Cascade Corporation says its 2002 forklift orders and shipments will, subject to economic conditions, maintain last year's pace or improve moderately.

Cascade said, in a US Securities & Exchange Commission year-to-January 31 financial report that, while sales were 16.1 percent lower, the company maintained comparable gross margins "through aggressive cost-management initiatives. The company anticipates overall profitability of continuing operations".

Cascade posted a USD4.1 million profit on sales of USD252.7 million, down from USD11.9 million profit on USD301.4 million in sales in 2000. The Cascade report included the fiscal-2002 profit of its hydraulic cylinder division, which was sold in January, but excluded the division's sales.

"This decline reflects the reduced order rates for lift trucks throughout the world," the company said. Cascade sales to customers in North America were down 17.4 percent and down 13.3 percent in Europe.

Cascade's "aggressive cost-management initiatives" included reducing material costs, cutting work schedules, reducing production and administrative staffing and, last October, instituting a pay freeze which is still in effect, the report said. Cascade did not give incentive payments to its most highly-paid executives.

Cascade sold the hydraulic cylinder division to Precision Hydraulic Cylinders Inc for USD13 million on January 15. The deal involved manufacturing and sales operations in Beulaville, North Carolina, USA, and Cramlington, England.

Cascade's environmental litigation continues. In March, the City of Portland filed an additional claim of up to USD10 million against Cascade and The Boeing Company for groundwater contamination. If the city wins, the combined liability of Cascade and Boeing would be about USD32.5 million. Portland filed its initial claim in December 1999. Insurance policies provide coverage for only a minor portion of any potential Cascade liability.

In the fourth quarter, Cascade recorded a USD5.1 million write-down of its Australian operations. Cascade said it saw reduced orders in Australia and, between August and January, reduced its workforce there by 38 employees, or 40 percent.

"These declines have occurred despite the fact that the Australian lift truck market was not experiencing the downturn in order rates that existed in North America and Europe," the company said.

At January 31 this year, Cascade employed about 1400 people, down 13 percent from January 31, 2001.