter to $88.1 million, and the ratio of current assets to current liabilities was 2.3 to 1.0 at March 31, 1996. At March 31, 1996, $91.3 million in borrowings were outstanding under the Company's Revolving Credit Facility. Approximately $3.4 million was available under this Agreement at March 31, 1996, after deducting $2.7 million in outstanding letters of credit. The Company is negotiating with its principal lenders an extension of $5.0 million in availability under its Revolving Credit Facility due to expire by September 30, 1996, and a modification to certain financial covenants in its Loan and Security Agreement relating to operating losses and net worth. During the last nine months of 1996 the Company anticipates capital expenditures of $6.2 million, and contributions to pension plans of $12.2 million. Based on current projections, normal operating activities will not generate sufficient cash flow to finance these expenditures. Therefore, the Company expects to supplement funds available under the Loan and Security Agreement with certain equipment financing arrangements, and to significantly improve cash flow from operating activities through reductions in inventory over the balance of the year. If modifications to the Loan and Security Agreement mentioned above are agreed to by the Lenders, Management projections indicate that internally generated funds, including the effect of inventory reductions, together with planned financing arrangements should be adequate to finance planned capital expenditures and maintain liquidity. Actual results can differ materially from projections, depending upon levels of demand, sales prices and levels of productivity. Results of Operations Net sales decreased by $6.4 million or 7.3% in the first quarter of 1996 compared to the first quarter of 1995, reflecting a 13% decrease in the average selling price for steel products. Total steel shipments increased 4% and shipments of Laclede Chain Manufacturing Co. increased 25%. Cost of products sold did not increase in the 1996 quarter, despite higher steel and chain shipments, primarily as a result of changes in product mix. Sales of lower cost semi-finished steel, which were relatively minor in the first quarter of 1995, represented about 14% of 1996 steel shipments. - 6 - The increase in interest expense in the first quarter of 1996 is the result of an increase in bank borrowings and an increase in the average interest rate of 60 basis points. PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS. None ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits (4)(a) Registrant's Loan and Security Agreement dated as of September 7, 1994. (Incorporated by reference to Exhibit (4)(a) in Registrant's quarterly report on Form 10-Q for September 30, 1994.) (4)(b) First Amendment dated February 15, 1995 to Registrant's Loan and Security Agreement. (Incorporated by reference to Exhibit (4)(b) in Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1994.) (4)(c) Second Amendment dated May 10, 1995 to Registrant's Loan and Security Agreement. (Incorporated by reference to Exhibit (4)(c) in Registrant's Quarterly Report on Form 10-Q for the period ended September 30, 1995.) (4)(d) Third Amendment dated June 1, 1995 to Registrant's Loan and Security agreement. (Incorporated by reference to Exhibit (4)(c) in Registrant's Quarterly Report on Form 10-Q for the period ended September 30, 1995.) (4)(e) Fourth Amendment dated December 7, 1995 to Registrant's Loan and Security Agreement. (Incorporated by reference to Exhibit (4)(e) in Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1995.) (4)(f) Fifth Amendment dated January 26, 1996 to Registrant's Loan and Security Agreement. (Incorporated by reference to Exhibit (4)(f) in Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1995.) Instruments with respect to long-term debt issues have been omitted where the amount of securities authorized under such instruments does not exceed 10% of the total consolidated assets of the Registrant. Registrant hereby agrees to furnish a copy of any such instrument to the Commission upon its request. (b) Reports on Form 8-K. No reports on Form 8-K have been filed during the quarter. - 7 - SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. LACLEDE STEEL COMPANY (Registrant) /s/ Michael H. Lane Michael H. Lane Vice President - Finance Treasurer and Secretary Duly Authorized Officer and Principal Financial Officer Date: May 15, 1996 EX-27 2
5 1,000 DEC-31-1996 JAN-1-1996 MAR-31-1996 3-MOS 151 0 44,141 2,280 112,259 154,598 247,234 119,239 361,404 66,528 125,185 0 0 54,081 (39,594) 361,404 80,975 80,975 76,058 78,030 3,452 33 2,765 (3,291) (1,260) (2,031) 0 0 0 (2,031) (0.50) (0.50)
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