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 June 30, 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 July 31, 2003
58,442,728

PART I - FINANCIAL INFORMATION

ITEM 1.

FINANCIAL STATEMENTS

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

	Three Months Ended June 30
	_______________________
	2003			2002
	_________			_________
		(unaudited)

Sales	$	1,928,984		$	1,888,027
	_________			_________
Costs and expenses
Materials, labor, and other operating expenses		1,578,445			1,540,027
Depreciation, amortization, and cost of company timber harvested		73,730			78,690
Selling and distribution expenses		217,472			195,085
General and administrative expenses		35,297			40,866
Other (income) expense, net		1,836			25,669
	_________			_________
		1,906,780			1,880,337
	_________			_________
Equity in net income (loss) of affiliates		474			(482	)
	_________			_________
Income from operations		22,678			7,208
	_________			_________
Interest expense		(27,753	)		(30,010	)
Interest income		318			800
Foreign exchange gain		1,860			371
	_________			_________
		(25,575	)		(28,839	)
	_________			_________
Loss before income taxes and minority interest		(2,897	)		(21,631	)
Income tax benefit		985			26,891
	_________			_________
Income (loss) before minority interest		(1,912	)		5,260
Minority interest, net of income tax		(2,022	)		(2,017	)
	_________			_________
Net income (loss)		(3,934	)		3,243
Preferred dividends		(3,287	)		(3,288	)
	_________			_________

Net loss applicable to common shareholders	$	(7,221	)	$	(45	)
	=========			=========
Net income (loss) per common share
Basic and diluted		$(0.12	)		$0.00
	=====			=====
Pro forma amounts assuming accounting changes were applied retroactively (see Note 7)
Net income (loss)	$	(3,934	)	$	4,064
	=========			=========
Net income (loss) per common share
Basic and diluted		$(0.12	)		$0.01
	=====			=====

See accompanying notes to consolidated financial statements.

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

	Six Months Ended June 30
	_______________________
	2003			2002
	_________			_________
		(unaudited)

Sales	$	3,782,227		$	3,676,250
	_________			_________
Costs and expenses
Materials, labor, and other operating expenses		3,093,634			3,001,011
Depreciation, amortization, and cost of company timber harvested		149,312			151,424
Selling and distribution expenses		431,634			386,772
General and administrative expenses		70,670			75,869
Other (income) expense, net		12,988			29,289
	_________			_________
		3,758,238			3,644,365
	_________			_________
Equity in net income (loss) of affiliates		415			(2,055	)
	_________			_________
Income from operations		24,404			29,830
	_________			_________
Interest expense		(56,633	)		(60,058	)
Interest income		432			1,055
Foreign exchange gain		2,816			143
	_________			_________
		(53,385	)		(58,860	)
	_________			_________
Loss before income taxes, minority interest, and cumulative effect of accounting changes		(28,981	)		(29,030	)
Income tax benefit		10,349			29,666
	_________			_________
Income (loss) before minority interest and cumulative effect of accounting changes		(18,632	)		636
Minority interest, net of income tax		(4,045	)		(4,013	)
	_________			_________
Loss before cumulative effect of accounting changes		(22,677	)		(3,377	)
Cumulative effect of accounting changes, net of income tax		(8,803	)		-
	_________			_________

Net loss		(31,480	)		(3,377	)
Preferred dividends		(6,553	)		(6,550	)
	_________			_________

Net loss applicable to common shareholders	$	(38,033	)	$	(9,927	)
	=========			=========
Net loss per common share
Basic and diluted before cumulative effect of accounting changes		$(0.50	)		$(0.17	)
Cumulative effect of accounting changes		(0.15	)		-
	_____			_____

Basic and diluted		$(0.65	)		$(0.17	)
	=====			=====
Pro forma amounts assuming accounting changes were applied retroactively (see Note 7)
Net loss	$	(31,480	)	$	(1,308	)
	=========			=========
Net loss per common share
Basic and diluted		$(0.65	)		$(0.14	)
	=====			=====

See accompanying notes to consolidated financial statements.

Boise Cascade Corporation and Subsidiaries
Consolidated Balance Sheets
(thousands)

	June 30						December 31
	___________________________						___________
	2003				2002		2002
	__________			___________			___________
	(unaudited)
ASSETS
Current
Cash and cash equivalents	$	98,240		$	79,044		$	65,152
Receivables, less allowances
of $14,338, $12,435, and $13,111		503,264			499,233			423,976
Inventories		648,831			623,340			717,966
Deferred income tax benefits		62,262			69,703			52,131
Other		41,485			45,651			36,524
	__________			___________			___________
		1,354,082			1,316,971			1,295,749
	__________			___________			___________
Property
Property and equipment
Land and land improvements		72,887			70,227			70,731
Buildings and improvements		749,141			698,577			709,127
Machinery and equipment		4,717,286			4,648,093			4,678,112
	__________			___________			___________
		5,539,314			5,416,897			5,457,970
Accumulated depreciation		(3,008,395	)		(2,843,525	)		(2,915,940	)
	__________			___________			___________
		2,530,919			2,573,372			2,542,030
Timber, timberlands, and timber deposits		321,414			314,567			328,720
	__________			___________			___________
		2,852,333			2,887,939			2,870,750
	__________			___________			___________

Goodwill		421,648			401,718			400,541
Investments in equity affiliates		35,980			36,245			35,641
Other assets		325,822			316,588			344,719
	__________			____________			___________
Total assets	$	4,989,865		$	4,959,461		$	4,947,400
	==========			============			===========

See accompanying notes to consolidated financial statements.

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

	June 30						December 31
	_______________________						___________
	2003			2002			2002
	_________			_________			___________
	(unaudited)
LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Short-term borrowings	$	1,000		$	30,700		$	28,000
Current portion of long-term debt		75,485			90,797			125,651
Income taxes payable		8,586			-			9,512
Accounts payable		558,896			519,285			519,596
Accrued liabilities
Compensation and benefits		205,700			147,063			218,085
Interest payable		25,167			29,068			29,928
Other		124,864			143,713			122,832
	_________			_________			___________
		999,698			960,626			1,053,604
	_________			_________			___________
Debt
Long-term debt, less current portion		1,494,410			1,413,699			1,387,398
Guarantee of ESOP debt		40,504			71,184			51,448
	_________			_________			___________
		1,534,914			1,484,883			1,438,846
	_________			_________			___________
Other
Deferred income taxes		169,023			284,877			165,357
Compensation and benefits		672,411			430,315			667,694
Other long-term liabilities		57,133			45,432			49,868
	_________			_________			___________
		898,567			760,624			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; 4,146,255, 4,387,327, and 4,280,615 shares outstanding		186,581			197,430			192,628
Deferred ESOP benefit		(40,504	)		(71,184	)		(51,448	)
Common stock -- $2.50 par value; 200,000,000 shares authorized; 58,313,553, 58,236,468, and 58,283,719 shares outstanding		145,784			145,591			145,709
Additional paid-in capital		475,215			471,940			474,533
Retained earnings		905,308			964,731			952,215
Accumulated other comprehensive loss		(288,198	)		(127,680	)		(314,106	)
	_________			_________			___________
Total shareholders' equity		1,384,186			1,580,828			1,399,531
	_________			_________			___________
Total liabilities and shareholders' equity	$	4,989,865		$	4,959,461		$	4,947,400
	=========			=========			===========

See accompanying notes to consolidated financial statements.

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

	Six Months Ended June 30
	__________________________
	2003			2002
	___________			___________
	(unaudited)
Cash provided by (used for) operations
Net loss	$	(31,480	)	$	(3,377	)
Items in net loss not using (providing) cash
Equity in net (income) loss of affiliates		(415	)		2,055
Depreciation, amortization, and cost of company timber harvested		149,312			151,424
Deferred income tax benefit		(19,971	)		(35,971	)
Pension and other postretirement benefits expense		41,092			18,635
Cumulative effect of accounting changes, net of income tax		8,803			- -
Other		(2,816	)		23,503
Receivables		(68,899	)		(72,288	)
Inventories		61,384			29,753
Accounts payable and accrued liabilities		18,912			10,398
Current and deferred income taxes		(7,499	)		(1,949	)
Pension and other postretirement benefits payments		(24,488	)		(4,917	)
Other		24,905			28,913
	___________			___________
Cash provided by operations		148,840			146,179
	___________			___________
Cash provided by (used for) investment
Expenditures for property and equipment		(108,001	)		(96,120	)
Expenditures for timber and timberlands		(4,264	)		(4,505	)
Investments in equity affiliates		76			-
Purchases of facilities		-			(1,406	)
Other		(3,460	)		(24,522	)
	___________			___________
Cash used for investment		(115,649	)		(126,553	)
	___________