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CASCADE CORPORATION ANNOUNCES FINANCIAL RESULTS FOR THE SECOND QUARTER ENDED JULY 31, 2007

Cascade Corporation (NYSE: CAE) today reported its financial results for the second quarter ended July 31, 2007.

Overview

·Net sales of $143.2 million for the second quarter of fiscal 2008 were 20% higher than net sales of $119.4 million for the prior year quarter.

·Net income of $15.1 million ($1.21 per diluted share) for the second quarter of fiscal 2008 was 27% higher than net income of $11.9 million ($0.91 per diluted share) for the second quarter of fiscal 2007. Excluding the effect of the gain on land sale, net income was $1.16 per diluted share (see separate reconciliation calculation).

·The increase in net income reflects the overall strength of lift truck markets globally, where shipments were up 10%.

Second Quarter Fiscal 2008 Summary

·Summary financial results are outlined below (in thousands, except earnings per share):



·Excluding our acquisitions and the impact of foreign currency changes, consolidated net sales increased 11% during the second quarter of fiscal 2008. This increase was primarily the result of higher levels of business activity in Europe, Asia Pacific and China. Details of the net sales increase over the prior year second quarter follow (in millions):

·The majority of the increase in SG&A was attributable to changes in foreign currencies, higher selling and marketing costs in Europe and additional costs because of the acquisition of Pacific Services and Manufacturing, Inc. in the fourth quarter of fiscal 2007 and the acquisition of American Compaction Equipment, Inc. in the second quarter of fiscal 2008.

·During the second quarter of fiscal 2008 we realized a gain of $1.1 million on the sale of land in Fairview, Oregon.

·The fiscal 2008 effective tax rate of 33% is lower than the 35% for the second quarter of the prior year. The change was primarily related to proportionally higher income levels in fiscal 2008 in China, which has a lower tax rate compared to other Cascade locations.

Market Conditions

·Percentage changes in lift truck industry shipments, by region, as compared to the prior year are outlined below. Although lift truck unit shipments are an indicator of the general health of the industry, they do not necessarily correlate directly with the demand for our products.



		Second Quarter*
North America		(4%)
Europe		20%
Asia Pacific		6%
China		17%


*Represents calendar year data

·The lift truck market outlook is for shipments to follow current trends through the remainder of the year.

North America Summary

·Summary financial results are outlined below (in thousands):



·Excluding sales related to our acquisitions, North America’s net sales increased 2%. Details of the increase over the prior year quarter follows (in millions):



·The gross profit percentage of 35% was 1% lower then the prior year second quarter due to lower margins from acquired companies.

·Selling and administrative and amortization costs increased due to our recent acquisitions.

·During the second quarter of fiscal 2008 we realized a gain of $1.1 million on the sale of land in Fairview, Oregon.

·Operating income during fiscal 2008, excluding the gain on land sale, increased 10%.

Europe Summary

·Summary of financial results are outlined below (in thousands):



·Details of the net sales increase over the prior year quarter follow (in millions):



·The increase in sales in Europe can be primarily attributed to a strong European lift truck market.

·The gross profit percentage in Europe was consistent compared to the prior year. We were able to offset material cost increases with better fixed cost absorption due to higher sales and production levels.

·Excluding the impact of currency changes, selling and administrative expenses increased 11% in Europe due to higher selling costs associated with increased sales volumes and expanded marketing activities.

Asia Pacific Summary

·Summary financial results are outlined below (in thousands):



·The sales increase in the Asia Pacific region occurred in all locations throughout the region. Details of the net sales increase over the prior year quarter follows (in millions):



·Selling and administrative costs decreased 1% in the current year, excluding the impact of currency changes, due to general cost decreases in the current year.

China Summary

·Summary financial results are outlined below (in thousands):



·The net sales increase in China is due to a very strong Chinese lift truck market and our recent expansion plan in China which increased our capabilities to produce a larger volume of products. Details of the increase over the prior year quarter follows (in millions):



·Gross margin percentages in China increased to 34% from 33% in the prior year. This increase reflects the benefit of sourcing certain raw materials and components from within China, which is offset by lower margins due to product and customer mix.

·Selling and administrative costs increased 33% excluding currency changes. This increase is due to additional costs to support our expanding Chinese operations.

Other Matters:

·On September 5, 2007, our Board of Directors declared a quarterly dividend of $0.18 per share, payable on October 19, 2007 to shareholders of record as of October 4, 2007.

·The calculation of diluted earnings per share excluding the land sale gain is as follows (in thousands, except per share amount):



·During the first quarter of fiscal 2008, we settled an insurance litigation matter for $16 million. This recovery, net of tax, increased the six month diluted earnings per share by $0.80.

Forward Looking Statements:

This press release contains forward-looking statements made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Readers are cautioned that a number of factors could cause our actual results to differ materially from any results indicated in this release or in any other forward-looking statements made by us, or on our behalf. These include among others factors related to general economic conditions, interest rates, demand for materials handling products and construction equipment, performance of our manufacturing facilities and the cyclical nature of the materials handling and construction equipment industries. Further, historical information should not be considered an indicator of future performance. Additional considerations and important risk factors are described in our reports on Form 10-K and 10-Q and other filings with the Securities and Exchange Commission.

Earnings Call Information:

We will discuss our results in a conference call on Thursday, September 6, 2007 at 2:00 pm PDT. Robert C. Warren, Jr., President and Chief Executive Officer will host the call. The conference call can be accessed in the U.S. and Canada by dialing (800) 218-0204, International callers can access the call by dialing (303) 262-2125. Participants are encouraged to dial-in 15 minutes prior to the beginning of the call. A replay will be available for 48 hours after the live broadcast and can be accessed by dialing (800) 405-2236 and entering passcode 11095872#, or internationally, by dialing (303) 590-3000 and entering passcode 11095872#.

The call will be simultaneously webcast and can be accessed on the Investor Relations page of the company’s website, www.cascorp.com. Listeners should go to the website at least 15 minutes early to register, download and install any necessary audio software.

About Cascade Corporation:

Cascade Corporation, headquartered in Fairview, Oregon, is a leading international manufacturer of materials handling products used primarily on lift trucks. Additional information on Cascade is available on its website, www.cascorp.com.

Contact
Richard S. "Andy" Anderson
Senior Vice President and Chief Financial Officer
Cascade Corporation
Phone (503) 669-6300

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