-----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, EDZG58xbDnEWiaMAx4nOT0sE3cIQ3fVLQ4D874uhP73fq2Uf5vOH0zTyN/AMGZeC Wmv2+U8Xmyg+VGE2AIxRcg== 0000949459-96-000156.txt : 19960923 0000949459-96-000156.hdr.sgml : 19960923 ACCESSION NUMBER: 0000949459-96-000156 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19960731 FILED AS OF DATE: 19960920 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: AEROSONIC CORP /DE/ CENTRAL INDEX KEY: 0000109471 STANDARD INDUSTRIAL CLASSIFICATION: SEARCH, DETECTION, NAVIGATION, GUIDANCE, AERONAUTICAL SYS [3812] IRS NUMBER: 741668471 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-11750 FILM NUMBER: 96632393 BUSINESS ADDRESS: STREET 1: 1212 N HERCULES AVE CITY: CLEARWATER STATE: FL ZIP: 34625 BUSINESS PHONE: 8134613000 10-Q 1 QUARTERLY REPORT FOR PERIOD ENDED 07/31/96 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington D.C. 20549 QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR QUARTER ENDED July 31, 1996 COMMISSION FILE NO. 0-04988 ----------------------- ----------- AEROSONIC CORPORATION - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) DELAWARE 74-1668471 - ------------------------------------- --------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1212 No. Hercules Avenue, Clearwater, Florida 34625 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (813) 461-3000 - -------------------------------------------------------------------------------- (Registrant's telephone number, including Area Code) Non applicable - -------------------------------------------------------------------------------- (Former name, former address and former fiscal year, if changed since lastreport) Indicate by check mark whether 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 ----- ----- Securities registered pursuant to Section 12 (g) of the Act. Common Stock ($.40 par value) ----------------------------- (Title of Class) INDEX AEROSONIC CORPORATION Page No. -------- PART 1. FINANCIAL INFORMATION - ------- --------------------- Item 1. Financial Statements (unaudited) Condensed Balance Sheets - July 31, 1996 and January 31, 1996 2 Condensed Statements of Operations - Three and six months ended July 31, 1996 and 1995 3 Condensed Statements of Cash Flows - Six months ended July 31, 1996 and 1995 4 Notes to Condensed Financial Statements - July 31, 1996 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 6 - 7 - 8 SIGNATURES 9 - ---------- PART II. OTHER INFORMATION - -------- ----------------- Item 6. Exhibits and Reports on Form 8-K Exhibit I. - Computations of Earnings Per Share 10 AEROSONIC CORPORATION Condensed Balance Sheets
July 31 January 31 1996 1996 ------------ ------------ Assets (unaudited) Current assets: Cash and cash equivalents $ 1,315,000 $ 10,000 Receivables: Trade, less allowance of $69 at 7/96 and 1/96 3,475,000 3,320,000 Officers and employees 15,000 6,000 Other 30,000 44,000 Income tax 425,000 436,000 Inventories 6,475,000 6,312,000 Prepaid expenses 48,000 37,000 Deferred income tax benefit 999,000 999,000 ------------ ------------ Total current assets 12,782,000 11,164,000 Property, plant and equipment Less allowance for depreciation 4,108,000 6,415,000 Other assets 159,000 272,000 ------------ ------------ $ 17,049,000 $ 17,851,000 ============ ============ Liabilities and shareholders' equity Current liabilities: Current installments of long-term debt $ 637,000 $ 712,000 Notes payable to bank 2,250,000 295,000 Accounts payable, trade 962,000 969,000 Other accrued expenses 1,604,000 1,606,000 Accrued litigation costs 0 1,775,000 ------------ ------------ Total current liabilities 5,453,000 5,357,000 Long-term debt, less current installments 1,869,000 2,814,000 Deferred income taxes 491,000 491,000 Shareholders' equity: Common stock, $.40 par; 8,000,000 shares authorized; 3,986,262 shares issued 1,595,000 1,595,000 Additional paid-in capital 3,410,000 3,410,000 Retained earnings 4,539,000 4,506,000 Less treasury stock, 194,571 shares at 1/31/96 178,753 shares at 7/31/96 (308,000) (322,000) ------------ ------------ Total shareholders equity 9,236,000 9,189,000 ------------ ------------ $ 17,049,000 $ 17,851,000 ============ ============ Note: The balance sheet at January 31, 1996 has been derived from the audited financial statements at this date. See Notes to Condensed Financial Statements.
2 AEROSONIC CORPORATION Condensed Statements of Operations (Unaudited)
Three Months Ended Six Months Ended July 31 July 31 ------------------------ ------------------------- 1996 1995 1996 1995 ----------- ----------- ----------- ----------- Net sales $ 5,710,000 $ 4,767,000 $10,699,000 $ 9,800,000 Cost of goods sold 4,039,000 3,751,000 7,822,000 7,456,000 ----------- ----------- ----------- ----------- Gross Profit 1,671,000 1,016,000 2,877,000 2,344,000 Selling, general and administrative expenses 1,245,000 1,274,000 2,469,000 2,489,000 ----------- ----------- ----------- ----------- Operating Income (loss) 426,000 (258,000) 408,000 (145,000) ----------- ----------- ----------- ----------- Other income (deductions): Provision for settlement of litigation 0 0 235,000 0 Interest expense, net 90,000 71,000 164,000 141,000 Other, net (39,000) (41,000) (54,000) (44,000) ----------- ----------- ----------- ----------- 51,000 30,000 335,000 97,000 ----------- ----------- ----------- ----------- Income (loss) before income taxes 375,000 (288,000) 73,000 (242,000) Income taxes 143,000 (109,000) 40,000 (92,000) ----------- ----------- ----------- ----------- Net Income (loss) $ 232,000 $ (179,000) $ 33,000 $ (150,000) =========== =========== =========== =========== Earnings per share: $ 0.06 $ -0.05 $ 0.01 $ -0.04 =========== =========== =========== =========== Weighted average number of shares outstanding 3,801,000 3,799,000 3,801,000 3,799,000 =========== =========== =========== ===========
See Notes to Condemsed Financial Statements 3 AEROSONIC CORPORATION Condensed Statements of Cash Flows (Unaudited)
Six Months Ended July 31 --------------------------- 1996 1995 ---- ---- Cash flows from operating activities: Net income (loss) $ 33,000 $ (150,000) Adjustment to reconcile net income to net cash provided by operating activities: Depreciation and amortization 401,000 379,000 Change in deferred income taxes (1,000) (107,000) Net increase in cash due to changes in current assets and liabilities (2,080,000) 293,000 ----------- ----------- Net cash provided by operating activities (1,647,000) 415,000 Cash flows from investing activities: Purchase of fixed assets 0 (1,014,000) Proceeds from sale of equipment 1,904,000 37,000 Net decrease in other assets 113,000 109,000 ----------- ----------- Net cash used in investing activities 2,017,000 (868,000) Cash flows from financing activities: Repayment on long-term debt (945,000) (418,000) Proceeds from borrowing 1,880,000 400,000 ----------- ----------- Net cash used by financing activities 935,000 (18,000) ----------- ----------- Net increase (decrease) in cash 1,305,000 (471,000) Cash, beginning of period 10,000 573,000 ----------- ----------- Cash, ending $ 1,315,000 $ 102,000 =========== =========== Supplemental disclosure of cash flow information Cash paid for: Interest $ 164,000 $ 148,000 ----------- ----------- Income taxes $ -- $ 2,000 ----------- ----------- Supplemental disclosure of noncash financing activity: During the quarter ended April 30, 1996, the Company reissued 8,019 shares of treasury stock to fund a portion of the Company's tax deferred savings plan. See Notes to Condensed Financial Statements
4 AEROSONIC CORPORATION NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED) JULY 31, 1996 NOTE A - BASIS OF PRESENTATION - ------------------------------ The accompanying unaudited condensed financial statements have been prepared in accordance with generally accepted accounting principles for interim financial reporting and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three month period ended July 31, 1996 are not necessarily indicative of the results that may be expected for the year ended January 31, 1997. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's annual report on form 10-K for the year ended January 31, 1996. NOTE B - SALE OF ORDNANCE ASSETS - -------------------------------- On July 10, 1996, the Company finalized the sale of the assets of the ordnance division for $1,700,000 in cash; the proceeds of which were partially used to pay down long term debt, with the balance being invested in marketable securities. For the second quarter, the company recorded a $41,000 gain on the sale of the Ordnance Division assets. NOTE C - INCREASED AVAILABILITY UNDER SHORT TERM BORROWINGS - ----------------------------------------------------------- On July 15, 1996, the Company was granted a $500,000 increase on its line of credit, taking the total to $2,000,000. The terms of the line of credit arrangement are comparable to the terms that had governed the Company's credit facility prior to the increase. As of July 31, 1996, the outstanding balance on the line of credit was $1,250,000. NOTE D - FINALIZATION OF THE SENSONICS SETTLEMENT - ------------------------------------------------- During the first quarter ended April 30, 1996, the Company finalized the settlement of the lawsuit with Sensonics, Inc., the details of which are reflected in the 10-Q report, dated April 30, 1996. Reflected in the year-to-date earnings figure is a $225,000 charge against first quarter earnings to finalize the settlement. 5 AEROSONIC CORPORATION MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULT OF OPERATIONS Net sales for the three months ended July 31, 1996 ("fiscal 1997") were $5,710,000 as compared to $4,767,000 for the same period last year. Net sales for the six months ended July 31, 1996 increased by 9% to $10,699,000 as compared to $9,800,000 for the same period last year. Included in prior year's sales was a $292,000 settlement for "Termination for convenience of the Government". The Avionics Specialties Division sales for the quarter ended July 31, 1996 were $2,761,000, an 11% increase over the same period in the prior fiscal year. The Clearwater Instrument Division sales for the quarter ended July 31, 1996 increased by 16% to $2,319,000. Net sales for the six months ended July 31, 1996 for the Avionics and Clearwater Instrument Division combined showed an improvement of 8%, or $744,000, over the same period in the prior fiscal year. Ordnance sales represented $958,000 of the net sales figure for the six months ended July 31, 1996 as compared to $833,000 during the same period in the prior fiscal year. However, the Ordnance Division had an overall negative impact on the profitability of the company as the market slowed in that product line. . Gross profit as a percentage of net sales improved in both the second quarter and the six months ended July 31, 1996 as compared to their respective periods in the prior fiscal year. The improvement is largely attributed to Company management's shift of focus away from Ordnance manufacturing and towards the instrument product line, its core business line. As a result of that shift of focus, Company management has reengineered and streamlined the instrument manufacturing process, including addressing permanent price increases on certain instrument lines, which were implemented in the second quarter. Reflective of the Company's continued philosophy towards controlling indirect costs, selling, general and administrative expenses continued to show a decline in both whole dollars and as a percentage of net sales in both the second quarter and the six months ended July 31, 1996 as compared to their respective periods in the prior fiscal year. Nonrecurring indirect costs for the six months ended July 31, 1996 consist of the provision for the settlement of the patent infringement lawsuit with Sensonics, Inc. The total cost for the Sensonics settlement in FY `97 equals $225,000, which was expensed in the first quarter; the terms of the settlement were outlined in the 10-Q dated April 30, 1996. The second quarter earnings include a $41,000 gain on the sale of the Ordnance Division assets, which occurred in July 1996. The Company recorded a net profit for the quarter of $232,000, or $.06 per share. Through the six months ended July 31, 1996, the company recorded a net profit of $47,000, or $.01 per share, inclusive of the $41,000 gain on the sale of the Ordnance Division and despite the $225,000 charge against first quarter earnings for the settlement of the Sensonics suit. 6 Working capital increased by $1,522,000 to $7,329,000 during the six months ended July 31, 1996. The improvement was largely due to the cash provided by the sale of the Ordnance Division, reduction in the litigation accrual and debt repayment. Interest expense increased by $23,000 to $164,000 during the six months ended July 31, 1994 as compared to the same period in the prior fiscal year largely due to heavier borrowings under the company's line of credit arrangement to fund the settlement with Sensonics, Inc. Backlog as of July 31, 1996 was $14,709,000, as compared to a backlog of $17,356,000 during the same period in the prior fiscal year. However, $3,021,000 of the prior year's backlog figure was attributed to the Ordnance Division. As of July 31, 1996, the Company was back in compliance with its bank loan covenants and was granted a $500,000 increase on its revolving line of credit, taking it to $2,000,000. The outstanding balance on the Company's line of credit as of July 31, 1996 was $1,250,000. 7 AEROSONIC CORPORATION MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULT OF OPERATIONS A summary of the period-to-period changes in the principal items included in the Statements of Operations is shown below: Three Months Ended Three Months Ended 7/31/96 - 7/31/95 7/31/96 - 4/30/96 $ (000) % $ (000) % ------- ----- ------- ----- Net sales 943,000 20 721,000 14 Cost of sales 288,000 8 256,000 7 Operating expenses (26,000) (2) (16,000) (1) Interest and other expenses 19,000 27 16,000 22 Income taxes 251,000 (230) 244,000 (239) ------- ---- ------- ----- Net income 411,000 (230) 221,000 2,009 ======= ==== ======= ===== Six Months Ended 7/31/96 - 7/31/95 $ (000) % ------- ----- Net sales 899,000 9 Cost of sales 366,000 5 Operating expenses 195,000 8 Interest and other expenses 23,000 16 Income taxes 132,000 (143) ------- ---- Net income 183,000 (122) ======= ==== 8 PART II. OTHER INFORMATION AEROSONIC CORPORATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits Exhibit 11: Computation of Earnings Per Share Exhibit 27: Financial Data Schedule (Electronic filing only) (b) Reports on Form 8-K The Company filed a report on Form 8-K on June 7, 1996, regarding Item 1: Changes in Control of Registrant. The company reported that J. Mervyn Nabors purchased 1,087,000 shares of common stock from the Herbert J. Frank Revocable Trust. The Company filed a report on form 8-K on June 14, 1996, regarding Item 2: Acquisition and Disposition of Assets. The company reported that it had entered into an agreement with National Metalworking Corporation, an affiliated company of Bulova Technologies LLC, to sell the Ordnance Division assets. 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. AEROSONIC CORPORATION --------------------- (Registrant) Date: September 19, 1996 /s/ J. Mervyn Nabors ---------------------- ---------------------------- J. Mervyn Nabors, President and Chief Executive Officer 9 EX-11 2 COMPUTATION OF EARNINGS PER SHARE Exhibit 11 Weighted Average Common Shares and Common Equivalents Outstanding Computations of Earnings Per Share (In thousands, except per share data)
For the three months ended For the six months ended -------------------------- -------------------------- July 31 July 31 July 31 July 31 1996 1995 1996 1995 --------- --------- --------- --------- Primary earnings per share: Net income $ 232,000 (179,000) $ 33,000 (150,000) --------- --------- --------- --------- Weighted average number of common and common share equivalents 3,801,000 3,793,000 3,801,000 3,796,000 ========= ========= ========= ========= Primary earnings per share $ 0.06 -0.05 $ 0.01 -0.04 ========= ========== ========= ========== There are no other common stock equivalents so that primary and fully diluted earnings per share are equal.
10 EX-27 3 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF AEROSONIC CORPORATION FOR THE THREE MONTHS ENDED JULY 31, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 6-MOS JAN-31-1997 FEB-01-1996 JUL-31-1996 1,315 0 3,589 69 6,475 12,782 7,103 2,995 17,049 5,453 0 0 0 1,595 7,641 17,049 10,699 10,699 7,822 7,822 2,469 0 164 73 40 33 0 0 0 33 .01 .01
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