-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, a7V5L4CT/5zTxrO5eGUQaaeM8R+c48ZFaKMaxo72/sOTcUrHxgm/6CzAOd9cGmRe bjjYaQuqMnFsM5z9LZjmxQ== 0000830260-95-000012.txt : 19950814 0000830260-95-000012.hdr.sgml : 19950814 ACCESSION NUMBER: 0000830260-95-000012 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19950630 FILED AS OF DATE: 19950811 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: OREGON STEEL MILLS INC CENTRAL INDEX KEY: 0000830260 STANDARD INDUSTRIAL CLASSIFICATION: STEEL WORKS, BLAST FURNACES ROLLING MILLS (COKE OVENS) [3312] IRS NUMBER: 940506370 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-09887 FILM NUMBER: 95561733 BUSINESS ADDRESS: STREET 1: 1000 BROADWAY BLDG STREET 2: 1000 S W BROADWAY, SUITE 2200 CITY: PORTLAND STATE: OR ZIP: 97205 BUSINESS PHONE: 5032239228 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON DC 20549 FORM 10-Q /X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1995 --------------------------------------- OR / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to --------------------- --------------- Commission File Number 1-9887 ------------------ OREGON STEEL MILLS, INC. (Exact name of registrant as specified in its charter) Delaware 94-0506370 - ---------------------------------------------------------------------- (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) 1000 Broadway Building, Suite 2200, Portland, Oregon 97205 - ---------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (503) 223-9228 - ---------------------------------------------------------------------- (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 Sections 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 ----- ----- APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Common Stock, $.01 Par Value 19,421,643 ---------------------------- ----------------------------- Class Number of Shares Outstanding (as of July 31, 1995) OREGON STEEL MILLS, INC. INDEX Page ---- PART I. FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets June 30, 1995 (unaudited) and December 31, 1994 . . . . . . . . . 2 Consolidated Statements of Income (unaudited) Three months and six months ended June 30, 1995 and 1994 . . . . . . . . . . 3 Consolidated Statements of Cash Flows (unaudited) Six months ended June 30, 1995 and 1994 . . . . . . . . . . . . . . . . . 4 Notes to Consolidated Financial Statements (unaudited) . . . . . . . . . . . 5 - 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . . . . . . 7 - 10 PART II. OTHER INFORMATION Item 1. Legal Proceedings . . . . . . . . . . . . . . . 11 Item 6. Exhibits and Reports on Form 8-K. . . . . . . . 11 SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . 11 1 OREGON STEEL MILLS, INC. CONSOLIDATED BALANCE SHEETS (In thousands) June 30, 1995 December 31, (Unaudited) 1994 ----------- ------------ ASSETS Current assets: Cash and cash equivalents $ 184 $ 5,039 Trade accounts receivable, net 70,587 80,203 Inventories 137,656 160,788 Other current assets 6,013 7,661 Deferred tax asset 5,775 5,775 -------- --------- Total current assets 220,215 259,466 -------- --------- Property, plant and equipment: Land and improvements 28,494 28,319 Buildings 37,059 36,943 Machinery and equipment 286,424 230,019 Construction in progress 148,365 139,842 -------- -------- 500,342 435,123 Accumulated depreciation (105,155) (97,027) -------- -------- 395,187 338,096 -------- -------- Excess of cost over net assets acquired 42,089 42,569 Other assets 32,745 25,602 -------- -------- $690,236 $665,733 ======== ======== LIABILITIES Current liabilities: Current portion of long-term debt $ 4,274 $ 5,302 Accounts payable 81,783 85,618 Accrued expenses 36,304 24,692 Other taxes payable 2,922 2,374 -------- -------- Total current liabilities 125,283 117,986 Long-term debt 199,507 187,935 Deferred employee benefits 17,422 17,661 Other deferred liabilities 36,177 36,609 Deferred income taxes 13,247 10,725 -------- -------- 391,636 370,916 -------- -------- Minority interests 18,903 18,934 -------- -------- STOCKHOLDERS' EQUITY Common stock 194 194 Additional paid-in capital 150,826 150,090 Retained earnings 132,369 130,145 -------- -------- 283,389 280,429 Cumulative foreign currency translation adjustment (3,692) (4,546) -------- -------- 279,697 275,883 -------- -------- $690,236 $665,733 ======== ======== The accompanying notes are an integral part of the consolidated financial statements. 2 OREGON STEEL MILLS, INC. CONSOLIDATED STATEMENTS OF INCOME (In thousands, except tonnage and per share amounts) (Unaudited)
Three Months Ended June 30, Six Months Ended June 30, --------------------------- ------------------------- 1995 1994 1995 1994 -------- -------- -------- -------- Revenues: Sales $151,148 $234,804 $338,165 $453,669 Proceeds from insurance settlement 3,959 - 3,959 - -------- -------- -------- -------- Total revenues 155,107 234,804 342,124 453,669 Costs and expenses: Cost of sales 131,380 213,406 301,658 411,562 Selling, general and administrative expenses 10,422 13,604 21,251 25,910 Contribution to employee stock ownership plan 334 251 668 501 Profit participation 1,991 401 2,726 1,052 -------- -------- -------- -------- Operating income 10,980 7,142 15,821 14,644 Other income (expense): Interest and dividend income 57 115 125 248 Interest expense (2,240) (1,398) (4,123) (2,443) Other, net 458 296 608 252 Minority interests 162 (609) 66 (1,207) -------- -------- -------- -------- Income before income taxes 9,417 5,546 12,497 11,494 Income tax expense 3,671 2,107 4,841 4,368 -------- -------- -------- -------- Net income $ 5,746 $ 3,439 $ 7,656 $ 7,126 ======== ======== ======== ======== Primary and fully diluted net income per common and common equivalent share $.29 $.17 $.38 $.36 Dividends declared per common share $.14 $.14 $.28 $.28 Weighted average common shares and common share equivalents outstanding 20,020 19,976 20,013 19,971 Tonnage sold 277,200 467,000 672,300 889,000 The accompanying notes are an integral part of the consolidated financial statements. 3 /TABLE OREGON STEEL MILLS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) Six Months Ended June 30, ------------------------- 1995 1994 -------- -------- Cash flows from operating activities: Net income $ 7,656 $ 7,126 Adjustments to reconcile net income to net cash provided (used) by operating activities: Depreciation 10,414 10,597 Amortization 687 668 Deferred income tax provision 2,522 2,960 Accrual for contribution of common stock to employee stock ownership plan 667 500 Minority interests (30) 1,148 Other, net (1,846) 1,016 Changes in current assets and liabilities, net 40,977 (43,064) ------- -------- NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES 61,047 (19,049) ------- -------- Cash flows from investing activities: Additions to property, plant and equipment (70,644) (55,956) Other, net (420) (20) ------- -------- NET CASH USED BY INVESTING ACTIVITIES (71,064) (55,976) ------- -------- Cash flows from financing activities: Net borrowings under revolving loan agreements 2,807 79,655 Borrowings from Senior Credit Facilities 10,000 - Payments of other debt (2,358) (1,992) Dividends paid (5,432) (5,421) Other, net (59) 197 ------- -------- NET CASH PROVIDED BY FINANCING ACTIVITIES 4,958 72,439 ------- -------- Effects of foreign currency exchange rate changes on cash 204 (20) ------- -------- Net decrease in cash and cash equivalents (4,855) (2,606) Cash and cash equivalents at beginning of period 5,039 9,623 ------- -------- Cash and cash equivalents at end of period $ 184 $ 7,017 ======= ======== Supplemental disclosures of cash flow information: Cash paid for: Interest $9,277 $4,406 Income taxes $ 505 $3,940 NON-CASH OPERATING, INVESTING AND FINANCING ACTIVITIES: At June 30, 1995 and June 30, 1994, the Company had financed property, plant and equipment with accounts payable of $19.9 million and $13.4 million, respectively. The accompanying notes are an integral part of the consolidated financial statements. 4 OREGON STEEL MILLS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Basis of Presentation --------------------- The consolidated financial statements include the accounts of Oregon Steel Mills, Inc. and its subsidiaries (the "Company"). All significant intercompany balances and transactions have been eliminated upon consolidation. Certain previously reported amounts have been reclassified to conform with current period presentation. The unaudited financial statements include all adjustments (consisting of normal recurring accruals) which, in the opinion of management, are necessary for a fair presentation of the interim periods. Results for an interim period are not necessarily indicative of results for a full year. Reference should be made to the Company's 1994 Annual Report on Form 10-K for additional disclosures including a summary of significant accounting policies. 2. Inventories ----------- Inventories consist of: June 30, December 31, 1995 1994 -------- ------------ (In thousands) Raw materials $ 15,473 $ 37,389 Semi-finished product 47,211 50,033 Finished product 53,798 50,320 Stores and operating supplies 21,174 23,046 -------- --------- $137,656 $160,788 ======== ========= 3. Common Stock ------------ In February 1995 the Company contributed approximately 44,300 shares of common stock of the Company ("Common Stock") to the Employee Stock Ownership Plan (the "ESOP") in payment of a $736,000 liability accrued in 1994. In February 1994 the Company contributed approximately 29,600 shares of Common Stock to the ESOP in payment of a $753,000 liability accrued in 1993. On July 27, 1995, the Board of Directors declared a quarterly cash dividend of 14 cents per share to be paid August 31, 1995, to stockholders of record as of August 11, 1995. 4. Contingencies ------------- ENVIRONMENTAL. The Company's Napa Pipe Corporation subsidiary has a reserve of $2.7 million at June 30, 1995 for environmental remediation relating to the Napa pipe mill. The Company's 90 percent owned New CF&I, Inc. subsidiary owns a 95.2 percent interest in a Pueblo, Colorado steel mill, CF&I Steel, L.P. ("CF&I"). In connection with CF&I's acquisition of certain assets from CF&I Steel Corporation in 1993, CF&I established a reserve of $36.7 million for environmental remediation. At June 30, 1995, CF&I has a reserve of $36 million, of which $34 million is classified as non-current in other deferred liabilities in the consolidated balance sheet. 5 OREGON STEEL MILLS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) (Unaudited) 5. Commitments ----------- During 1994 the Company began construction of various capital improvement projects at both its Portland, Oregon and Pueblo, Colorado steel mills. Commitments for expenditures related to the completion of these projects were $69.9 million at June 30, 1995. 6. Proceeds From Insurance Settlement ---------------------------------- During the second quarter of 1995, the Company received insurance proceeds of approximately $4 million as reimbursement of lost profits resulting from lost production and start-up delays of CF&I's rod/bar mill caused by an explosion that occurred during the third quarter of 1994. 6 OREGON STEEL MILLS, INC. Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS General - ------- The consolidated financial statements include the accounts of Oregon Steel Mills, Inc. and its wholly-owned and majority-owned subsidiaries (the "Company"), Napa Pipe Corporation ("Napa"), Oregon Steel Mills - Fontana Division, Inc. ("Fontana"), Camrose Pipe Corporation ("CPC") which owns a 60 percent interest in Camrose Pipe Company ("Camrose"), 90 percent owned New CF&I, Inc. which owns a 95.2 percent interest in CF&I Steel, L.P. ("CF&I"), and certain other insignificant subsidiaries. Fontana ceased production in the fourth quarter of 1994 and closed permanently in the first quarter of 1995. Results of Operations - --------------------- The following table sets forth tonnage sold, sales revenues and average selling price per ton by division: Three Months Ended, Six Months Ended, June 30, June 30, ------------------- ----------------- 1995 1994 1995 1994 ------ ------ ------ ------ Total tonnage sold: Oregon Steel Division (1): Plate products 73,200 116,300 165,100 208,300 Welded pipe products 53,900 145,000 107,200 274,800 Semi-finished products 43,300 1,400 101,000 1,400 CF&I Steel Division 106,800 204,300 299,000 404,500 ------- ------- ------- ------- Total 277,200 467,000 672,300 889,000 ======= ======= ======= ======= Sales revenues (in thousands): Oregon Steel Division $ 92,970 $144,878 $192,300 $274,156 CF&I Steel Division 58,178 89,926 145,865 179,513 -------- -------- -------- -------- Total $151,148 $234,804 $338,165 $453,669 ======== ======== ======== ======== Average selling price per ton: Oregon Steel Division $546 $551 $515 $566 CF&I Steel Division $545 $440 $488 $444 Average $545 $503 $503 $510 - --------------------------------- (1) The Oregon Steel Division consists primarily of the operations of the Portland, Oregon steel mill, Napa, Fontana and Camrose. The consolidated average selling price increased $42 to $545 per ton for the second quarter of 1995 and decreased $7 to $503 per ton for the first six months of 1995, compared to the corresponding 1994 periods. The primary reasons for the changes in the consolidated average selling prices were the increased volume of sales of the generally lowest priced semi-finished products and the decreased volume of sales of the generally highest priced welded pipe products sold by the Oregon Steel Division, offset by a significant reduction in the sales volume of the CF&I Steel Division's lowest priced rod and bar products. In addition, selling prices generally increased in the second quarter and the first six months of 1995, compared to the corresponding periods in 1994 due to favorable market conditions and improved quality resulting from capital facility improvements. However, Oregon Steel Division's Canadian Camrose pipe mill was negatively impacted by a significant reduction in demand for its pipe products in the second quarter of 1995. 7 OREGON STEEL MILLS, INC. Consolidated tonnage sold decreased 189,800 tons to 277,200 tons for the second quarter of 1995 and decreased 216,700 tons to 672,300 tons for the first six months of 1995, compared to the corresponding 1994 periods. These tonnage decreases were primarily the result of reduced welded pipe shipments from the Napa and Camrose pipe mills, reduced rod and bar shipments from the CF&I Steel Division, offset by increased semi-finished product shipments from the Portland steel mill. The Company was able to maximize the efficiency of its Portland steel mill by utilizing its excess hot metal capacity by producing and selling semi-finished products in the first six months of 1995. The Company expects to continue selling semi-finished products for the balance of 1995 and into 1996 until the Portland steel mill's combination mill comes on line. Reduced rod and bar mill tonnage for the three and six month periods ended June 30, 1995 is primarily due to the capitalization of revenues and costs associated with the pre- operational phase of CF&I's new rod/bar mill. The Company estimates the new rod/bar mill to be fully operational during the third quarter of 1995. As a result of the decreased sales volume and changes in average selling prices, sales revenues for the three and six month periods ended June 30, 1995 were $151.1 million and $338.2 million, respectively, compared to $234.8 million and $453.7 million for the corresponding 1994 periods. Of the $83.7 million second quarter sales revenue decrease, $95.4 million was the result of a volume decrease, offset by $11.7 million resulting from higher average selling prices. Of the $115.5 million year-to-date sales revenue decrease, $110.5 million was the result of a volume decrease, and $5 million resulted from lower average selling prices. Gross profit for the three and six month periods ended June 30, 1995, increased $2.3 million and decreased $1.6 million from the corresponding 1994 periods to $23.7 million and $40.5 million, respectively. Gross profit as a percentage of revenues for the three and six month periods ended June 30, 1995 increased 6.2 percent and 2.5 percent, respectively, to 15.3 percent and 11.8 percent. The $2.3 million quarterly increase resulted from a $7.1 million positive average margin variance and a $4 million insurance settlement, offset by a $8.8 million negative volume variance. The $1.6 million year-to- date decrease resulted from a $10.3 million negative volume variance, offset by a $4.7 million positive average margin variance and a $4 million insurance settlement. Gross profits were positively impacted by the $4 million proceeds received from the Company's business interruption insurance carrier in the second quarter of 1995 primarily for reimbursement of lost profits at the CF&I Steel Division due to lost production and the delay in the start-up of the new rod/bar mill. The delay was caused by an explosion that occurred during the third quarter of 1994. Gross profits were negatively impacted by the extension of start-up of the capital projects at the Company's CF&I Steel Division beyond the original time table. The associated incremental costs were estimated to be $1.2 million and $3.8 million more in the second quarter and the first half of 1995, respectively, than the corresponding periods in 1994. Gross profits also improved, in the second quarter and first half of 1995 compared to the corresponding periods in 1994, due to higher selling prices as discussed above, and due to a somewhat greater percentage of sales of higher margin specialty steel plate to total sales of all grades of steel plate. Additionally, gross profits improved because CF&I Steel Division's lowest margin rod and bar product sales were only 1.6 and 23.6 percent of total CF&I Steel Division sales in the second quarter of 1995 and the first half of 1995 compared to 41.3 and 41.5 percent in the corresponding periods in 1994. Further, gross profits improved because the current periods were not burdened with higher manufacturing costs and sales allowances associated with producing and selling high quality pipe grades for international pipe shipments from the Company's Napa pipe mill, as was the case in the corresponding prior periods. The gross profit improvements were offset by gross profit declines of $1.9 million due to costs incurred primarily in the first quarter of 1995 which were associated with the winding down of operations of the Company's Fontana plate mill which was permanently closed in December of 1994. Contributing to the offset of increasing gross profits were higher scrap prices at the Oregon Steel and CF&I Steel Divisions. Additionally, gross profits were reduced due to increased costs associated with notably lower production levels at the Company's Camrose pipe mill. 8 OREGON STEEL MILLS, INC. Selling, general and administrative expenses ("SG&A") for the three month and six month periods ended June 30, 1995 decreased $3.1 million and $4.6 million, respectively, from the corresponding periods in 1994. These decreases were due primarily to decreased shipping expenses by the Oregon Steel Division as a result of the closure of the Fontana plate mill in December of 1994 and reduced shipping volume from the Company's Napa and Camrose pipe mills. Additionally, the closure of the Fontana plate mill reduced SG&A costs, other than shipping expenses, $814,000 and $1.4 million in the three and six month periods ended 1995 compared to the same periods in 1994. SG&A as a percent of revenues for the three and six month periods ended June 30, 1995 was 6.7 and 6.2 percent, respectively, compared to 5.8 and 5.7 percent for the corresponding periods in 1994. The contribution to the employee stock ownership plan and the profit participation expense for the three and six month periods ended June 30, 1995 increased compared to the corresponding 1994 periods, reflecting the increased profitability in 1995 versus 1994. Other Income (Expense) - ---------------------- Total interest costs for the three and six month periods ended June 30, 1995, were $5.4 million and $10.1 million, respectively, compared to $2.9 million and $5 million for the corresponding 1994 periods. These increases were primarily the result of the debt incurred to fund the Portland combination mill and the CF&I capital expenditure programs. Capitalized interest cost for the three and six month periods ended June 30, 1995 was $3.2 million and $6 million, respectively, compared to $1.5 million and $2.6 million for the corresponding 1994 periods. Income Taxes - ------------ The Company's effective income tax rate was 39 percent for the three and six month periods ended June 30, 1995, and 38 percent for the corresponding 1994 periods. The benefit of income taxes was at a rate of 32.2 percent for the year ended December 31, 1994. Income before income taxes in 1994 included a non-taxable $12.3 million gain on the sale of a 10 percent equity interest in New CF&I, Inc. Also contributing to the 1994 income tax benefit was the utilization of state tax credits. Liquidity and Capital Resources - ------------------------------- The Company's cash flow from operations for the six month period ended June 30, 1995 was a positive $61 million compared to a negative cash flow of $19 million in the corresponding 1994 period. The major items causing the $80 million increase were a decrease in trade accounts receivable in 1995 versus an increase in 1994 ($43 million), a greater reduction of inventories in 1995 compared to the corresponding 1994 period ($18.5 million), a decrease in refundable income taxes in 1995 compared to an increase in 1994 ($4.3 million), a smaller increase in accounts payable in 1995 compared to the increase in 1994 ($12 million), and a larger increase in accrued expenses in 1995 versus the increase in the corresponding 1994 period ($7.1 million). These increases in cash flow were offset by decreases in cash flow due to an increase in notes receivable in 1995 versus 1994 ($2.1 million), a reduced increase in post-retirement obligations in 1995 versus 1994 ($1.6 million), and a reduction of minority interests in 1995 versus an increase in 1994 ($1.2 million). Net working capital at June 30, 1995 decreased $46.6 million from December 31, 1994 due to a $39.3 million decrease in current assets, principally inventory and accounts receivable, and $7.3 million increase in current liabilities, principally accrued expenses. Cash generated from operations was used primarily to fund the Company's capital expansion projects. 9 OREGON STEEL MILLS, INC. The Company maintains a $100 million revolving credit facility and a $200 million term loan facility (the "Senior Credit Facilities"). Maximum borrowings available under the revolving credit facility are based on the amount of the combined inventory and accounts receivable of the Company. At June 30, 1995, $140 million was outstanding under the Senior Credit Facilities. The Company has a $14.5 million uncollateralized and uncommitted revolving line of credit with a bank which matures May 31, 1996 and may be used to support issuance of letters of credit, foreign exchange contracts and interest rate hedges. At June 30, 1995, $9.6 million was restricted under outstanding letters of credit. In addition, the Company has a $5 million uncollateralized and uncommitted revolving credit line with a bank which is restricted to use for letters of credit. At June 30, 1995, $3.6 million was restricted under outstanding letters of credit. Camrose maintains a Canadian $24 million revolving credit facility with a bank, $9 million of which expires August 31, 1995, with the remainder expiring on October 31, 1996. The facility is collateralized by substantially all of the assets of Camrose. Borrowings under this facility are limited to an amount equal to specified percentages of Camrose's eligible trade accounts receivables and inventories. As of June 30, 1995, Camrose had $5.5 million outstanding under this facility. CF&I incurred indebtedness in an original principal amount of $67.5 million as part of the purchase price of the assets of CF&I Steel Corporation on March 3, 1993. At June 30, 1995, the outstanding balance was $57.7 million, of which $53.4 million was classified as noncurrent. The Company's total capitalization at June 30, 1995 of $480 million consists of $200 million in long-term debt and $280 million in stockholder's equity, for a long-term debt-to-capitalization ratio of .42 to 1. Net book value per share of common stock at June 30, 1995 was $14.40 per share versus $14.24 per share at December 31, 1994. The Company believes that anticipated needs for working capital and the capital expenditure program (noted below) will be met from existing cash balances, funds generated from operations and borrowings pursuant to the Senior Credit Facilities. CAPITAL EXPENDITURES. In the first six months of 1995, the Company expended approximately $28 million on the capital program at CF&I and $40 million on the combination mill at the Portland steel mill. During the balance of 1995 the Company expects to expend $42 million on the capital program at CF&I and $85 million on the combination mill at the Portland steel mill. To complete the capital program at CF&I and the combination mill in 1996, the Company expects to expend $15 million at CF&I and $58 million on the combination mill. In addition, the Company has expended approximately $3 million for capital improvements at its Oregon Steel Division manufacturing facilities for recurring upgrade projects to the present facilities and equipment during the first six months of 1995. The Company expects to expend approximately $7 million on these projects during the remainder of 1995. The Company has also budgeted $15 million for an approximate 13 percent equity interest in a planned Venezuelan hot briquetted iron plant. Approximately $7 million is planned to be expended in 1995. 10 OREGON STEEL MILLS, INC. PART II OTHER INFORMATION Item 1. Legal Proceedings ----------------- STATE OF OREGON OCCUPATIONAL SAFETY AND HEALTH DIVISION ("OREGON OSHA") CITATION. On July 25, 1995 Oregon OSHA cited the Company $1.4 million in penalties for alleged violations of Oregon occupational safety and health rules. Of the eighteen individual citations, ten were alleged by Oregon OSHA to be willful. Oregon OSHA claims that a Material Safety Data Sheet ("MSDS") that the Company had prepared for its glass frit product produced at its Portland steel mill was incomplete in its description of certain metals present in the product. Oregon OSHA also claims that certain administrative and recordkeeping aspects of the glass plant's lead and cadmium protection programs were not in complete compliance with applicable OSHA regulations. With the assistance of counsel, the Company has conducted its own investigation of all the alleged violations. Based on that investigation, it is the Company's belief that no willful violation of the OSHA rules occurred. Since Oregon OSHA's investigation began, the Company has been fully cooperating with OSHA. Oregon OSHA has pointed out some areas where the Company has not been in complete technical compliance with certain administrative and recordkeeping rules, and the Company promptly corrected those issues. The Company has appealed the citation, and believes that the final outcome will not have a material adverse effect on the Company's results of operations, its financial position, or its cash flows. Item 6. Exhibits and Reports on Form 8-K -------------------------------- (a) Exhibits 11. Statement Regarding Computation of Per Share Earnings 27. Financial Data Schedule (b) Reports on Form 8-K During the quarter ended June 30, 1995, no reports on Form 8-K were filed by the Company. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. OREGON STEEL MILLS, INC. Date: August 11, 1995 /s/ Jackie L. Williams -------------------------- Jackie L. Williams Corporate Controller (Principal Accounting Officer) 11 EX-27 2
5 1000 6-MOS DEC-31-1995 JUN-30-1995 184 0 72458 1871 137656 220215 500342 105155 690236 125283 0 194 0 0 279503 690236 338165 342124 301658 301658 0 0 4123 12497 4841 7656 0 0 0 7656 .38 .38
EX-11 3 OREGON STEEL MILLS, INC. EXHIBIT 11 STATEMENT REGARDING COMPUTATION OF PER SHARE EARNINGS (In thousands, except per share data amounts) Three Months Ended Six Months Ended June 30, June 30, ------------------ ---------------- 1995 1994 1995 1994 ------ ------ ------ ------ Weighted average number of common shares outstanding 19,422 19,378 19,415 19,373 Common stock equivalents arising from 598 shares of stock to be issued March 2003 598 598 598 598 ------- ------- ------- ------- 20,020 19,976 20,013 19,971 ======= ======= ======= ======= Net income $ 5,746 $ 3,439 $ 7,656 $ 7,126 ======= ======= ======= ======= Primary and fully diluted net income per common and common equivalent share $.29 $.17 $.38 $.36 ==== ==== ==== ==== -----END PRIVACY-ENHANCED MESSAGE-----