FORM 10-Q
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                  FOR THE QUARTERLY PERIOD ENDED:  APRIL 30,JULY 31, 2000

                                       OR

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

                  FOR THE TRANSITION PERIOD FROM ________________________________________________

Commission file number: 0-3136

                             RAVEN INDUSTRIES, INC.
      - ---------------------------------------------------------------------------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


          SOUTH DAKOTA                                 46-0246171
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 (State or other jurisdiction of          (I.R.S. Employer Identification No.)
 incorporation or organization)

                               205 EAST 6TH STREET
                                  P.O. BOX 5107
                           SIOUX FALLS, SD 57117-5107
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               (Address of principal executive offices) (Zip code)

                                  605-336-2750
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               Registrant's telephone number, including area 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______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.

CLASS                                     OUTSTANDING AS OF MAYAUGUST 31, 2000
- ---------------------------           --------------------------------------------------------------------           -------------------------------------------

Common Stock                                      3,563,4073,301,107 shares




                             RAVEN INDUSTRIES, INC.

                                      INDEX



                                                                        PAGE NO.
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PART I-FINANCIALI - FINANCIAL INFORMATION

Consolidated Balance Sheet as of April 30,July 31, 2000,
     January 31, 2000 and April 30,July 31, 1999                                      3

Consolidated Statement of Income for the three
     monthsand six month periods ended April 30,July 31, 2000 and 1999                      4

Consolidated Statement of Cash Flows for the three monthssix
     month periods ended April 30,July 31, 2000 and 1999                              5

Notes to Consolidated Financial Statements                                 6-7

Management's Discussion and Analysis of Financial
     Condition and Results of Operations                                   8-9

PART II-OTHERII - OTHER INFORMATION                                                 10




                         PART I - FINANCIAL INFORMATION

                             RAVEN INDUSTRIES, INC.
                           CONSOLIDATED BALANCE SHEET
                  Dollars(Dollars in thousands, except per share datadata)

04/30/07/31/00 01/31/00 04/30/07/31/99 -------- -------- ------------------- ----------- ----------- (unaudited) (unaudited) ASSETS - ------ Cash and cash equivalents .............................................................................. $ 1,8661,956 $ 5,707 $ 2,0551,804 Accounts and note receivable, less allowance for doubtful accounts of $461,000, $400,000$422, $400 and $401,000$453 as of 04/30/07/31/00, 01/31/00 and 04/30/07/31/99, respectively .................. 22,687................ 20,273 22,717 24,27222,209 Inventories net: Materials ...................................................... 17,417.................................................... 18,621 16,260 20,41919,769 In process ..................................................... 6,232................................................... 4,300 4,997 5,2045,372 Finished goods ................................................. 3,538............................................... 4,365 3,205 6,010 -------- -------- --------8,496 ----------- ----------- ----------- Total inventories net ..................................... 27,187........................................ 27,286 24,462 31,63333,637 Deferred income taxes ............................................ 2,010.......................................... 2,070 1,919 1,1321,164 Prepaid expenses and other current assets ........................ 536...................... 563 566 269 -------- -------- --------192 ----------- ----------- ----------- Total current assets ....................................... 54,286..................................... 52,148 55,371 59,36159,006 ----------- ----------- ----------- Property, plant and equipment .................................... 49,552.................................. 37,482 48,949 58,05858,915 Less accumulated depreciation .................................. 34,89325,649 33,881 39,007 -------- -------- --------40,067 ----------- ----------- ----------- Property, plant and equipment, net ......................... 14,659....................... 11,833 15,068 19,05118,848 Other assets, net ................................................ 3,592.............................................. 1,725 3,608 3,734 -------- -------- -------- Total3,679 Noncurrent assets .....................................................held for sale ................................ 4,779 ----------- ----------- ----------- TOTAL ASSETS ................................................... $ 72,53770,485 $ 74,047 $ 82,146 ======== ======== ========81,533 =========== =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY - ------------------------------------ Notes payable, bank ............................................ $ 3,500 $ 2,000 Current portion of long-term debt ................................ $ 33.............................. 1,023 $ 1,044 $ 6081,555 Accounts payable ................................................. 5,969............................................... 5,009 5,320 5,4185,264 Accrued liabilities and customer advances ........................ 8,941...................... 8,204 8,338 8,792 -------- -------- --------8,034 ----------- ----------- ----------- Total current liabilities .................................. 14,943................................ 17,736 14,702 14,81816,853 Long-term debt, less current portion ............................. 3,012........................... 2,013 3,024 3,9923,035 Other liabilities, primarily compensation and benefits ........... 1,987......... 2,039 1,802 1,775 Commitments and contingencies1,883 Stockholders' equity Common stock, $1.00$1 par value, 100,000,000 authorized shares: 100,000,000 issued: 5,218,114; 5,218,114 and 5,215,489 shares as of 04/30/07/31/00, 01/31/00 and 04/30/07/31/99, respectively .................... 5,218 5,218 5,215 Paid-in capital .............................................................................................. 3,177 3,177 2,961 Retained earnings .............................................. 65,259............................................ 65,859 64,236 61,060 -------- -------- -------- 73,65462,146 ----------- ----------- ----------- 74,254 72,631 69,23670,322 Less treasury stock, at cost 1,522,707;cost: 1,853,207; 1,302,007 and 623,203816,098 shares as of 04/30/07/31/00, 01/31/00 and 04/30/07/31/99, respectively ........................ 21,059...................... 25,557 18,112 7,675 -------- -------- --------10,560 ----------- ----------- ----------- Total stockholders' equity ................................. 52,595............................... 48,697 54,519 61,561 -------- -------- -------- Total liabilities and stockholders' equity .......................59,762 ----------- ----------- ----------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ..................... $ 72,53770,485 $ 74,047 $ 82,146 ======== ======== ========81,533 =========== =========== ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS. Page 3 PART I - FINANCIAL INFORMATION RAVEN INDUSTRIES, INC. CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) Dollars(Dollars in thousands, except per share data FOR THE THREE MONTHS ENDED: ----------------------- 04/30/00 04/30/99 --------- --------- Net sales ...................................... $ 31,544 $ 34,495 Cost of goods sold ............................. 25,277 28,484 --------- --------- Gross profit ................................. 6,267 6,011 Operating expenses Selling ...................................... 1,774 1,972 Administrative ............................... 1,894 1,781 --------- --------- Operating income .......................... 2,599 2,258 Interest expense ............................... (57) (103) Other income, net .............................. 79 97 --------- --------- Income before income taxes ................... 2,621 2,252 Income taxes ................................... 944 813 --------- --------- Net income ................................... $ 1,677 $ 1,439 ========= ========= Net income per common share: Basic ................................. $ 0.44 $ 0.31 Diluted ............................... $ 0.44 $ 0.31per-share data)
FOR THE THREE FOR THE SIX MONTHS ENDED MONTHS ENDED --------------------------- --------------------------- 07/31/00 07/31/99 07/31/00 07/31/99 ----------- ----------- ----------- ----------- Net sales ......................... $ 32,386 $ 36,965 $ 63,930 $ 71,460 Cost of goods sold ................ 27,236 30,377 52,513 58,861 ----------- ----------- ----------- ----------- Gross profit .................... 5,150 6,588 11,417 12,599 Operating expenses Selling ......................... 1,732 2,020 3,505 3,992 Administrative .................. 1,567 1,765 3,462 3,546 ----------- ----------- ----------- ----------- Operating income ................ 1,851 2,803 4,450 5,061 Interest expense .................. (64) (89) (121) (192) Other income, net ................. 45 128 124 225 ----------- ----------- ----------- ----------- Income before income taxes ...... 1,832 2,842 4,453 5,094 Income taxes ...................... 659 1,026 1,603 1,839 ----------- ----------- ----------- ----------- Net income ...................... $ 1,173 $ 1,816 $ 2,850 $ 3,255 =========== =========== =========== =========== Net income per common share: Basic .................... $ 0.34 $ 0.40 $ 0.78 $ 0.71 Diluted .................. $ 0.34 $ 0.40 $ 0.78 $ 0.71 Cash dividends declared and paid per share ..... $ 0.17 $ 0.16 $ 0.34 $ 0.32
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS. Page 4 PART I - FINANCIAL INFORMATION RAVEN INDUSTRIES, INC. CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED) (Dollars in thousands)
FOR THE THREESIX MONTHS ENDED: --------------------- 04/30/ENDED --------------------------- 07/31/00 04/30/07/31/99 -------- ------------------- ----------- Cash flows from operating activitiesCASH FLOWS FROM OPERATING ACTIVITIES Net income ................................................. $ 1,6772,850 $ 1,4393,255 Adjustments to reconcile net income to net cash provided by operating activitiesactivities: Depreciation and amortization .......................... 1,098 1,3802,184 2,758 Provision for losses on accounts receivable ............ 139 2173 124 Deferred income taxes .................................. (161) 4(236) (65) Change in accounts and interest receivable ............. (266) 3,1252,063 5,066 Change in inventories .................................. (2,725) (5,655)(2,824) (7,659) Change in prepaid expenses and other current assets .... 30 1483 225 Change in operating liabilities ........................ 1,503 273(208) (531) Other .................................................. (17) -------- --------16 12 ----------- ----------- Net cash provided by operating activities .................. 1,295 699 Cash flows from investing activities4,021 3,185 CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures ....................................... (603) (782)(1,783) (1,874) Proceeds from the sale of Glasstite assets ................. 157208 Other ...................................................... (66) 27 -------- --------8 7 ----------- ----------- Net cash used in investing activities ...................... (512) (755) Cash flows from financing activities(1,567) (1,867) CASH FLOWS FROM FINANCING ACTIVITIES Issuance of short-term debt ................................ 3,500 2,000 Long-term debt principal payments .......................... (1,023) (1,032)(1,033) (1,042) Dividends paid ............................................. (654) (748)(1,227) (1,478) Purchase of treasury stock ................................. (2,947) (1,444) -------- --------(7,445) (4,329) ----------- ----------- Net cash used in financing activities ...................... (4,624) (3,224) -------- --------(6,205) (4,849) ----------- ----------- Net decrease in cash and cash equivalents .................. (3,841) (3,280)(3,751) (3,531) Cash and cash equivalents at beginning of period ............. 5,707 5,335 -------- ------------------- ----------- Cash and cash equivalents at end of period ................... $ 1,8661,956 $ 2,055 ======== ========1,804 =========== ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS. Page 5 PART I - FINANCIAL INFORMATION RAVEN INDUSTRIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) 1. The accompanying unaudited consolidated financial statements have been prepared by Raven Industries, Inc. (the company) in accordance with accounting principles generally accepted in the United States for interim financial information and the instructions to formForm 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (SEC). Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentationrepresentation have been included. Financial results for the three-month periodthree and six-month periods ended April 30,July 31, 2000 are not necessarily indicative of the results that may be expected for the year ending January 31, 2001. The January 31, 2000 consolidated balance sheet was derived from audited financial statements, but does not include all consolidated disclosuredisclosures required by accounting principles generally accepted in the United States. These financial statements should be read in conjunction with the consolidated financial statementsstatement and notes included in the company's annual report on Form 10-K for the year ended January 31, 2000. 2. Certain reclassifications have been made to the April 30,July 31, 1999 consolidated balance sheet to conform to the current year presentation. These reclassifications had no impact on stockholders' equity or the company's results of operations. 3. 269,800Options to purchase 266,300 and 242,100 optionsshares of the Company's common stock were excluded from the diluted earnings per share calculation on April 30,calculations for the periods ended July 31, 1999 and April 30,July 31, 2000, respectively, because their excerciseexercise prices were greater than the average market price of the company's common stock during the period.those periods. Details of the earnings per share computation are presented below (dollars in(in thousands, except per share data). FOR THE THREE MONTHS ENDED: ------------------------ 04/30/00 04/30/99 ---------- ---------- Net income ............................... $ 1,677 $ 1,439:
FOR THE THREE FOR THE SIX MONTHS ENDED MONTHS ENDED ---------------------------------------------------- 07/31/00 07/31/99 07/31/00 07/31/99 ---------- ---------- ---------- ---------- Net income ............................... $ 1,173 $ 1,816 $ 2,850 $ 3,255 ========== ========== ========== ========== Weighted average common shares outstanding ........................... 3,475 4,510 3,647 4,581 Dilutive impact of stock options ......... 0 0 0 0 ---------- ---------- ---------- ---------- Weighted average common and common equivalent shares outstanding ........ 3,475 4,510 3,647 4,581 ========== ========== ========== ========== Net income per share Basic ............................... $ 0.34 $ 0.40 $ 0.78 $ 0.71 ========== ========== ========== ========== Diluted ............................. $ 0.34 $ 0.40 $ 0.78 $ 0.71 ========== ========== ========== ========== Weighted average common shares outstanding ............................ 3,823,361 4,652,019 Dilutive impact of stock options ......... 0 0 ---------- ---------- Weighted average common and common equivalent shares outstanding .......... 3,823,361 4,652,019 ========== ========== Net income per share Basic ................................ $ 0.44 $ 0.31 ========== ========== Diluted .............................. $ 0.44 $ 0.31 ========== ==========
Page 6 PART I - FINANCIAL INFORMATION RAVEN INDUSTRIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) 4. The company's three reportable segments (Electronics, Plastics and Sewn Products) are defined by their common technologies, raw materials and production processes. These segments are consistent with the company's management reporting structure. The company's customers (distributors or original equipment manufacturers) provide opportunities for each segment to serve various markets. Distribution methods are similar across and within segments. These segments' results are shown below. FOR THE THREE MONTHS ENDED: ----------------------- 04/30/00 04/30/99 --------- --------- NET SALES --------- Electronics ................. $ 14,121 $ 12,917 Plastics .................... 13,965 18,610 Sewn Products ............... 3,458 2,968 --------- --------- Total company ................. $ 31,544 $ 34,495 ========= ========= OPERATING INCOME ---------------- Electronics ................. $ 1,457 $ 866 Plastics .................... 1,325 1,575 Sewn Products ............... (183) (183) --------- --------- Total company ................. $ 2,599 $ 2,258 ========= =========
FOR THE THREE FOR THE SIX MONTHS ENDED MONTHS ENDED ------------------------------------------------------ 07/31/00 07/31/99 07/31/00 07/31/99 ---------- ---------- ---------- ---------- NET SALES - --------- Electronics ............... $ 10,964 $ 11,917 $ 25,085 $ 24,834 Plastics .................. 15,113 19,368 29,078 37,978 Sewn Products ............. 6,309 5,680 9,767 8,648 ---------- ---------- ---------- ---------- Total company ................... $ 32,386 $ 36,965 $ 63,930 $ 71,460 ========== ========== ========== ========== OPERATING INCOME (LOSS) - ----------------------- Electronics ............... ($ 395) $ 716 $ 1,062 $ 1,582 Plastics .................. 2,115 1,700 3,440 3,275 Sewn Products ............. 131 387 (52) 204 ---------- ---------- ---------- ---------- Total company ................... $ 1,851 $ 2,803 $ 4,450 $ 5,061 ========== ========== ========== ==========
5. During the firstsecond quarter of fiscal 2001, the company repaid $1.0committed to a plan to sell its Plastic Tank division, part of the company's Plastics Segment. Accordingly, the non-current assets of these operations of $4,779,000, consisting primarily of property, plant, equipment and certain intangible assets, were reclassified as assets held for sale as of July 31, 2000. In addition, the company is selling certain current assets of the division. The Plastic Tank division is expected to be sold during the company's third quarter of fiscal 2001. Based on signed letters of intent, the cash proceeds of the sale are expected to be approximately $11.5 million, resulting in an expected after-tax gain on the sale of its debt originally dueapproximately $1.5 million to be recognized in the company's third quarter. Certain liabilities of the company will be assumed by the buyers. In August 2000, the company did sell certain net assets of the Plastic Tank division and received approximately $11.0 million at the closing. Sales and operating income (before allocation of certain administrative expense) of the company's Plastic Tank division were approximately $10.8 million and $830,000, respectively, for the six month period ended July 31, 2000 and $18.2 million and $100,000, respectively for the year ended January 31, 2000. 6. In June 2000, the company entered into a new agreement with Norwest Bank South Dakota, N.A. (Norwest) to increase the short-term credit line to $7.0 million. The terms of this credit line are similar to the $5.0 million line with Norwest that expired on June 30, 2000. At July 31, 2000, the company had borrowings of $3.5 million outstanding under this line of credit. Page 7 PART I - FINANCIAL INFORMATION MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FINANCIAL CONDITION The company's cash and cash equivalents balance of $1.9was $2.0 million at April 30, 2000 was $3.8 million less than JanuaryJuly 31, 2000, and $189,000 lower than April 30, 1999. There were no borrowings againstcompared with $1.8 million one year earlier. As of July 31, 2000, the company's long term debt, including the current portion, was $3.0 million compared to $4.6 million the prior year. The company obtained short term financing in the amount of $3.5 million during the second quarter of fiscal year 2001 in order to help fund the repurchase of common shares. At July 31, 2000, the company retained an unused balance of $3.5 million on its $7.0 million line of credit ascredit. During the second quarter, the company repurchased 330,500 shares of April 30, 2000, whichits common stock. The average purchase price was $13.61 per share for a total cost of $4.5 million. The company purchased 551,200 shares at an average purchase price of $13.51 for a total of $7.4 million during the same as Januarysix months ended July 31, 2000 and April 30, 1999. The cash balance as of January 31, 2000 was sufficient to fund the seasonal increases in inventory levels and prepay $1.0 million of long-term debt due in June 2000. Inventory levels declined $4.4decreased $6.4 million from April 30,the July 31, 1999 to April 30, 2000,level due primarily to the sale of the assets of ourthe Glasstite subsidiary and the sale of the skiwear line in fiscal 2000. From April 30, 1999 through April 30, 2000,As described in footnote 5 to the consolidated financial statements, the sale of the assets of the company's Plastic Tank Division is expected to be completed during the third quarter ending October 31, 2000. These transactions should generate approximately $9 million of cash after income taxes are paid. In addition, certain liabilities of the company repurchased 899,504 shares ofwill be assumed by the buyers. After repaying its common stock for a total of $13.4 million, including $2.9 million inshort term borrowings, the quarter ended April 30, 2000. The company had $3.0 million in long-term debt at April 30, 2000, includingintends to use the current portion, down from $4.6 million at April 30, 1999.proceeds to expand its core businesses and repurchase its own shares. The company's capital resources continue to be sufficient to fund all its activities. RESULTS OF OPERATIONS Sales were $32.4 million for the quarter ended April 30,July 31, 2000, were $31.5 million, down $3.0$4.6 million from the previous year's results,results. The decrease was due primarily to the sale of ourthe company's Glasstite subsidiary in fiscal 2000. Glasstiteyear 2000, which contributed $6.1 million of sales forin the first quarter last year totaled $5.7 million.prior year's second quarter. After adjusting last fiscal year's first quarter results for the Glasstite sale, sales increased $2.7$1.5 million this quarter. MostThe Plastics segment generated sales increases over last year for the second quarter. After adjusting last year's operating income for Glasstite's contribution of this sales increase$788,000, operating income for the first six months was generated in our Electronics and Plastics segments.4 percent higher than the prior year. Net income for the second quarter decreased $.6 million from $1.8 million one year earlier. The decrease was due to the sale of the Glasstite subsidiary combined with lower sales and production efficiencies in the Electronics segment. Earnings per share, on a diluted basis, were 34 cents a share, compared to 40 cents a share in the second quarter of last year. For the first six months of the year, net income was $2.9 million, or 78 cents per diluted share, versus $3.3 million, or 71 cents per diluted share, last year. Electronics segment sales of $11.0 million in the second quarter was $1.7 million, $238,000 superiorwere $953,000 below the same period last year. Sales of feedmill automation systems fell $523,000 due to last year's first quarter. Last year's results included Glasstite's contributiona downturn in the agricultural market demand for new systems. Lower contract electronic sales were a result of $381,000an unexpected decline in demand from a PC-board customer. The Electronics segment experienced an operating loss during the quarter of $395,000, compared to operating income.income of $716,000 for the same period last year. The numberlower sales and additional one-time costs in the new Sioux Falls Electronics facility caused the loss of shares outstandingearnings. For the first six months, sales totaled $25.1 million compared to $24.8 million for the same period in fiscal 2000. Operating income for the first quarter ended April 30, 2000, compared tohalf of fiscal 2001 was $1.1 million, down $520,000 from the first quarter April 30, 1999, was down 899,504 sharesprior year. The six-month decrease in earnings is primarily due to the company's on-going repurchaseshortfalls in the second quarter, partially offset by strong shipments of stock. Earnings per diluted share climbedflow control devices to a first quarter record-tying $0.44 from $0.31the agricultural market in the first quarter of the previouscurrent fiscal year. Electronics segment sales of $14.1 million in the first quarter were 9 percent higher than one year earlier. Sales of flow control devices increased by more than $1.0 million in the first quarter, due primarily to increased product recognition in the marketplace and aggressive marketing. Management remains cautious about the sustainability of this demand in what continues to be a weak agricultural marketplace. Sales of feedmill automation systems were down 13 percent, due to the continuing poor ag economy. Contract electronics showed excellent gains during the first quarter, logging a 9 percent increase in sales over last year's total, due primarily to heavy deliveries of a long-term contract relating to the computer industry. First quarter operating income for the Electronics segment was $1.5 million, up 68 percent from last year's $866,000. This increase is due to improved sales of higher-margin products along with higher sales volumes, which allow for improved factory utilization and labor efficiencies. Page 8 PART I - FINANCIAL INFORMATION MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Plastics segment sales of $14.0$15.1 million in the quarter ended April 30,July 31, 2000 compared to $18.6$19.4 million last year, and $12.9$13.3 million after adjusting for Glasstite's firstsecond quarter 1999fiscal 2000 sales, or an increase in Plastic segment sales of $1.1$1.8 million. All of thisThe sales increase was generatedthe result of increased market share in our engineered films product line due to increased market share. Sales of plasticand a rebounding demand for dual-laminate tanks were down slightly, due primarily to continuing weak agricultural demand. Operatingin the semiconductor industry. Plastics segment operating income for the second quarter was $2.1 million, a 24 percent increase above the prior year. Excluding Glasstite's contribution of $407,000 in the first six months of fiscal 2000, operating income was up 64 percent from the prior year. The improvements in operating income are primarily due to better plant utilization from increased sales volume. Plastics segment sales for the first half of fiscal 2001 were $29.1 million compared to $38.0 million in fiscal 2000. First half sales in fiscal 2001 were up 11 percent after adjusting for Glasstite sales in the prior year's first half. Operating income was $1.3 million, down 16up 38 percent from the prior fiscal year results of $2.5 million, after adjusting for the Glasstite sale of $3.4 million. Sewn Products segment sales of $6.3 million for the second quarter were $629,000 above the $5.7 million recorded in the same period last year. Year-to-date sales of $9.8 million were 13 percent above the first half results of fiscal 2000. For the quarter, operating income was $131,000 compared to $387,000 the prior year, and year-to-date operating loss was $52,000, compared to operating income of $204,000 in last year's $1.6first half. This segment continued to experience offshore competitive pressures. The first half of the year is the seasonal low for the Sewn Products segment. Consolidated gross profits of $5.2 million which included Glasstite's contribution to $381,000 of operating income in the firstsecond quarter were $1.4 million below the second quarter of last year. Sewn Products segment sales are typically at a seasonal lowThe first six months generated gross profits of $11.4 million compared to $12.6 million the prior year. Selling expenses were down $288,000 for the quarter and $487,000 in the first quarterhalf of fiscal 2001 due to the sale of the fiscal year. First quarter sales of $3.5 millionGlasstite subsidiary and the skiwear line. Administrative expenses were up $490,000 over last year's $3.0 million. The sales increase was due to off-season contracts obtained to provide work for our factories. The operating lossdown $198,000 for the segment was unchanged from last year at $183,000. This loss is the result of the less profitable off-season business. Management does not expect first quarter results to be representative of the full year. Although full-year sales are expected to decline from last year's $28 million for this segment, management expects the segment will generate an operating profit during that timeframe. Consolidated gross profits of $6.3 million in the first quarter were 4 percent higher than the prior year's first quarter,and $84,000 on a year-to-date basis, due again primarily to the strong performancesale of the Electronics segment. Selling expenses wereGlasstite subsidiary. Second quarter pretax income of $1.8 million was $1.0 million below the same period last year. The pretax income for the first six months was $4.5 million compared to $5.1 million last year. These results generated a 10 percent lower than the prior year because of the sale of our Glasstite subsidiary operation and of the company's proprietary skiwear product line, which had higher selling expenses than other businesses of the company. Administrative expenses were 6 percent higher than the previous year reflecting increased bad debt and benefits expenses. Pretax income of $2.6 million was 16 percent greater than the first quarter of the priorincrease in year-to-date earnings per diluted share, rising from 71 cents in fiscal year.2000 to 78 cents in fiscal 2001. The increase in earnings per share results from fewer shares outstanding. The company repurchased 1,037,109 shares from July 1999 to July 2000. FORWARD-LOOKING STATEMENTS THIS REPORT CONTAINS DISCUSSIONS OF ITEMS WHICH MAY CONSTITUTE FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF FEDERAL SECURITIES LAWS. ALTHOUGH RAVEN INDUSTRIES BELIEVES THAT EXPECTATIONS REFLECTED IN SUCH FORWARD-LOOKING STATEMENTS ARE BASED ON REASONABLE ASSUMPTIONS, IT CAN GIVE NO ASSURANCES THAT ITS EXPECTATIONS WILL BE ACHIEVED. FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER FROM EXPECTATIONS INCLUDE GENERAL ECONOMIC CONDITIONS, WEATHER CONDITIONS WHICH COULD AFFECT CERTAIN OF THE COMPANY'S PRIMARY MARKETS SUCH AS THE AGRICULTURAL MARKET OR ITS MARKET FOR OUTERWEAR, OR CHANGES IN COMPETITION WHICH COULD IMPACT ANY OF THE COMPANY'S PRODUCT LINES. Page 9 PART II - OTHER INFORMATION Item 1. Legal Proceedings: None The company is involved as a defendant in lawsuits, claims or disputes arising in the normal course of business. The settlement of such claims cannot be determined at this time. Management believes that any liability resulting from these claims will be substantially mitigated by insurance coverage. Accordingly, management does not believe the ultimate outcome of these matters will be significant to its results of operations, financial position or cash flows. Item 2. Changes in Securities: None Item 3. Defaults upon Senior Securities: None Item 4. Submission of Matters to a Vote of Security Holders: None.The Company's annual meeting of stockholders was held on May 24, 2000. The following members were elected to the company's Board of Directors to hold office for the ensuing year. Nominee In Favor Withheld - --------------------------- ----------- ----------- Anthony W. Bour 2,995,619 33,655 David A. Chirstensen 2,999,291 29,983 Thomas S. Everist 2,987,389 41,885 Mark E. Griffin 2,996,003 33,271 Conrad J. Hoigaard 2,995,683 33,591 Kevin T. Kirby 2,996,203 33,071 Ronald M. Moquist 2,991,332 37,942 The shareholders approved the Company's 2000 Stock Option and Compensation Plan with 2,376,179 votes in favor, 102,615 votes against, 24,002 abstentions and 526,478 broker non-votes. Item 5. Other Information: None Item 6. (a) Exhibits Filed: Exh. 27-Financial Data schedule (for SEC only). (b) Reports on Form 8-K: None 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. RAVEN INDUSTRIES, INC. /s/ Thomas Iacarella ----------------------------------------- Thomas Iacarella Vice President, Finance, Secretary and Treasurer (Principal Financial DATE: SEPTEMBER 7, 2000 and Accounting Officer) DATE: JUNE 5, 2000 Page 10