-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RJphPfiMUPtSTi+DycLqR5ILvEgRqFJJgow2hIK3O68lrOAtWMVYz+c6wImQLH8r bRs4AaANsNiM0CTQTsGKQw== 0000950117-04-001909.txt : 20040517 0000950117-04-001909.hdr.sgml : 20040517 20040517140953 ACCESSION NUMBER: 0000950117-04-001909 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20040331 FILED AS OF DATE: 20040517 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EMPIRE RESOURCES INC /NEW/ CENTRAL INDEX KEY: 0001019272 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 223136782 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-12127 FILM NUMBER: 04811418 BUSINESS ADDRESS: STREET 1: ONE PARKER PLAZA CITY: FORT LEE STATE: NJ ZIP: 07024 BUSINESS PHONE: 201-944-22 MAIL ADDRESS: STREET 1: ONE PARKER PLAZA CITY: FORT LEE STATE: NJ ZIP: 07024 FORMER COMPANY: FORMER CONFORMED NAME: INTEGRATED TECHNOLOGY USA INC DATE OF NAME CHANGE: 19960720 10-Q 1 a37712.txt EMPIRE RESOURCES, INC. U.S. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) [x] Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended March 31, 2004 [ ] Transition report under Section 13 or 15(d) of the Exchange Act For the transition period from to ---- ---- Commission file number 001-12127 EMPIRE RESOURCES, INC. (Exact Name of Registrant as Specified in Its Charter) Delaware 22-3136782 (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) One Parker Plaza Fort Lee, NJ 07024 (Address of Principal Executive Offices) 201 944-2200 (Registrant's Telephone Number, Including Area Code) Check whether the Registrant: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 [ ] No [X] APPLICABLE ONLY TO CORPORATE ISSUERS State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 9,544,251 shares of common stock outstanding as of May 10, 2004. 1 EMPIRE RESOURCES, INC. FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2004 INDEX PART I FINANCIAL INFORMATION Item 1 Financial Statements Page Condensed Consolidated Balance Sheets as of March 31, 2004 (unaudited) and December 31, 2003..........................................................4 Condensed Consolidated Statements of Income for the Three Months Ended March 31, 2004 and 2003 (unaudited)......................................5 Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2004 and 2003 (unaudited)......................................6 Notes to Condensed Consolidated Financial Statements (unaudited)...............7 Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations......................................................9 Item 3 Quantitative and Qualitative Disclosure of Market Risk........................12 Item 4 Controls and Procedures.......................................................13 PART II OTHER INFORMATION.............................................................13 Item 1 Legal Proceedings.............................................................13 Item 2 Changes in Securities, Use of Proceeds and Issuer Repurchases of Equity Securities.............................................................13 Item 3 Defaults Upon Senior Securities...............................................14 Item 4 Submission of Matters to a Vote of Security Holders...........................14 Item 5 Other Information.............................................................14 Item 6 Exhibits and Reports on Form 8-K..............................................14 Signatures....................................................................15
2 Introduction The condensed consolidated interim financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission with respect to Form 10-Q. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to such rules and regulations. In the opinion of management, such financial statements reflect all adjustments necessary for a fair presentation of the results for the interim periods presented and to make such financial statements not misleading. The results of operations of the Company for the three months ended March 31, 2004 are not necessarily indicative of the results to be expected for the full year. It is suggested that these interim financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company's Form 10-K for the year ended December 31, 2003. 3 EMPIRE RESOURCES, INC. Condensed Consolidated Balance Sheets In Thousands, except shares and per share amounts
March 31, December 31, -------------------------- 2004 2003 -------------------------- (Unaudited) ASSETS Current assets: Cash $ 1,479 $ 1,477 Trade accounts receivable (net) 31,270 25,723 Inventories 35,397 42,048 Other current assets 2,055 5,100 ------- ------- Total current assets 70,201 74,348 Furniture and equipment (less accumulated depreciation of $411 and $396) 174 156 ------- ------ $70,375 $74,504 ======= ====== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Notes payable - banks $34,600 $34,400 Trade accounts payable 16,200 16,895 Accrued expenses 3,299 7,328 Dividend payable 382 762 ------- ------- Total current liabilities 54,481 59,385 ------- ------- Commitments and contingencies Stockholders' equity: Preferred stock $.01 par value, 5,000,000 shares authorized; none issued Common stock $.01 par value, 20,000,000 shares authorized; 117 117 11,749,651 shares issued Additional paid-in capital 10,801 10,803 Retained earnings 7,601 6,848 Accumulated other comprehensive income-- 14 14 cumulative translation adjustment Treasury stock (2,205,400 and 2,221,400 shares) (2,639) (2,663) ------- ------- Total stockholders' equity 15,894 15,119 ------- ------- $70,375 $74,504 ======= =======
See notes to condensed consolidated financial statements 4 EMPIRE RESOURCES, INC. Condensed Consolidated Statements of Income (Unaudited) In thousands, except per share amounts
Three Months Ended March 31, ---------------------------- 2004 2003 ---------------------------- Net sales $54,185 $44,937 Cost of goods sold 50,349 41,741 ------- ------- Gross profit 3,836 3,196 Selling, general and administrative expenses 1,691 1,522 ------- ------- Operating income 2,145 1,674 Interest expense 299 226 ------- ------- Income before income taxes 1,846 1,448 Income taxes 711 578 ------- ------- Net income $ 1,135 $ 870 ======= ======= Weighted average shares outstanding: Basic 9,530 9,435 ======= ======= Diluted 9,885 9,541 ======= ======= Earnings per share: Basic $ 0.12 $ 0.09 ======= ======= Diluted $ 0.11 $ 0.09 ======= =======
See notes to condensed consolidated financial statements 5 EMPIRE RESOURCES, INC. Condensed Consolidated Statements of Cash Flows (Unaudited) In thousands
Three Months Ended March 31, -------------------------- 2004 2003 -------------------------- Cash flows from operating activities: Net income $ 1,135 $ 870 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation and amortization 15 17 Translation adjustment 0 1 Changes in: Trade accounts receivable (5,547) (5,468) Inventories 6,651 (1,103) Other current assets 3,045 1,073 Trade accounts payable (695) 5,758 Accrued expenses (4,029) (787) Net cash provided by operating activities 575 361 ------- ------- Cash flows used in investing activities: Additions to fixed assets (33) (5) ------- ------- Cash flows from financing activities: Net proceeds from notes payable - banks 200 100 Purchase of treasury stock 0 (14) Proceeds - option exercised 22 Dividends Paid (762) ------- ------- Net cash (used in) provided by financing activities (540) 86 ------- ------- Net increase in cash 2 442 Cash at beginning of period 1,477 1,072 ------- ------- Cash at end of period $ 1,479 $ 1,514 ======= ======= Supplemental disclosures of cash flow information: Cash paid during the period for: Interest $ 352 $ 277 Income taxes $ 140 $ 205 Non Cash Financing Activities: Dividend Declared but not yet paid $ 382 $ 0
See notes to condensed consolidated financial statements 6 Notes to Condensed Consolidated Financial Statements (Unaudited) - -------------------------------------------------------------------------------- 1. The Company Empire Resources, Inc. (the "Company") is engaged principally in the purchase, sale and distribution of value added semi-finished aluminum products to a diverse customer base located throughout North America and Australia. The Company sells its products through its own marketing and sales personnel and through its independent sales agents located in the U.S. who receive commissions on sales. The Company purchases from several suppliers located throughout the world; however, one supplier, Hulett Aluminium Ltd. ("Hulett") presently accounts for more than 62% of the Company's purchases. (See Note 3) The condensed consolidated financial statements include the accounts of Empire Resources, Inc. and its wholly-owned subsidiary, Empire Resources Pacific Ltd., which acts as a sales agent for the Company in Australia. All significant intercompany transactions and accounts have been eliminated in consolidation. 2. Use of Estimates The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. The principle estimate made relates to the allowance for doubtful accounts. Actual results could differ from these estimates. 3. Concentrations One major customer accounted for approximately 16% of the Company's consolidated net sales for the period ended March 31, 2004 and 10% for the period ended March 31, 2003. The Company's purchase of nonferrous metal is from a limited number of suppliers located throughout the world. One supplier, Hulett Aluminium Ltd., accounted for 62% of total purchases during the period ended March 31, 2004 and three other suppliers accounted for 27% of total purchases. The Company's loss of any of its three largest suppliers or a material default by any such supplier in its obligations to the Company would have at least a short-term material adverse effect on the Company's business. On October 16, 2003, Alcoa, Inc. filed a petition with the Department of Commerce ("DOC") and the International Trade Commission ("ITC") for the imposition of anti-dumping duties on imports of certain aluminum rolled plate from Hulett, the Company's principal supplier. The petition relates to one specific product produced by Hulett - Series 6000 Aluminum Rolled Plate. Hulett produces numerous other products that the Company presently imports. On May 14, 2004 the DOC issued its preliminary determination of a dumping margin of 4.33%. Hulett stated in a recent press release that this margin will not affect Hulett's ability to continue to supply the product to the Company for distribution in the U.S. market. The Company has been assured by Hulett that it will continue to ship the product, pending the final results of the DOC investigation and a final International Trade Commission ruling. In the event that Hulett, in the See notes to condensed consolidated financial statements 7 future, ceases supply of the product and if the Company is unable to secure an alternative source of supply for the product at comparable volumes and prices, the Company's future results of operations could be adversely affected. 4. Stock Options The Company accounts for stock-based employee compensation under the recognitions and measurement principles of Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued to Employees", and related interpretations. No stock-based employee compensation cost is reflected in net income as all options granted under the Plan had an exercise price equal to the market value of the underlying common stock on the date of grant. The Company has adopted the disclosure-only provisions of Statement of Financial Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based Compensation." The following table illustrates the effect on net income and earnings per share if the fair value based method had been applied to all awards.
Three Months Ended March 31, --------------------------------- 2004 2003 -------------- ------------- Reported net income $ 1,135 $ 870 Stock-based employee compensation determined under the fair value based method 0 0 -------------- ------------- Pro forma net income $ 1,135 $ 870 ============== ============= Earnings per share: As Reported: Basic $0.12 $0.09 Diluted $0.11 $0.09 Pro forma: Basic $0.12 $0.09 Diluted $0.11 $0.09
5. Inventories Inventories, which consist of purchased semi-finished aluminum products, are stated at the lower of cost or market. Cost is determined by the specific-identification method. Inventory has generally been purchased for specific customer orders. 6. Notes Payable--Banks The Company operates under a $50,000,000 committed credit facility with three commercial banks. This facility which was renewed on June 19, 2003, expires on June 30, 2006. Borrowings by the Company under this line of credit are collateralized by security interests in substantially all its assets. Under the agreement, Empire is required to maintain working capital and net worth ratios as defined by the loan agreement. As of March 31, 2004 and 2003 See notes to condensed consolidated financial statements 8 respectively, the credit utilized under this facility amounted to $43.6 million and $42.9 million (including approximately $9 million and $8.5 million of outstanding letters of credit). Interest on borrowings is either (i) the federal funds rate, (ii) the prime rate of JP Morgan Chase or (iii) LIBOR, plus the applicable margins defined in the loan agreement. 7. Earnings Per Share
Three months ended March 31, --------------------------------- 2004 2003 -------------- ------------- Weighted average shares outstanding-basic 9,530 9,435 Dilutive effect of stock options 355 106 ----- ----- Weighted average shares outstanding-diluted 9,885 9,541 ===== =====
Basic earnings per share are based upon the Company's weighted average number of common shares outstanding during each period. Diluted earnings per share are based upon the weighted average number of common shares outstanding during each period, assuming the issuance of common shares for all dilutive potential common shares outstanding during the period. 8. Dividends On March 23, 2004, the Board of Directors of the Company declared a cash dividend of $0.04 per share to stockholders of record at the close of business on April 5, 2004. The dividend totaling $382,000 is included in accrued expenses at March 31, 2004 and was paid on April 19, 2004. 9. Commitments and Contingencies Empire has contingent liabilities in the form of letters of credit to certain of its suppliers, which at March 31, 2004 amounted to approximately $9.0 million. The Company hedges metal pricing and foreign currency as it deems appropriate for a portion of its purchase and sales contracts. There is a risk of a counterparty default in fulfilling the hedge contract. Should there be a counterparty default, the Company could be exposed to losses on the original hedged contract. Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Forward Looking Statements The discussions set forth below and elsewhere herein contain certain statements that may be considered forward-looking statements under the Private Securities Litigation Reform Act of 1995. The Company may make written or oral forward-looking statements in other documents we file with the SEC, in our annual reports to stockholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. See notes to condensed consolidated financial statements 9 You can identify forward-looking statements by the use of the words "believe," "expect," "anticipate," "intend," estimate," "assume," "will," "should," and other expressions which predict or indicate future events or trends and which do not relate to historical matters. You should not rely on forward-looking statements, because they involve known and unknown risks, uncertainties and other factors, some of which are beyond the control of the Company. These risks, uncertainties and other factors may cause the actual results, performance or achievements of the Company to be materially different from the anticipated future results, performance or achievements expressed or implied by the forward-looking statements. Some of the factors that might cause these differences include the following: changes in general, national or regional economic conditions; an act of war or terrorism that disrupts international shipping; changes in laws, regulations and tariffs, the imposition of anti-dumping duties on the products imported, including those produced by Hulett Aluminium Ltd.; changes in the size and nature of the Company's competition; changes in interest rates, foreign currencies or spot prices of aluminum; loss of one or more foreign suppliers or key executives; increased credit risk from customers; failure of the Company to grow internally or by acquisition and to integrate acquired businesses; failure to improve operating margins and efficiencies; and changes in the assumptions used in making such forward-looking statements. You should carefully review all of these factors, and you should be aware that there may be other factors that could cause these differences, including, among others, the factors listed under "Risk Factors," beginning on page 14 of our Annual Report on Form 10-K for the year ended December 31, 2003. Readers should carefully review the factors described under "Risk Factors" and should not place undue reliance on our forward-looking statements. These forward-looking statements were based on information, plans and estimates at the date of this report, and we do not promise to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes. General Empire is a distributor of value added, semi-finished aluminum products. Consequently, Empire's sales volume has been, and will continue to be, a function of its ongoing ability to secure quality aluminum products from its suppliers. While the Company maintains long-term supply relationships with several foreign mills, one such supplier, Hulett Aluminium Ltd., ("Hulett") presently accounts for more than 62% of the Company's purchases. The Company's ability to succeed is driven in part by continued customer satisfaction, supplier and customer loyalty and the ability to manage the competitive economic environment through the expansion and upgrading of its service to its suppliers and customers. This includes the ability to ship material on a just in time basis from both private and public warehouses, and the establishment of a proprietary on-line service modules for customers to track their shipments. This bolstered the Company's commitment to service and customer satisfaction. The Company has also used its excellent customer relationships to leverage sales per employee. Because the Company has always engaged in a strategy of developing long term relationships, it has been able to build sales volume without a similar increase in SG&A. The stable customer and supplier base has enabled the Company to increase its purchases from its suppliers and to sell the majority of these quantities to its existing customer base. While this does expose the Company to concentration risks, it has provided the foundation of the Company's growth and performance. See notes to condensed consolidated financial statements 10 Results of Operations (in thousands) Net sales increased $9,248, or 21%, during the first quarter of 2004 from $44,937 in the first quarter of 2003 to $54,185 in the first quarter of 2004, principally due to expanded shipments from the Company's existing supplier base and an increase during the first quarter of approximately 6% in U.S. aluminum metal pricing. Gross profit increased $640 or 20%, from $3,196 in the first quarter of 2003 to $3,836 in the first quarter of 2004. During this period gross profit as a percentage of sales remained stable. The Company experienced approximately an 11% increase in selling, general and administrative costs. The majority of this increase was attributable to legal expenses related to the Department of Commerce anti-dumping case against one of the Company's principal suppliers. The Company's ability to grow sales without an equivalent percentage increase in selling, general and administrative costs led to an increase in net income of 30% from $870 in March 2003 to $1,135 in March 2004. The Company's ability to increase its supply has been and will continue to be the main factor for its increased revenues. The Company successfully placed increased volumes primarily within its existing customer base which in turn led to increased customer concentration. The Company's top ten customers represented 48% of sales in the first quarter of 2004 as compared to 36% during the first quarter of 2003. Liquidity and Capital Resources (in thousands, except per share data) Empire currently operates under a $50,000 revolving line of credit, including a commitment to issue letters of credit, with three commercial banks. The Company's borrowings under this line of credit are collateralized by security interests in substantially all of Empire's assets. Empire is required to maintain working capital and net worth ratios under this credit agreement. This facility will expire on June 30, 2006. On March 23, 2004 Empire Resources, Inc. announced that its Board of Directors declared a cash dividend of $0.04 per share. The dividend totaling $382 was payable on April 19, 2004 to shareholders of record at the close of business on April 5, 2004. The Board of Directors will review its dividend policy on a quarterly basis and a determination by the Board of Directors will be made subject to the profitability and free cash flow and the other requirements of the business. Management believes that cash from operations, together with funds available under its credit facility, will be sufficient to fund the cash requirements relating to the Company's existing operations for the next twelve months. Empire may require additional debt or equity financing in connection with the future expansion of its operations. Application of Critical Accounting Policies The Company's condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. Certain accounting policies have a significant impact on amounts reported in the financial See notes to condensed consolidated financial statements 11 statements. A summary of those significant accounting policies can be found in Note B to the Company's financial statements included in the Company's 2003 Annual Report on Form 10-K. The Company has not adopted any significant new accounting policies during the three months ended March 31, 2004. Among the significant judgments made by management in the preparation of the Company's financial statements are the determination of the allowance for doubtful accounts and accruals for inventory claims. These adjustments are made each quarter in the ordinary course of accounting. As of March 31, 2004 the Company had $31.5 million in trade receivables. Additionally, the Company had recorded an allowance for doubtful accounts of $191. The allowance for doubtful accounts was not changed during the quarter. The Company reports accounts receivable, net of an allowance for doubtful accounts, to represent its estimate of the amount that ultimately will be realized in cash. The Company reviews the adequacy of its allowance for doubtful accounts on an ongoing basis, using historical collection trends, aging of receivables, as well as review of specific accounts, and makes adjustments in the allowance as it believes necessary. The Company maintains a credit insurance policy on the majority of its customers. This policy generally has a co-insurance provision and specific limits on each customer's receivables. The co-pay may be increased in selected instances and the Company sometimes elects to exceed these specific credit limits. Changes in economic conditions could have an impact on the collection of existing receivable balances or future allowance considerations. Generally, the Company's exposure on claims for defective material is small as the Company refers all claims on defects back to the mill supplying the material. In the event that the Company does not believe the mill will honor a claim, the Company will record an allowance for inventory adjustments. Commitments and Contingencies Empire has contingent liabilities in the form of letters of credit totaling $9.0 million to certain of its suppliers. There have been no material changes to the Company's commitments and contingencies from that disclosed in our Annual Report on Form 10-K for the year ended December 31, 2003. The Company hedges metal pricing and foreign currency as it deems appropriate for a portion of its purchase and sales contracts. There is a risk of a counterparty default in fulfilling the hedge contract. Should there be a counterparty default, the Company could be exposed to losses on the original hedged contract. Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE OF MARKET RISK The Company uses financial instruments designated as fair value hedges to manage its exposure to commodity price risk and foreign currency exchange risk inherent in its operations. It is the Company's policy to hedge such risks, to the extent practicable. The Company enters into high-grade aluminum futures contracts to limit its gross margin exposure by hedging the metals content element of firmly committed purchase and sales commitments. The Company also enters into foreign exchange forward contracts to hedge its exposure related to See notes to condensed consolidated financial statements 12 commitments to purchase or sell non-ferrous metals denominated in international currencies. The Company records "mark-to-market" adjustments on these futures and forward positions, and on the underlying firm purchase and sales commitments which they hedge, and reflects the net gains and losses currently in earnings. There have been no material changes to the Company's market risk from that disclosed in our Annual Report on Form 10-K for the year ended December 31, 2003. ITEM 4. CONTROLS AND PROCEDURES As required by Rule 13a-15 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), the Company's management conducted an evaluation with the participation of the Company's Chief Executive Officer and Chief Financial Officer, regarding the effectiveness of the Company's disclosure controls and procedures, as of the end of the last fiscal quarter. In designing and evaluating the Company's disclosure controls and procedures, the Company and its management recognize that any controls and procedures, no matter how well designed and operated, can provide only a reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating and implementing possible controls and procedures. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that they believe the Company's disclosure controls and procedures are reasonably effective to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. We intend to continue to review and document our disclosure controls and procedures, including our internal controls and procedures for financial reporting, and we may from time to time make changes to the disclosure controls and procedures to enhance their effectiveness and to ensure that our systems evolve with our business. There was no change in our internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. PART II OTHER INFORMATION Item 1. Legal Proceedings. The Company is party from time to time to litigation incidental to its business. The Company does not presently believe that any such litigation would have a material adverse effect on its results of operation or financial condition. Item 2. Changes in Securities, Use of Proceeds and Issuer Repurchases of Equity Securities. None. See notes to condensed consolidated financial statements 13 Item 3. Defaults upon Senior Securities. None. Item 4. Submission of Matters to a Vote of Security Holders. None. Item 5. Other Information. On March 23, 2004, the Company issued a press release to announce 2003 operating results and a dividend for the first quarter of 2004 for stockholders of record on April 5, 2004. The dividend was paid on April 19, 2004. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits The following are included as exhibits to this report: Exhibit No. Description 31.1 Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934* 31.2 Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934* 32.1 Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002* - ------------------------- * Filed herewith (b) Reports on Form 8-K The Company filed a current report on Form 8-K dated March 24, 2004 disclosing the Company's March 23rd press release related to its announcement of year end 2003 results, and its dividend for the first quarter of 2004. See notes to condensed consolidated financial statements 14 SIGNATURES In accordance with the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned hereunto duly authorized. EMPIRE RESOURCES, INC. By: /s/ Sandra Kahn ----------------------------- Sandra Kahn Chief Financial Officer (signing both on behalf of the registrant and in her capacity as Principal Financial and Principal Accounting Officer) Dated: May 17, 2004 See notes to condensed consolidated financial statements 15 EX-31 2 ex31-1.txt EXHIBIT 31.1 Exhibit 31.1 CERTIFICATION PURSUANT TO SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002 I, Nathan Kahn, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Empire Resources, Inc.; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: May 17, 2004 By: /s/ Nathan Kahn ----------------------------- Nathan Kahn Chief Executive Officer EX-31 3 ex31-2.txt EXHIBIT 31.2 Exhibit 31.2 CERTIFICATION PURSUANT TO SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002 I, Sandra Kahn, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Empire Resources, Inc.; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have: i. designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; ii. evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and iii. disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): i. all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and ii. any fraud whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: May 17, 2004 By: /s/ Sandra Kahn ----------------------------- Sandra Kahn Chief Financial Officer EX-32 4 ex32-1.txt EXHIBIT 32.1 Exhibit 32 CERTIFICATIONS The undersigned officer of Empire Resources, Inc. (the "Company") hereby certifies that the Company's quarterly report on Form 10-Q for the period ended March 31, 2003 (the "Report"), as filed with the Securities and Exchange Commission on the date hereof, fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. This certification is provided solely pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and shall not be deemed to be a part of the Report or "filed" for any purpose whatsoever. Date: May 17, 2004 By: /s/ Nathan Kahn --------------------- Nathan Kahn, Chief Executive Officer and President The undersigned officer of Empire Resources, Inc. (the "Company") hereby certifies that the Company's quarterly report on Form 10-Q for the period ended March 31, 2004 (the "Report"), as filed with the Securities and Exchange Commission on the date hereof, fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. This certification is provided solely pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and shall not be deemed to be a part of the Report or "filed" for any purpose whatsoever. Date: May 17, 2004 By: /s/ Sandra Kahn ---------------------- Sandra Kahn, Chief Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----