10-Q 1 d10q.txt FORM 10-Q FOR THE QUARTER ENDED 3/31/2001 ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2001 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 1-12147 DELTIC TIMBER CORPORATION (Exact name of registrant as specified in its charter)
Delaware 71-0795870 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification Number) 210 East Elm Street, P. O. Box 7200, El Dorado, Arkansas 71731-7200 (Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (870) 881-9400 Securities registered pursuant to Section 12(b) of the Act: Title of each class Name of each exchange on which registered Common Stock, $.01 Par Value New York Stock Exchange, Inc. Series A Participating Cumulative New York Stock Exchange, Inc. Preferred Stock Purchase Rights 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, and (2) has been subject to such filing requirements for the past 90 days. Yes X No . --- --- Number of shares of Common Stock, $.01 Par Value, outstanding at April 30, 2001, was 11,886,823. ================================================================================ TABLE OF CONTENTS - FIRST QUARTER 2001 FORM 10-Q REPORT
Page Number ------ PART I - Financial Information Item 1. Financial Statements 3 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 12 Item 3. Quantitative and Qualitative Disclosures About Market Risk 15 PART II - Other Information Item 1. Legal Proceedings 16 Item 2. Changes in Securities and Use of Proceeds 16 Item 3. Defaults Upon Senior Securities 16 Item 4. Submission of Matters to a Vote of Security Holders 16 Item 5. Other Information 16 Item 6. Exhibits and Reports on Form 8-K 16 Signatures 17
2 PART I - FINANCIAL INFORMATION Item 1. Financial Statements DELTIC TIMBER CORPORATION AND SUBSIDIARIES Consolidated Balance Sheets ------------------------------------ (Thousands of dollars)
March 31, Dec. 31, 2001 2000 -------- ------- (unaudited) Assets Current assets Cash and cash equivalents $ 5,454 2,712 Trade accounts receivable - net 5,088 3,820 Other receivables 6,253 4,807 Inventories 4,169 5,127 Prepaid expenses and other current assets 992 583 -------- ------- Total current assets 21,956 17,049 Investment in real estate held for development and sale 34,676 34,100 Investment in Del-Tin Fiber 7,369 5,862 Other investments and noncurrent receivables 20,123 35,884 Timber and timberlands - net 210,380 181,398 Property, plant, and equipment - net 40,719 45,206 Deferred charges and other assets 2,382 3,134 -------- ------- Total assets $337,605 322,633 ======== ======= Liabilities and Stockholders' Equity Current liabilities Current maturities of long-term debt $ 32 160 Notes payable - 800 Trade accounts payable 2,134 2,936 Accrued taxes other than income taxes 1,400 1,072 Bank overdraft - 1,384 Deferred revenues and other accrued liabilities 2,682 611 -------- ------- Total current liabilities 6,248 6,963 Long-term debt 92,088 87,410 Deferred tax liabilities 20,089 13,014 Other noncurrent liabilities 5,444 8,412 Redeemable preferred stock 30,000 30,000 Stockholders' equity Preferred stock - - Common stock 128 128 Capital in excess of par value 68,757 68,757 Retained earnings 136,165 128,290 Unamortized restricted stock awards (419) (472) Treasury stock (20,895) (19,869) -------- ------- Total stockholders' equity 183,736 176,834 -------- ------- Total liabilities and stockholders' equity $337,605 322,633 ======== =======
See accompanying notes to consolidated financial statements. 3 DELTIC TIMBER CORPORATION AND SUBSIDIARIES Consolidated Statements of Income (Unaudited) Three Months Ended March 31, ------------------------------------------------ (Thousands of dollars, except per share amounts)
2001 2000 ------- ------ Net sales $ 22,494 29,746 ------- ------ Costs and expenses Cost of sales 11,775 17,481 Depreciation, amortization, and cost of fee timber harvested 4,465 3,857 General and administrative expenses 1,648 2,270 ------- ------ Total costs and expenses 17,888 23,608 ------- ------ Operating income 4,606 6,138 Equity in loss of Del-Tin Fiber (2,489) (2,252) Interest income 618 55 Interest and other debt expense (1,595) (1,030) Other income/(expense) 73 82 ------- ------ Income from continuing operations before income taxes 1,213 2,993 Income taxes (238) (1,025) ------- ------ Income from continuing operations 975 1,968 ------- ------ Discontinued operations Income from discontinued agriculture operations, net of income taxes - 214 Gain on disposal of agriculture segment, net of income taxes 8,212 - ------- ------ Income from discontinued operations 8,212 214 ------- ------ Net income $ 9,187 2,182 ======= ====== Earnings per common share Basic Continuing operations $ .03 .11 Discontinued operations .69 .02 ------- ------ Net income $ .72 .13 ======= ====== Assuming dilution Continuing operations $ .03 .11 Discontinued operations .69 .02 ------- ------ Net income $ .72 .13 ======= ====== Dividends declared per common share $ .0625 .0625 ======= ====== Average common shares outstanding (thousands) 11,923 12,374 ======= ======
See accompanying notes to consolidated financial statements. 4 DELTIC TIMBER CORPORATION AND SUBSIDIARIES Consolidated Statements of Cash Flows (Unaudited) Three Months Ended March 31, ---------------------------------------------- (Thousands of dollars)
2001 2000 -------- ------ Operating activities Net income $ 9,187 2,182 Adjustments to reconcile net income to net cash provided/(required) by operating activities Depreciation, amortization, and cost of fee timber harvested 4,465 3,999 Deferred income taxes 7,075 609 Gain from disposal of agriculture segment assets (13,364) - Real estate costs recovered upon sale 998 1,107 Timberland costs recovered upon sale 448 - Equity in loss of Del-Tin Fiber 2,489 2,252 (Increase)/decrease in operating working capital other than cash and cash equivalents (1,911) 2,791 Other (272) 415 -------- ------ Net cash provided/(required) by operating activities, including discontinued operations 9,115 13,355 -------- ------ Investing activities Capital expenditures requiring cash (32,699) (6,968) Net change in purchased stumpage inventory (2,058) (1,848) Advances to Del-Tin Fiber (3,953) (775) Purchases of U.S. government securities - (12) Maturities of U.S. government securities - 948 Proceeds from disposal of agriculture segment assets 17,831 - Increase/(decrease) in farmland sale contract deposits (1,455) - (Increase)/decrease in funds held by trustee 7,713 - Receipts of/(additions to) noncurrent receivables 8,046 (27) Other - net 174 399 -------- ------ Net cash provided/(required) by investing activities, including discontinued operations (6,401) (8,283) -------- ------ Financing activities Proceeds from borrowings 10,533 - Repayments of notes payable and long-term debt (6,783) (181) Treasury stock purchases (1,026) (2,079) Increase/(decrease) in bank overdraft (1,384) (6) Preferred stock dividends paid (566) (566) Common stock dividends paid (746) (773) -------- ------ Net cash provided/(required) by financing activities, including discontinued operations 28 (3,605) -------- ------ Net increase/(decrease) in cash and cash equivalents 2,742 1,467 Cash and cash equivalents at January 1 2,712 4,782 -------- ------ Cash and cash equivalents at March 31 $ 5,454 6,249 ======== ======
See accompanying notes to consolidated financial statements. 5 DELTIC TIMBER CORPORATION AND SUBSIDIARIES Consolidated Statements of Stockholders' Equity (Unaudited) Three Months Ended March 31, ------------------------------------------------------ (Thousands of dollars)
2001 2000 -------- ------- Cumulative preferred stock - $.01 par, authorized 20,000,000 shares, 600,000 shares issued as redeemable preferred stock $ - - -------- ------- Common stock - $.01 par, authorized 50,000,000 shares, 12,813,879 shares issued in 2001 and 2000 128 128 -------- ------- Capital in excess of par value Balance at beginning of year 68,757 68,808 Restricted stock awards - (51) -------- ------- Balance at end of period 68,757 68,757 -------- ------- Retained earnings Balance at beginning of year 128,290 120,033 Net income 9,187 2,182 Preferred stock dividends accrued (566) (566) Common stock dividends declared (746) (773) -------- ------- Balance at end of period 136,165 120,876 -------- ------- Unamortized restricted stock awards Balance at beginning of year (472) (205) Stock awards - (472) Amortization to expense 53 35 -------- ------- Balance at end of period (419) (642) -------- ------- Treasury stock Balance at beginning of year - 878,556 and 419,544 shares, respectively (19,869) (10,356) Shares purchased - 48,500 shares in 2001 and 94,206 shares in 2000 (1,026) (2,079) Shares issued for incentive plans - 21,400 shares in 2000 - 523 -------- ------- Balance at end of period - 927,056 and 492,350 shares, respectively (20,895) (11,912) -------- ------- Total stockholders' equity $ 183,736 177,207 ======== =======
See accompanying notes to consolidated financial statements. 6 DELTIC TIMBER CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements March 31, 2001 ----------------------------------------- (Unaudited, except for December 31, 2000) Note 1 - Interim Financial Statements The interim financial information included herein is unaudited; however, such information reflects all adjustments which are, in the opinion of management, necessary for a fair presentation of the Company's financial position, results of operations, and cash flows for the interim periods. All such adjustments are of a normal, recurring nature. The financial statements in Deltic's 2000 annual report on Form 10-K include a summary of significant accounting policies of the Company and should be read in conjunction with this Form 10-Q. Certain prior period amounts have been reclassified to conform with 2001 presentation format. Note 2 - Discontinued Agriculture Segment During the first quarter of 2001, the remaining 18,400 net acres of farmland and the majority of the operational assets, previously reported in Property, Plant, and Equipment in the Consolidated Balance Sheet, were sold and closed, resulting in a pretax gain on the disposal of the former agriculture segment of $13,522,000. Income tax expense for discontinued operations totaled $5,310,000. Since the Company is disposing of the agriculture segment in a tax-deferred exchange, the sales proceeds were deposited with a qualified intermediary to be used to acquire replacement property. During the first quarter of 2001, the Company acquired, utilizing the funds held by the qualified intermediary, approximately 22,800 acres of pine timberland, designated as replacement properties, with capital expenditures of $28,348,000, which completed the tax- deferred land exchange for Ashly Plantation, an undivided interest operation of which Deltic owns a majority interest. As part of the transaction, an advance, in the form of an interest-bearing note from the intermediate accommodating title holder, and a note from the minority owners of Ashly Plantation was repaid to the Company, amounting to $6,574,000. The remaining funds of $8,604,000, held by the intermediary, as trustee, are reported in Other Investments and Noncurrent Receivables in the March 31, 2001 Consolidated Balance Sheet. For additional information regarding discontinued operations, refer to the Company's 2000 annual report on Form 10-K. 7 DELTIC TIMBER CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements March 31, 2001 ----------------------------------------- (Unaudited, except for December 31, 2000) Note 3 - Earnings per Common Share The amounts used in computing earnings per share consisted of the following: Three Months Ended March 31, ------------------ (Thousands, except per share amounts) 2001 2000 ------- ------ Income from continuing operations $ 975 1,968 Discontinued operations, net 8,212 214 Less preferred dividends (566) (566) ------- ------ Income available to common shareholders $ 8,621 1,616 ======= ====== Weighted average number of common shares used in basic EPS 11,923 12,374 Effect of dilutive stock options 12 11 ------- ------ Weighted average number of common shares and dilutive potential common stock used in EPS assuming dilution 11,935 12,385 ======= ====== Earnings per common share Basic Continuing operations $ .03 .11 Discontinued operations .69 .02 ------- ------ Net income $ .72 .13 ======= ====== Assuming dilution Continuing operations $ .03 .11 Discontinued operations .69 .02 ------- ------ Net income $ .72 .13 ======= ====== Note 4 - Inventories Inventories at the balance sheet dates consisted of the following: Mar. 31, Dec. 31, (Thousands of dollars) 2001 2000 ------ ----- Logs $ 461 2,380 Lumber 3,288 2,359 Materials and supplies 420 388 ------ ----- $ 4,169 5,127 ====== ===== 8 DELTIC TIMBER CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements March 31, 2001 ----------------------------------------- (Unaudited, except for December 31, 2000) Note 5 - Investment in Del-Tin Fiber The Company owns 50 percent of the membership interest of Del-Tin Fiber. The Company's investment in Del-Tin Fiber is carried at cost, adjusted for the Company's proportionate share of undistributed earnings or losses. The financial position for Del-Tin Fiber as of the balance sheet dates and results of operations for the three months ended March 31 consisted of the following: March 31, Dec. 31, (Thousands of Dollars) 2001 2000 -------- ------- Condensed Balance Sheet Information Current assets $ 3,707 5,863 Property, plant, and equipment - net 95,653 95,571 Other noncurrent assets 6,723 4,650 -------- ------- Total assets $ 106,083 106,084 ======== ======= Current liabilities $ 1,628 4,558 Long-term debt 89,000 89,000 Other noncurrent liabilities 5 7 Members' capital/(deficit) 15,450 12,519 -------- ------- Total liabilities and members' capital/(deficit) $ 106,083 106,084 ======== ======= Three Months Ended March 31, ------------------- (Thousands of dollars) 2001 2000 -------- ------- Condensed Income Statement Information Net sales $ 2,014 8,672 -------- ------- Costs and expenses Cost of sales 4,849 9,879 Depreciation 520 1,279 General and administrative expenses 217 338 -------- ------- Total costs and expenses 5,586 11,496 -------- ------- Operating income/(loss) (3,572) (2,824) Interest income 44 52 Interest and other debt expense (1,449) (1,733) -------- ------- Net income/(loss) $ (4,977) (4,505) ======== ======= 9 DELTIC TIMBER CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements March 31, 2001 ----------------------------------------- (Unaudited, except for December 31, 2000) Note 6 - Timber and Timberlands Timber and timberlands at the balance sheet dates consisted of the following: Mar. 31, Dec. 31, (Thousands of dollars) 2001 2000 -------- ------- Purchased stumpage inventory $ 12,045 9,987 Timberlands 73,952 66,788 Fee timber 168,560 145,981 Logging facilities 1,673 1,672 -------- ------- 256,230 224,428 Less accumulated costs of fee timber harvested and facilities depreciation (45,850) (43,030) -------- ------- $ 210,380 181,398 ======== ======= Note 7 - Property, Plant, and Equipment Property, plant, and equipment at the balance sheet dates consisted of the following: Mar. 31, Dec. 31, (Thousands of dollars) 2001 2000 -------- ------- Land $ 125 2,584 Land improvements 3,022 4,121 Buildings and structures 4,468 4,790 Machinery and equipment 68,905 74,568 -------- ------- 76,520 86,063 Less accumulated depreciation (35,801) (40,857) -------- ------- $ 40,719 45,206 ======== ======= Note 8 - Supplemental Cash Flow Disclosures Income tax refunds received, net of payments, were $2,082,000 in the 2001 period, while income taxes paid, net of refunds, in the first quarter of 2000 were $74,000. Interest paid, net of amounts capitalized, was $451,000 and $297,000 in the first three months of 2001 and 2000, respectively. (Increases)/decreases in operating working capital other than cash and cash equivalents, for the three months ended March 31 consisted of the following: (Thousands of dollars) 2001 2000 ------- ------ Trade accounts receivable $ (1,268) (1,588) Other receivables (1,446) 86 Inventories 958 2,987 Prepaid expenses and other current assets (409) (610) Trade accounts payable (1,194) 883 Deferred revenues and other accrued liabilities 1,448 1,033 ------- ------ $ (1,911) 2,791 ======= ====== 10 DELTIC TIMBER CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements March 31, 2001 ----------------------------------------- (Unaudited, except for December 31, 2000) Note 9 - Business Segments Information about the Company's business segments consisted of the following: Three Months Ended March 31, ---------------- (Thousands of dollars) 2001 2000 ------- ------ Net sales Woodlands $ 12,809 10,866 Mills 10,550 21,043 Real Estate 3,143 2,838 Eliminations* (4,008) (5,001) ------- ------ $ 22,494 29,746 ======= ====== Income/(loss) from continuing operations before income taxes Operating income Woodlands $ 7,900 7,334 Mills (2,376) 773 Real Estate 591 297 Corporate (1,487) (2,150) Eliminations (22) (116) ------- ------ Operating income 4,606 6,138 Equity in loss of Del-Tin Fiber (2,489) (2,252) Interest income 618 55 Interest and other debt expense (1,595) (1,030) Other income/(expense) 73 82 ------- ------ $ 1,213 2,993 ======= ====== Depreciation, amortization, and cost of fee timber harvested Woodlands $ 3,016 2,622 Mills 1,333 1,085 Real Estate 80 78 Corporate 36 72 ------- ------ $ 4,465 3,857 ======= ====== Capital expenditures Woodlands $ 29,663 3,393 Mills 1,273 890 Real Estate 1,754 2,449 Corporate 9 235 ------- ------ Capital expenditures for continuing operations 32,699 6,967 Discontinued agriculture operations - 1 ------- ------ $ 32,699 6,968 ======= ====== *Intersegment sales of timber from Woodlands to Mills. 11 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations Net income for the first quarter of 2001 was $9.2 million, $.72 a share, an increase of $7 million when compared to first quarter 2000 earnings of $2.2 million, $.13 a share. Income from discontinued operations, net of income taxes, was $8.2 million, $.69 a share, for the current quarter compared to $.2 million, $.02 a share, for the first quarter of 2000. Income from continuing operations for the first three months of 2001 was $1 million, $.03 a share, compared to $2 million, $.11 a share, a year ago. Net sales for the first quarter of 2001 totaled $22.5 million, a decrease of $7.2 million when compared to the prior- year quarter. Operating income for the current quarter was $4.6 million compared to $6.1 million during the corresponding quarter of 2000. Net cash provided by operating activities decreased $4.3 million, from $13.4 million in 2000 to $9.1 million for the 2001 period. Operating income for the first quarter of 2001 decreased $1.5 million when compared to the first quarter of 2000. The Woodlands segment increased $.6 million due to sales of non-strategic and higher and better use timberland at a $3.9 million gain, partially offset by a reduction in pine sawtimber sales of $2.5 million resulting from a 13 percent decrease in harvest levels and a 15 percent decrease in sales price. Operating income for the Mills segment decreased $3.2 million from the same quarter in 2000, resulting in a loss of $2.4 million. The sales price of finished lumber decreased 21 percent to $287 per thousand board feet ("MBF"). Lumber sales volume decreased 20 million board feet ("MMBF") to 30.2 MMBF due to market conditions and temporary downtime and reduced production rates related to recently completed construction projects at both Deltic mills. The Woodlands segment reported net sales of $12.8 million for the current quarter compared to $10.9 million a year ago. Sales of 1,478 acres of timberland generated $4.6 million. Sales of pine sawtimber decreased $2.5 million as a result of a 26,310 ton decrease in harvest levels to 178,644 tons and a $7 per ton decrease in the pine sawtimber sales price to $41 per ton. Operating income was $7.9 million in the first quarter of 2001, an increase of $.6 million when compared to first quarter 2000 operating income of $7.3 million, resulting primarily from the increase in net sales, partially offset by an increase in costs of timberland sales of $.7 million and by a $.4 million higher cost of fee timber harvested due to an increase in the cost per ton of timber harvested. Mills operations' net sales for the first quarter of 2001 was $10.6 million compared to $21 million for the first quarter of 2000. Finished lumber sales volume decreased 40 percent to 30.2 MMBF and the average sales price declined by $77 per MBF to $287. An operating loss of $2.4 million was reported in the current quarter compared to operating income of $.8 million for the 2000 period. The decrease of $3.2 million was primarily due to the reduction in net sales. The Real Estate segment recorded net sales of $3.1 million in 2001 compared to $2.8 million in 2000. Residential lot sales decreased 12 lots to 24 in the current quarter as a result of the timing of lot offerings, while the average sales price per lot increased $29,400 to $78,300 due to the sales mix. The prior-year period benefited from a .7-acre commercial outparcel sale for $206,500 per acre. Operating income increased $.3 million to $.6 million due to the increase in net sales. Corporate operating expense was $1.5 million in the first quarter of 2001, which compares to $2.2 million for the same quarter of 2000. The decrease was the result of lower general and administrative expenses, due primarily to reduced costs related to awards under the Company's incentive plans. Equity in the loss of Del-Tin Fiber recorded by the Company in 2001 was $2.5 million compared to $2.3 million a year ago. Income tax expense related to continuing operations for the current quarter was $.2 million, a decrease of $.8 million due to lower pretax income. 12 The first quarter of 2001 included income from discontinued agriculture operations, net of income taxes, of $8.2 million compared to $.2 million for the first quarter of 2000. The sale of approximately 18,400 net acres of farmland at a pretax gain of $13.4 million was recorded in the current quarter. Income tax expense for discontinued operations totaled $5.3 million for the current- year period and $.1 million in the corresponding period in 2000. Financial Condition Net cash provided by operating activities totaled $9.1 million during the first quarter of 2001 compared to $13.4 million a year ago. Changes in operating working capital, other than cash and cash equivalents, provided cash of $1.9 million for the first three months of 2001 but required cash of $2.8 million for the corresponding period in 2000. Capital expenditures required cash of $32.7 million in the current quarter and $7 million in the prior year. Capital expenditures by segment consisted of the following: Three Months Ended March 31, --------------- (Thousands of dollars) 2001 2000 ---- ---- Woodlands $ 29,663 3,393 Mills 1,273 890 Real Estate 1,754 2,449 Corporate 9 235 ------ ----- Capital expenditures for continuing operations 32,699 6,967 Discontinued agriculture operations - 1 ------ ----- Total capital expenditures requiring cash $ 32,699 6,968 ====== ===== The net change in purchased stumpage inventory to be utilized in the Company's sawmill operations required cash of $2.1 million in 2001 and $1.8 million in 2000. The Company advanced Del-Tin Fiber $4 million during the current quarter and $.8 million during the corresponding quarter of 2000. The disposal of additional agriculture operations assets generated proceeds of $17.8 million, $1.5 million of which had previously been received as farmland sale contract deposits, that were deposited with a trustee as required for a tax- deferred exchange. These proceeds, combined with $7.7 million already held by a trustee from similar transactions recorded in prior periods, were utilized to purchase designated replacement timberland properties and are included in capital expenditures of the Woodlands segment. Upon completion of one of the two reverse land exchanges in which Deltic is involved, $8 million previously advanced to the accommodating title holder required in such reverse exchange was repaid to the Company. The Company borrowed $10.5 million and made repayments of debt of $6.8 million during the first quarter of 2001 compared to debt repayments of $.2 million during the first three months of 2000. The decrease in bank overdraft in the current quarter was $1.4 million. Purchases of treasury stock for the respective periods utilized $1 million and $2.1 million. Deltic paid dividends totaling $1.3 million in both 2001 and 2000, consisting of $.7 million for common stock and $.6 million for redeemable preferred stock. These net sources of funds resulted in a $2.7 million increase in the Company's cash and cash equivalents since December 31, 2000. On December 14, 2000, the Company's Board of Directors authorized a stock repurchase program of up to $10 million of its common stock. Under this program, the Company can purchase shares through the open market and privately negotiated transactions at prices deemed appropriate by Deltic's management. As of March 31, 2001, Deltic had expended $1 million of the amount committed under this program, with the purchase of 48,500 shares at an average cost of $21.15 per share. 13 Deltic's management believes that the cash generated by its operating activities and the remaining amount available under its credit facility will be sufficient to meet its expected cash needs and planned expenditures, including those of the Company's continuing timberland acquisition program and the remaining amount committed under its authorized common stock repurchase program, for the foreseeable future. Statements included herein that are not historical in nature are intended to be, and are hereby identified as, "forward-looking statements" within the meaning of the federal securities laws. Such statements reflect the Company's current expectations and involve risks and uncertainties. Actual results could differ materially from those included in such forward-looking statements. Factors that could cause such differences include, but are not limited to, the cyclical nature of the industry, changes in interest rates and general economic conditions, adverse weather, cost and availability of materials used to manufacture the Company's products, and the risk factors described from time to time in the reports and disclosure documents filed by the Company with the Securities and Exchange Commission. 14 Item 3. Quantitative and Qualitative Disclosures About Market Risk The Company's market risk has not changed significantly from that set forth under the caption "Quantitative and Qualitative Disclosures About Market Risk", in Item 7A of Part II of its 2000 annual report on Form 10-K. Those disclosures should be read in conjunction with this Form 10-Q. 15 PART II - OTHER INFORMATION Item 1. Legal Proceedings From time to time, the Company is involved in litigation incidental to its business. Currently, there are no material legal proceedings. Item 2. Changes in Securities and Use of Proceeds None. Item 3. Defaults Upon Senior Securities. None. Item 4. Submission of Matters to a Vote of Security Holders None. Item 5. Other Information None. Item 6. Exhibits and Reports on Form 8-K (a) Exhibits None. (b) Reports on Form 8-K None. 16 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. DELTIC TIMBER CORPORATION By: /s/Ron L. Pearce Date: May 10, 2001 ----------------------------------- ------------------------------ Ron L. Pearce, President (Principal Executive Officer) /s/Clefton D. Vaughan Date: May 10, 2001 ----------------------------------- ------------------------------ Clefton D. Vaughan, Vice President, Finance and Administration (Principal Financial Officer) /s/Emily R. Evers Date: May 10, 2001 ----------------------------------- ------------------------------ Emily R. Evers, Controller (Principal Accounting Officer) 17