UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

(Mark One)

or

[ ] Transition Report Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934

Commission file number: 1-12123

JLG INDUSTRIES, INC.

Registrant’s telephone number, including area code:
(7l7) 485-5161

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 [   ]

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes [X] No [   ]

The number of shares of capital stock outstanding as of May 21, 2004 was 43,668,340.

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION

JLG INDUSTRIES, INC.

The accompanying notes are an integral part of these financial statements.

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JLG INDUSTRIES, INC.

The accompanying notes are an integral part of these financial statements.

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JLG INDUSTRIES, INC.

The accompanying notes are an integral part of these financial statements.

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JLG INDUSTRIES, INC.

NOTE 1 - BASIS OF PRESENTATION/SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and notes required by generally accepted accounting principles for complete financial statements. In our opinion, the unaudited condensed consolidated financial statements include all adjustments, consisting only of normal recurring accruals, considered necessary for a fair presentation of the financial position and the results of operations.

Interim results for the nine-month period ended April 30, 2004 are not necessarily indicative of the results that may be expected for the fiscal year as a whole. For further information, refer to the consolidated financial statements and notes thereto included in our annual report on Form 10-K/A for the fiscal year ended July 31, 2003.

Where appropriate, we have reclassified certain amounts in fiscal 2003 to conform to the fiscal 2004 presentation. We have also amended or supplemented the significant accounting policies included in our annual report on Form 10-K/A for the fiscal year ended July 31, 2003 with the following.

Revenue Recognition

Sales of non-military equipment and service parts are unconditional sales that are recorded when product is shipped and invoiced to independently owned and operated distributors and customers. Normally our sales terms are “free-on-board” shipping point (FOB shipping point). However, certain sales, including our All-Terrain Lifter, Army System (“ATLAS”) brand of military telehandler products, may be invoiced prior to the time customers take physical possession. In such cases, revenue is recognized only when the customer has a fixed commitment to purchase the equipment, the equipment has been completed and made available to the customer for pickup or delivery, and the customer has requested that we hold the equipment for pickup or delivery at a time specified by the customer. In such cases, the equipment is invoiced under our customary billing terms, title to the units and risks of ownership passes to the customer upon invoicing, the equipment is segregated from our inventory and identified as belonging to the customer and we have no further obligations under the order other than customary post-sales support activities. In the instances that our shipping terms are “shipping point destination,” revenue is recorded at the time the goods reach our customers.

The sales terms for our ATLAS brand of military telehandler products are FOB Origin. In addition, the ATLAS telehandler products must pass inspection by a government Quality Assurance Representative (“QAR”) at the point of production to insure adequate special paint requirements in order for us to recognize revenue. The sales terms of our Millennia Military Vehicle (“MMV”) brand of military telehandler products are FOB Destination. In addition, the MMV telehandler products must pass inspection by a government QAR at the point of production to insure adequate special paint requirements and must pass inspection by a government representative at the point of destination to insure against damage during transportation and verify delivery in order for us to recognize revenue.

Revenue from certain equipment lease contracts is accounted for as sales-type leases. The present value of all payments, net of executory costs (such as legal fees), is recorded as revenue and the related cost of the equipment is charged to cost of sales. The associated interest is recorded over the term of the lease using the interest method. In addition, net revenues include rental revenues earned on the lease of equipment held for rental. Rental revenues are recognized in the period earned over the lease term. Provisions for warranty are estimated and accrued at the time of sale. Actual warranty costs do not materially differ from estimates.

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We ship equipment on a limited basis to certain customers on consignment which under generally accepted accounting principles allows recognition of the revenues only upon final sale of the equipment by the consignee. At April 30, 2004, we had $4 million of inventory on consignment.

Long-Lived Assets

We review our long-lived assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to the future net cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds their fair value. Judgments made by us related to the expected useful lives of long-lived assets and our ability to realize any undiscounted cash flows in excess of the carrying amounts of such assets are affected by factors such as the ongoing maintenance and improvements of the assets, changes in the expected use of the assets, changes in economic conditions, changes in operating performance and anticipated future cash flows. Since judgment is involved in determining the fair value of long-lived assets, there is risk that the carrying value of our long-lived assets may require adjustment in future periods. If actual fair value is less than our estimates, long-lived assets may be overstated on the balance sheet and a charge would need to be taken against earnings.

Goodwill

Annually, we test the impairment of our goodwill in the fourth quarter of our fiscal year by assessing the fair value of our reporting units based upon a discounted cash flow methodology. The cash flows are based on management’s projection of future financial results, including revenues, costs, working capital changes and capital expenditures and are discounted at a rate corresponding to a “market” rate. Actual results will differ from those estimates.

In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 142, “Goodwill and Other Intangible Assets,” our reporting unit was determined as our Machinery operating segment. We use our Machinery segment as our reporting unit because no components of the operating segment meet the criteria established in SFAS No. 142 for use as a reporting unit in determination of goodwill impairment.

If the carrying amount of the reporting unit exceeded the estimated fair value determined through that discounted cash flow methodology, goodwill impairment may be present. We would measure the goodwill impairment loss based upon the fair value of the underlying assets and liabilities of the reporting unit, including any unrecognized intangible assets, and estimate the implied fair value of goodwill. An impairment loss would be recognized to the extent that a reporting unit’s recorded goodwill exceeded the implied fair value of goodwill.

Advertising and Promotion

Advertising has been incurred when the services have been rendered or provided.

Employee Retirement Plans

We have discretionary, defined contribution retirement plans covering our eligible U.S. employees. Our Board of Directors annually approves contributions to the plans. The contributions to the plans are based on a calendar year while our fiscal year ends July 31. Accordingly, we estimate our financial performance on a fiscal basis which could turn out significantly different on a calendar basis. We estimate contributions to these plans based upon our projected profitability and we accrue the contributions as a percent of payroll each pay period. We review the amount accrued on a quarterly basis. If our actual financial performance or the percent of payroll differs significantly from the projections, we may be required to adjust the accruals.

Sales Incentives

We recognize volume discounts and sales incentives at the time we recognize a sale based upon the contractual terms of our arrangement with the customer and, where applicable, our estimate of that customer’s annual sales volume. These programs are reflected in our Condensed Consolidated Statements of Income as a reduction of revenue. If the actual sales to the customer differ significantly from the projections, we may be required to adjust the estimates.

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Stock Based Incentive Plans

At our Annual Meeting of Shareholders on November 20, 2003, shareholders approved our Long Term Incentive Plan (the “Plan”), which replaced our Amended and Restated Stock Incentive Plan and our Directors’ Stock Option Plan (the “Prior Plans”). This allowed us to combine the Prior Plans into a single integrated plan that will provide greater flexibility for additional types of awards, including performance based cash awards. We account for the award of stock options pursuant to the Plan under the recognition and measurement principles of Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees,” and related Interpretations. Under this opinion, we do not recognize compensation expense arising from the grant of stock options because the exercise price of our stock options equals the market price of the underlying stock on the date of grant. The following table illustrates the effect on net income and earnings per share if we had applied the fair value recognition provisions of SFAS No. 123, “Accounting for Stock-Based Compensation,” for each of the periods ended April 30:

NOTE 2 – RECENT ACCOUNTING PRONOUNCEMENTS

In January 2003, the Financial Accounting Standards Board (“FASB’) issued FASB Interpretation No. 46 (“FIN 46”), “Consolidation of Variable Interest Entities.” This interpretation of Accounting Research Bulletin No. 51, “Consolidated Financial Statements,” addresses consolidation of variable interest entities. FIN 46 requires certain variable interest entities (“VIE’s”) to be consolidated by the primary beneficiary if the entity does not effectively disperse risks among the parties involved. The provisions are effective for the first annual or interim period beginning after December 15, 2003. We have determined that our only joint venture is deemed to be a business under the definition of FIN 46 and that in accordance with the interpretation, the joint venture need not be evaluated to determine if the entity is a VIE under the requirements of FIN 46. Additionally, we have concluded that we do not participate in any other structures that qualify as VIE’s as defined by FIN 46.

On December 8, 2003, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (the “Act”) was signed into law which introduced a prescription drug benefit under Medicare (Medicare Part D) as well as a federal subsidy to sponsors of retiree health care benefit plans that provide a benefit that is at least actuarially equivalent to Medicare Part D. In January 2004, the FASB issued FASB Staff Position (“FSP”) No. FAS 106-1, “Accounting and Disclosure Requirements Related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003.” As provided under FSP No. FAS 106-1, we have elected to defer accounting for the

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effects of the Act until authoritative guidance on the accounting for the federal subsidy is issued or until a significant event occurs that ordinarily would call for us to remeasure our plans’ assets and obligations. The guidance, when issued, could require us to change previously reported information. Additionally, the accrued benefit obligation and the net periodic postretirement benefit cost included in our condensed consolidated financial statements do not reflect the effects of the Act on our plan.

In December 2003, the FASB issued a revision to SFAS No. 132, “Employer’s Disclosures About Pensions and Other Postretirement Benefits,” which revises employers’ disclosures about pension plans and other postretirement benefit plans. The revised SFAS No. 132 requires disclosures in addition to those in the original SFAS No. 132 related to the assets, obligations, cash flows and net periodic benefit cost of defined pension plans and other defined benefit postretirement plans, including interim disclosures regarding components of net periodic benefit costs recognized during interim periods. At April 30, 2004, we have adopted the interim disclosure provisions of SFAS No. 132.

NOTE 3 – ACQUISITION

On August 1, 2003, we acquired the OmniQuip business unit (“OmniQuip”) of Textron Inc., which includes all operations relating to the Sky Trak® and Lull® brand commercial telehandler products and the All-Terrain Lifter, Army System and the Millennia Military Vehicle military telehandler products, for $105.4 million, which included transaction expenses of $5.4 million, with $90 million paid in cash at closing and $10 million paid in the form of an unsecured subordinated promissory note due on the second anniversary of the closing date. On February 4, 2004, we paid off this $10 million unsecured subordinated promissory note payable and post-closing purchase price adjustments in favor of Textron totaling $1.5 million. In addition, we will incur estimated expenditures totaling $47.8 million over a four-year period related to our integration plan. Through April 30, 2004, we have incurred expenditures of $20.1 million related to our OmniQuip integration plan. The integration plan expenditures are associated with personnel reductions, facility closings, plant start-up costs and facility operating expenses. We funded the cash portion of the purchase price and the transaction expenses with the remaining unallocated proceeds from the sale of our $125 million senior notes due 2008, and we anticipate funding integration expenses with cash generated from operations and borrowings under our credit facilities.

We made this acquisition because of its strategic fit and adherence to our growth strategy and acquisition criteria. This acquisition was an addition to our Machinery segment and has been accounted for as a purchase. Goodwill arising from the purchase price reflects a number of factors including the future earnings and cash flow potential of the acquired business and the complementary strategic fit and resulting synergies this acquisition brings to existing operations.

The following table summarizes our estimated fair values of the OmniQuip assets acquired and liabilities assumed on August 1, 2003:

Of the $34.2 million of acquired intangible assets, $23.6 million was assigned to registered trademarks that are not subject to amortization. The remaining $10.6 million of acquired intangible assets has a weighted-average useful life of approximately 8 years. The intangible assets that make up that amount include distributor and customer relations of $1.0 million (20-year weighted-average useful life), patents of $5.8 million (9-year weighted-average useful life),

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and contracts of $3.8 million (2-year weighted-average useful life). The entire amount of goodwill is expected to be deductible for tax purposes.

We continue to evaluate the initial purchase price allocation for the OmniQuip acquisition and will adjust the allocations as additional information relative to the estimated integration costs of the acquired businesses and the fair market values of the assets and liabilities of the businesses become known. Examples of factors and information that we use to refine the allocations include: tangible and intangible asset appraisals; cost data related to redundant facilities; employee/personnel data related to redundant functions; product line integration and rationalization information; and management capabilities. In addition, we will accrue the estimated cost of integration activities when such amounts are determined, but in no event beyond one year from the date of acquisition.

The operating results of OmniQuip are included in our consolidated results from operations beginning August 1, 2003.

In compliance with generally accepted accounting principles, the following unaudited pro forma financial information for the three and nine months ended April 30, 2003 reflects our consolidated results of operations as if the OmniQuip acquisition had taken place on August 1, 2002. The unaudited pro forma financial information is not necessarily indicative of the results of operations had the transaction been effected on the assumed date.

In connection with our acquisitions, we assess and formulate plans related to their future integration. This process begins during the due diligence process and is concluded within twelve months of the acquisition. We accrue estimates for certain costs, related primarily to personnel reductions and facility closures or restructurings, anticipated at the date of acquisition, in accordance with Emerging Issues Task Force Issue No. 95-3, “Recognition of Liabilities in Connection with a Purchase Business Combination.” Adjustments to these estimates are made as plans are finalized, but in no event beyond one year from the acquisition date. To the extent these accruals are not utilized for the intended purpose, the excess is recorded as a reduction of the purchase price, typically by reducing recorded goodwill balances. Costs incurred in excess of the recorded accruals are expensed as incurred.

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Accrued liabilities associated with these integration activities include the following (in thousands, except headcount):

NOTE 4 – GOODWILL

The following table presents the rollforward of goodwill for the period from July 31, 2003 to April 30, 2004:

There were no dispositions of businesses with related goodwill during the nine months ended April 30, 2004. On August 1, 2003, we acquired OmniQuip for $105.4 million, which resulted in the increase to goodwill. The acquired goodwill change in the period related to our Machinery segment.

NOTE 5 – INTANGIBLE ASSETS

Intangible assets consist of the following at April 30, 2004:

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NOTE 6 - INVENTORIES AND COST OF SALES

A precise inventory valuation under the LIFO (last-in, first-out) method can only be made at the end of each fiscal year; therefore, interim LIFO inventory valuation determinations, including the determination at April 30, 2004, must necessarily be based on our estimate of expected fiscal year-end inventory levels and costs. The cost of United States inventories is based primarily on the LIFO (last-in, first-out) method. All other inventories are based on the FIFO (first-in, first-out) method.

Inventories consist of the following:

The cost of United States inventories stated under the LIFO method was 57% and 51% at April 30, 2004 and July 31, 2003, respectively, of our total inventory.

NOTE 7 - FINANCE AND PLEDGED FINANCE RECEIVABLES

Finance receivables represent sales-type leases resulting from the sale of our products. Our sales-type leases may have a component of residual value which anticipates that a piece of equipment will have a minimum fair market value at a future point in time and the residual value accrues to us at the end of the lease. We use our experience and knowledge as an original equipment manufacturer and participate in end markets for our products along with third-party studies to provide us with values for our products in the used equipment market and to estimate residual values. We monitor these values for impairment and reflect any resulting adjustments in current earnings.

Our net investment in finance and pledged finance receivables was as follows at:

Of the total finance and pledged finance receivables balances at April 30, 2004 and July 31, 2003, $131.9 million and $160.4 million, respectively, are pledged finance receivables resulting from the monetization of finance receivables. In compliance with SFAS No. 140, “Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities,” these monetization transactions are accounted for as debt on our Condensed Consolidated Balance Sheets. The maximum loss exposure associated with these transactions was $23.8 million as of April 30, 2004. As of April 30, 2004, our provision for losses related to these transactions was $3.1 million.

The following table displays the contractual maturity of our finance and pledged finance receivables. It does not necessarily reflect the timing of future cash collections because of various factors including the possible refinancing or sale of finance receivables and repayments prior to maturity.

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For the twelve-month periods ended April 30:

Provisions for losses on finance and pledged finance receivables are charged to income in amounts sufficient to maintain the allowance at a level considered adequate to cover potential losses in the existing receivable portfolio.

NOTE 8 - CHANGES IN ACCOUNTING ESTIMATES

During the second quarter of fiscal 2003, we determined that we would not make a discretionary profit sharing contribution for calendar year 2002. This change resulted in an increase in net income of $1.3 million, or $.03 per diluted share, for the first nine months of fiscal 2003.

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NOTE 9 - BASIC AND DILUTED EARNINGS PER SHARE

This table presents our computation of basic and diluted earnings per share for each of the periods ended April 30:

During the quarter ended April 30, 2004, options to purchase 0.8 million shares of capital stock at a range of $14.75 to $21.94 per share were not included in the computation of diluted earnings per share because exercise prices for the options were more than the average market price of the capital stock.

NOTE 10 – SEGMENT INFORMATION

We have organized our business into three segments – Machinery, Equipment Services and Access Financial Solutions. The Machinery segment contains the design, manufacture and sale of new equipment. The Equipment Services segment contains after-sales service and support, including parts sales, equipment rentals, and used and remanufactured or reconditioned equipment sales. The Access Financial Solutions segment contains financing and leasing activities. We evaluate performance of the Machinery and Equipment Services segments and allocate resources based on operating profit before interest, miscellaneous income/expense and income taxes. We evaluate performance of the Access Financial Solutions segment and allocate resources based on its operating profit less interest expense. Intersegment sales and transfers are not significant. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies.

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Our business segment information consisted of the following for each of the periods ended April 30:

This table presents our business segment assets at:

We manufacture our products in the United States, Belgium and France and sell these products globally, but principally in North America, Europe, Australia and South America. No single foreign country is significant to the consolidated operations. Our revenues by geographic area consisted of the following for each of the periods ended April 30:

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NOTE 11 – EMPLOYEE RETIREMENT PLANS

Our components of pension expense were as follows for each of the periods ended April 30:

Our components of other postretirement benefits expense were as follows for each of the periods ended April 30:

NOTE 12 - COMPREHENSIVE INCOME

On an annual basis, comprehensive income is disclosed in the Statement of Shareholders’ Equity. This statement is not presented on a quarterly basis. The following table presents the components of comprehensive income for each of the periods ended April 30:

NOTE 13 – PRODUCT WARRANTY

This table presents our reconciliation of accrued product warranty during the period from July 31, 2003 to April 30, 2004:

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NOTE 14 – RESTRUCTURING COSTS

During the second quarter of fiscal 2003, we announced further actions related to our ongoing longer-term strategy to streamline operations and reduce fixed and variable costs. As part of our capacity rationalization plan for our Machinery segment that commenced in early 2001, the 130,000-square foot Sunnyside facility in Bedford, Pennsylvania, which produced selected scissor lift models, was idled and production integrated into our Shippensburg, Pennsylvania facility. Additionally, reductions in selling, administrative and product development costs resulted from improvements in our global organizations and from process consolidations. We have improved our European sales and service operations model by eliminating redundant operations and reducing headcount and focused on enhancing the business for increased profitability and growth by ongoing manufacturing process improvements. When these changes and consolidations are fully implemented, we expect to generate approximately $20 million in annualized savings at a cost of $9.4 million, representing a payback of approximately six months.

The announced plan contemplates that we will reduce a total of 189 people globally and transfer 99 production jobs from the Sunnyside facility to the Shippensburg facility. As a result, pursuant to the plan we anticipate incurring a pre-tax charge of $5.9 million, consisting of $3.5 million in restructuring costs associated with personnel reductions and employee relocation and lease and contract terminations and $2.4 million in restructuring-related charges which include costs related to relocating certain plant assets and start-up costs with the move of the Sunnyside operations to the Shippensburg facility. In addition, we will spend approximately $3.5 million on capital requirements. Almost all of these expenses will be cash charges.

As noted above, the continuing streamlining of our operations will result in $3.5 million in personnel reductions and relocation and lease and contract terminations and will be recorded as a restructuring cost. In accordance with accounting requirements, through the third quarter of fiscal 2004, we recognized $2.8 million of the pre-tax restructuring charge, consisting of an accrual for termination benefit costs and employee relocation costs. In addition, we incurred $1.2 million of restructuring-related costs, which include costs related to relocating certain plant assets and start-up costs, which was recorded as a cost of sales. Also, through the third quarter of fiscal 2004, we spent approximately $3.5 million on capital requirements. We anticipate recording the remaining restructuring and restructuring-related costs in our fourth quarter of fiscal 2004.

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The following table presents a rollforward of our activity in the restructuring accrual and our charges related to relocating certain plant assets and start-up costs associated with the move of the Bedford operations to the Shippensburg facility and costs related to our process consolidations:

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(1)

The restructuring-related charges shown in the table have not been accrued, but are charged as incurred. The purpose of this disclosure is to show the original amount estimated for these costs, the quarterly amount of the restructuring-related charges that we have expensed and the costs we anticipate to incur in future periods.

During the third quarter of fiscal 2002, we announced the closure of our manufacturing facility in Orrville, Ohio as part of our capacity rationalization plan for our Machinery segment. Operations at that facility have been integrated into our McConnellsburg, Pennsylvania facility. As a result, through April 30, 2004, we have incurred a pre-tax charge of $6.9 million, consisting of $1.2 million for termination benefits and lease termination costs, a $4.9 million

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asset write-down and $0.9 million in restructuring-related charges which include costs related to relocating certain plant assets and start-up costs associated with the move of the Orrville operations to the McConnellsburg facility. We have realized $5.6 million in annual cost savings associated with the closing of our Orrville facility.

The following table presents a rollforward of our activity in the restructuring accrual and our restructuring-related charges, which include costs related to relocating certain plant assets and start-up costs associated with the move of the Orrville operations to McConnellsburg:

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(1)

The restructuring-related charges shown in the table have not been accrued, but are charged as incurred. The purpose of this disclosure is to show the original amount estimated for these costs, the annual amount of the restructuring-related charges that we have expensed and the costs we anticipate to incur in future periods.

At April 30, 2004, we included $6.2 million of assets held for sale on the Condensed Consolidated Balance Sheets in other current assets and ceased depreciating these assets during the third quarter of fiscal 2002 and the fourth quarter of fiscal 2001.

Our accrued liabilities associated with the acquisition of OmniQuip are discussed in Note 3 of the Notes to Condensed Consolidated Financial Statements of this report.

NOTE 15 – COMMITMENTS AND CONTINGENCIES

In the ordinary course of our business, we are a party to personal injury and property damage litigation arising out of incidents involving the use of our products. Our insurance program for fiscal 2004 is comprised of a self-insured retention of $3 million per occurrence for domestic claims, insurance coverage of $2 million for international claims and catastrophic coverage for domestic and international claims of $100 million in excess of the retention and international primary coverage. We contract with an independent firm to provide claims handling and adjustment services. Our estimates with respect to claims are based on internal evaluations of the merits of individual claims and the reserves assigned by our independent insurance claims adjustment firm. We frequently review the methods of making such estimates and establishing the resulting accrued liability, and any resulting adjustments are reflected in current earnings. Claims are paid over varying periods, which generally do not exceed five years. Accrued liabilities for future claims are not discounted.

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With respect to all product liability claims of which we are aware, we established accrued liabilities of $22.1 million and $19.0 million at April 30, 2004 and July 31, 2003, respectively. These amounts are included in accrued expenses and provisions for contingencies on our Condensed Consolidated Balance Sheets. While our ultimate liability may exceed or be less than the amounts accrued, we believe that it is unlikely that we would experience losses that are materially in excess of such reserve amounts. The provisions for self-insured losses are included within cost of sales in our Condensed Consolidated Statements of Income. As of April 30, 2004 and July 31, 2003, there were no insurance recoverables or offset implications and there were no claims by us being contested by insurers.

At April 30, 2004, we were a party to multiple agreements whereby we guarantee $104.2 million in indebtedness of others, including the $23.8 million maximum loss exposure associated with our pledged finance receivables. As of April 30, 2004, one customer owed approximately 24% of the guaranteed indebtedness. Under the terms of these and various related agreements and upon the occurrence of certain events, we generally have the ability, among other things, to take possession of the underlying collateral and/or make demand for reimbursement from other parties for any payments made by us under these agreements. At April 30, 2004, we had $10.5 million reserved related to these agreements, including a provision for losses of $3.1 million related to our pledged finance receivables. If the financial condition of our customers were to deteriorate resulting in an impairment of their ability to make payments, additional allowances may be required. While we believe it is unlikely that we would experience losses under these agreements that are materially in excess of the amounts reserved, we can provide no assurance that the financial condition of the third parties will not deteriorate resulting in the customers’ inability to meet their obligations and, in the event that occurs, we can not guarantee that the collateral underlying the agreements will not result in losses materially in excess of those reserved.

We have received notices of proposed adjustments from the Pennsylvania Department of Revenue (“PA”) in connection with settlements and audits of the tax years 1998 through 2001. The principal adjustments proposed by PA consist of the disallowance of a royalty deduction taken in our income tax returns and the denial of the manufacturing exemption taken in our capital stock tax returns. We believe that the state has acted contrary to applicable law, and we are vigorously disputing its position. Should PA prevail in its disallowance of the royalty deduction and denial of the manufacturing exemption, it would result in a cash outflow by us of approximately $7 million. Although unlikely, we believe that any such cash outflow would not occur until some time after 2004.

There can be no assurance that unanticipated events will not require us to increase the amount we have accrued for any matter or accrue for a matter that has not been previously accrued because it was not considered probable.

NOTE 16 – BANK CREDIT LINES AND LONG-TERM DEBT

Our long-term debt was as follows at:

The aggregate amounts of long-term debt outstanding at April 30, 2004 which will become due in 2005 through 2009 are: $1 million, $1.1 million, $15.1 million, $1.1 million and $123.9 million, respectively.

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At April 30, 2004, the fair values of our $175 million 8 3/8% senior subordinated notes due 2012 and our $125 million 8 1/4% senior unsecured notes due 2008 were $183.8 million and $133.8 million, respectively, based on quoted market values. At July 31, 2003, the fair values of our $175 million 8 3/8% senior subordinated notes due 2012 and our $125 million 8 1/4% senior unsecured notes due 2008 were $158.5 million and $126.3 million, respectively, based on quoted market values. The fair value of our remaining long-term debt at April 30, 2004 and at July 31, 2003 is estimated to approximate the carrying amount reported in the Condensed Consolidated Balance Sheets based on current interest rates for similar types of borrowings.

NOTE 17 – LIMITED RECOURSE DEBT FROM FINANCE RECEIVABLES MONETIZATIONS

As a result of the sale of finance receivables through limited recourse monetization transactions, we have $135.5 million of limited recourse debt outstanding as of April 30, 2004. The aggregate amounts of limited recourse debt outstanding at April 30, 2004 which will become due in 2005 through 2009 are: $37.1 million, $37 million, $30.4 million, $18.9 million and $6.5 million, respectively.

NOTE 18 – PROPERTY, PLANT AND EQUIPMENT

Our property, plant and equipment consists of the following at:

At April 30, 2004, assets under capital leases totaled approximately $3.5 million. Accumulated amortization of assets held under capital leases totaled approximately $0.4 million at April 30, 2004.

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NOTE 19 – CONDENSED CONSOLIDATING FINANCIAL INFORMATION OF GUARANTOR SUBSIDIARIES

Certain of our indebtedness is guaranteed by our significant subsidiaries (the “guarantor subsidiaries”), but is not guaranteed by our other subsidiaries (the “non-guarantor subsidiaries”). The guarantor subsidiaries are all wholly owned, and the guarantees are made on a joint and several basis and are full and unconditional subject to a standard limitation which provides that the maximum amount guaranteed by each guarantor will not exceed the maximum amount guaranteed without making the guarantee void under fraudulent conveyance laws. Separate financial statements of the guarantor subsidiaries have not been presented because management believes it would not be material to investors. The principal elimination entries eliminate investment in subsidiaries, intercompany balances and transactions and certain other eliminations to properly eliminate significant transactions in accordance with our accounting policy for the principles of consolidated and statement presentation. The condensed consolidating financial information of the Company and its subsidiaries are as follows:

CONDENSED CONSOLIDATED BALANCE SHEET
As of April 30, 2004

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CONDENSED CONSOLIDATED BALANCE SHEET
As of July 31, 2003