BOISE CASCADE CORP - 10-Q Quarterly Report

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(X)	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2003

( )	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: 1-5057

BOISE CASCADE CORPORATION
(Exact name of registrant as specified in its charter)

Delaware

82-0100960

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

1111 West Jefferson Street
P.O. Box 50
Boise, Idaho

83728

(Address of principal executive offices) (208) 384-6161 (Registrant's telephone number, including area code)	(Zip Code)

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 ___

Indicated by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Securities Exchange Act of 1934). Yes X No ___

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

Class
Common Stock, $2.50 par value

Shares Outstanding
as of April 30, 2003
58,291,711

PART I - FINANCIAL INFORMATION

ITEM 1.

FINANCIAL STATEMENTS

Boise Cascade Corporation and Subsidiaries
Consolidated Statements of Loss
(thousands, except per-share amounts)

	Three Months Ended March 31
	_______________________
	2003			2002
	_________			_________
		(unaudited)

Sales	$	1,853,243		$	1,788,223
	_________			_________
Costs and expenses
Materials, labor, and other operating expenses		1,515,189			1,460,984
Depreciation, amortization, and cost of company timber harvested		75,582			72,734
Selling and distribution expenses		214,162			191,687
General and administrative expenses		35,373			35,003
Other (income) expense, net		11,152			3,620
	_________			_________
		1,851,458			1,764,028
	_________			_________
Equity in net loss of affiliates		(59	)		(1,573	)
	_________			_________
Income from operations		1,726			22,622
	_________			_________
Interest expense		(28,880	)		(30,048	)
Interest income		114			255
Foreign exchange gain (loss)		956			(228	)
	_________			_________
		(27,810	)		(30,021	)
	_________			_________
Loss before income taxes, minority interest, and cumulative effect of accounting changes		(26,084	)		(7,399	)
Income tax benefit		9,364			2,775
	_________			_________
Loss before minority interest and cumulative effect of accounting changes		(16,720	)		(4,624	)
Minority interest, net of income tax		(2,023	)		(1,996	)
	_________			_________
Loss before cumulative effect of accounting changes		(18,743	)		(6,620	)
Cumulative effect of accounting changes, net of income tax		(8,803	)		-
	_________			_________

Net loss		(27,546	)		(6,620	)
Preferred dividends		(3,266	)		(3,262	)
	_________			_________

Net loss applicable to common shareholders	$	(30,812	)	$	(9,882	)
	=========			=========
Net loss per common share
Basic and diluted before cumulative effect of accounting changes		$(0.38	)		$(0.17	)
Cumulative effect of accounting changes		(0.15	)		-
	_____			_____

Basic and diluted		$(0.53	)		$(0.17	)
	=====			=====

Pro forma amounts assuming accounting changes were applied retroactively (see Note 8)
Net loss	$	(27,546	)	$	(5,371	)
	=========			=========
Net loss per common share
Basic and diluted		$(0.53	)		$(0.15	)
	=====			=====

See accompanying notes to consolidated financial statements.

Boise Cascade Corporation and Subsidiaries
Consolidated Balance Sheets
(thousands)

	March 31						December 31
	_________________________						___________
	2003				2002		2002
	_________			___________			___________
	(unaudited)
ASSETS
Current
Cash and cash equivalents	$	85,256		$	56,290		$	65,152
Receivables, less allowances
of $12,206, $12,435, and $13,111		481,639			518,614			423,976
Inventories		676,707			636,194			717,966
Deferred income tax benefits		63,601			74,781			52,131
Other		36,145			49,356			36,524
	__________			___________			___________
		1,343,348			1,335,235			1,295,749
	__________			___________			___________
Property
Property and equipment
Land and land improvements		72,277			69,785			70,731
Buildings and improvements		739,997			688,131			709,127
Machinery and equipment		4,676,910			4,619,172			4,678,112
	__________			___________			___________
		5,489,184			5,377,088			5,457,970
Accumulated depreciation		(2,962,806	)		(2,788,299	)		(2,915,940	)
	__________			___________			___________
		2,526,378			2,588,789			2,542,030
Timber, timberlands, and timber deposits		326,583			320,343			328,720
	__________			___________			___________
		2,852,961			2,909,132			2,870,750
	__________			___________			___________

Goodwill		409,500			388,123			400,541
Investments in equity affiliates		35,553			60,589			35,641
Other assets		329,567			314,723			344,719
	__________			___________			___________
Total assets	$	4,970,929		$	5,007,802		$	4,947,400
	==========			===========			===========

See accompanying notes to consolidated financial statements.

Boise Cascade Corporation and Subsidiaries
Consolidated Balance Sheets
(thousands, except share amounts)

	March 31						December 31
	_______________________						___________
	2003			2002			2002
	_________			_________			___________
	(unaudited)
LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Short-term borrowings	$	14,800		$	55,400		$	28,000
Current portion of long-term debt		90,654			195,999			125,651
Income taxes payable		7,535			-			9,512
Accounts payable		519,083			500,223			519,596
Accrued liabilities
Compensation and benefits		208,638			140,164			218,085
Interest payable		24,655			29,195			29,928
Other		143,552			162,937			122,832
	_________			_________			___________
		1,008,917			1,083,918			1,053,604
	_________			_________			___________
Debt
Long-term debt, less current portion		1,472,670			1,322,347			1,387,398
Guarantee of ESOP debt		51,448			80,889			51,448
	_________			_________			___________
		1,524,118			1,403,236			1,438,846
	_________			_________			___________
Other
Deferred income taxes		166,033			311,208			165,357
Compensation and benefits		668,260			427,696			667,694
Other long-term liabilities		58,971			41,322			49,868
	_________			_________			___________
		893,264			780,226			882,919
	_________			_________			___________
Minority interest
Company-obligated mandatorily redeemable securities of subsidiary trust holding solely debentures of parent	172,500			172,500			172,500
	_________			_________			___________

Commitments and contingent liabilities

Shareholders' equity
Preferred stock -- no par value; 10,000,000 shares authorized;
Series D ESOP: $.01 stated value; 4,218,361, 4,420,113, and 4,280,615 shares outstanding		189,826			198,905			192,628
Deferred ESOP benefit		(51,448	)		(80,889	)		(51,448	)
Common stock -- $2.50 par value; 200,000,000 shares authorized; 58,291,781, 58,195,175, and 58,283,719 shares outstanding		145,729			145,488			145,709
Additional paid-in capital		474,715			470,830			474,533
Retained earnings		917,175			969,876			952,215
Accumulated other comprehensive loss		(303,867	)		(136,288	)		(314,106	)
	_________			_________			___________
Total shareholders' equity		1,372,130			1,567,922			1,399,531
	_________			_________			___________
Total liabilities and shareholders' equity	$	4,970,929		$	5,007,802		$	4,947,400
	=========			=========			===========

See accompanying notes to consolidated financial statements.

Boise Cascade Corporation and Subsidiaries
Consolidated Statements of Cash Flows
(thousands)

	Three Months Ended March 31
	__________________________
	2003			2002
	___________			___________
	(unaudited)
Cash provided by (used for) operations
Net loss	$	(27,546	)	$	(6,620	)
Items in net loss not using (providing) cash
Equity in net loss of affiliates		59			1,573
Depreciation, amortization, and cost of company timber harvested		75,582			72,734
Deferred income tax benefit		(13,304	)		(8,563	)
Pension and other postretirement benefits expense		20,529			9,318
Cumulative effect of accounting changes, net of income tax		8,803			- -
Other		(956	)		228
Receivables		(47,848	)		(93,892	)
Inventories		33,508			16,759
Accounts payable and accrued liabilities		(7,434	)		1,277
Current and deferred income taxes		(10,159	)		(518	)
Pension and other postretirement benefits payments		(2,806	)		(2,279	)
Other		20,419			10,498
	___________			___________
Cash provided by operations		48,847			515
	___________			___________
Cash provided by (used for) investment
Expenditures for property and equipment		(43,419	)		(43,682	)
Expenditures for timber and timberlands		(2,253	)		(2,136	)
Investments in equity affiliates		29			-
Other		(8,309	)		(17,314	)
	___________			___________
Cash used for investment		(53,952	)		(63,132	)
	___________			___________
Cash provided by (used for) financing
Cash dividends paid
Common stock		(8,743	)		(8,709	)
Preferred stock		(30	)		(37	)
	___________			___________
		(8,773	)		(8,746	)
Short-term borrowings		(13,200	)		6,700
Additions to long-term debt		120,000			149,851
Payments of long-term debt		(70,159	)		(85,955	)
Other		(2,659	)		355
	___________			___________
Cash provided by financing		25,209			62,205
	___________			___________

Increase (decrease) in cash and cash equivalents		20,104			(412	)
Balance at beginning of the year		65,152			56,702
	___________			___________
Balance at March 31	$	85,256		$	56,290
	===========			===========

See accompanying notes to consolidated financial statements.

Notes to Quarterly Consolidated Financial Statements (Unaudited)

1.	Basis of Presentation

We have prepared the quarterly consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Some information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to those rules and regulations. These statements should be read together with the consolidated statements and the accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2002.

The quarterly consolidated financial statements have not been audited by independent auditors, but in the opinion of management, we have included all adjustments necessary to present fairly the results for the periods. Net loss for the three months ended March 31, 2003 and 2002, involved estimates and accruals. Actual results may vary from those estimates. Except as may be disclosed within these "Notes to Quarterly Consolidated Financial Statements," the adjustments made were of a normal, recurring nature. Quarterly results are not necessarily indicative of results that may be expected for the year.

Certain amounts in prior years' financial statements have been reclassified to conform with the current year's presentation. These reclassifications did not affect our net loss.

2.	Net Loss Per Common Share

Net loss per common share was determined by dividing net loss, as adjusted, by applicable shares outstanding. For both periods presented, the computation of diluted net loss per share was antidilutive; therefore, the amounts reported for basic and diluted loss were the same.

	Three Months Ended March 31
	__________________
	2003			2002
	_______			_______
	(thousands, except per-share amounts)

Loss before cumulative effect of accounting changes	$	(18,743	)	$	(6,620	)
Preferred dividends (a)		(3,266	)		(3,262	)
	_______			_______
Basic and diluted loss before cumulative effect of accounting changes		(22,009	)		(9,882	)
Cumulative effect of accounting changes, net of income tax		(8,803	)		-
	_______			_______
Basic and diluted loss (b)	$	(30,812	)	$	(9,882	)
	=======			=======

Average shares used to determine basic and diluted loss per common share (b) (c)		58,289			58,099
	=======			=======
Basic and diluted loss per common share before cumulative effect of accounting changes		$(0.38	)		$(0.17	)
Cumulative effect of accounting changes		(0.15	)		-
	_____			_____
Basic and diluted loss per common share		$(0.53	)		$(0.17	)
	=====			=====

(a)	The dividend attributable to our Series D Convertible Preferred Stock held by our ESOP (employee stock ownership plan) is net of a tax benefit.

(b)

Adjustments totaling $0.3 million for the three months ended March 31, 2003 and 2002, which would have reduced the basic loss to arrive at diluted loss, were excluded because the calculation of diluted loss per share was antidilutive. Also, for the three months ended March 31, 2003 and 2002, potentially dilutive common shares of 3.6 million and 4.1 million were excluded from average shares because they were antidilutive.