-----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, GoutntIDEh56JW0zqiMny2FcpHGujsPjYKMe6VFp2aMtzRd5nnoRPs56nFk1hOod Lqt/6ipug4RFkf6VqY/cRA== 0000016590-97-000012.txt : 19970724 0000016590-97-000012.hdr.sgml : 19970724 ACCESSION NUMBER: 0000016590-97-000012 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970628 FILED AS OF DATE: 19970723 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: CAMBEX CORP CENTRAL INDEX KEY: 0000016590 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER STORAGE DEVICES [3572] IRS NUMBER: 042442959 STATE OF INCORPORATION: MA FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-06933 FILM NUMBER: 97644324 BUSINESS ADDRESS: STREET 1: 360 SECOND AVE CITY: WALTHAM STATE: MA ZIP: 02154 BUSINESS PHONE: 6178906000 MAIL ADDRESS: STREET 2: 360 SECOND AVE CITY: WALTHAM STATE: MA ZIP: 02154 FORMER COMPANY: FORMER CONFORMED NAME: CAMBRIDGE MEMORIES INC DATE OF NAME CHANGE: 19801204 10-Q 1 10Q-Q297/QTR END 6/28/97 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 Quarterly Report Under Section 13 Or 15(d) Of The Securities Exchange Act Of 1934 For the Quarter Ended: June 28, 1997 Commission File No: 0-6933 CAMBEX CORPORATION (Exact name of registrant as specified in its charter) Massachusetts 04-244-2959 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 360 Second Avenue, Waltham, Massachusetts (Address of principal executive offices) 02154 (Zip Code) Registrant's telephone number, including area code: (617) 890-6000 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 CAMBEX CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS JUNE 28, 1997 AND DECEMBER 31, 1996 (UNAUDITED) ASSETS JUNE 28, DECEMBER 31, 1997 1996 ------------- ------------- CURRENT ASSETS: CASH AND CASH EQUIVALENTS $ 551,156 $ 615,949 ACCOUNTS RECEIVABLE, LESS RESERVES OF $131,000 ON JUNE 28, 1997 AND $131,000 ON DECEMBER 31, 1996 1,765,448 1,934,708 CURRENT PORTION OF INVESTMENT IN SALES-TYPE LEASES, NET OF UNEARNED INTEREST INCOME OF $11,000 ON JUNE 28, 1997 AND $34,000 ON DECEMBER 31, 1996 186,143 423,220 INVENTORIES 5,399,110 6,200,033 PREPAID TAXES - 2,335,295 PREPAID EXPENSES 117,161 135,721 -------------- -------------- TOTAL CURRENT ASSETS $ 8,019,018 $ 11,644,926 -------------- -------------- LONG-TERM INVESTMENT IN SALES-TYPE LEASES, NET OF UNEARNED INTEREST INCOME OF $2,000 ON JUNE 28, 1997 AND $5,000 ON DECEMBER 31, 1996 $ 55,932 $ 162,971 LEASED EQUIPMENT, AT COST, NET OF ACCUMULATED DEPRECIATION OF $296,000 ON JUNE 28, 1997 AND $244,000 ON DECEMBER 31, 1996 $ 88,043 $ 140,417 PROPERTY AND EQUIPMENT, AT COST: MACHINERY AND EQUIPMENT $ 7,392,541 $ 7,379,202 FURNITURE AND FIXTURES 304,666 304,666 LEASEHOLD IMPROVEMENTS 620,949 620,949 -------------- -------------- $ 8,318,156 $ 8,304,817 LESS - ACCUMULATED DEPRECIATION AND AMORTIZATION 7,603,673 7,258,383 -------------- -------------- NET PROPERTY AND EQUIPMENT $ 714,483 $ 1,046,434 OTHER ASSETS TECHNOLOGY LICENSE/MARKETING AGREEMENT, NET OF ACCUMULATED AMORTIZATION OF $8,500,000 ON JUNE 28, 1997 AND ON DECEMBER 31, 1996 $ - $ - OTHER 37,830 37,830 -------------- -------------- TOTAL ASSETS $ 8,915,306 $ 13,032,578 ============== ==============
-2- CONSOLIDATED BALANCE SHEETS JUNE 28, 1997 AND DECEMBER 31, 1996 (UNAUDITED) LIABILITIES AND STOCKHOLDERS' INVESTMENT JUNE 28, DECEMBER 31, 1997 1996 ------------- -------------- CURRENT LIABILITIES: REVOLVING CREDIT AGREEMENT $ -- $ 1,800,000 ACCOUNTS PAYABLE 4,463,574 4,329,638 OBLIGATIONS FOR TRADE-IN MEMORY 901,772 1,036,235 ACCRUED EXPENSES 1,418,287 1,319,237 ------------- -------------- TOTAL CURRENT LIABILITIES $ 6,783,633 $ 8,485,110 ------------- -------------- DEFERRED REVENUE $ 491,993 $ 1,022,751 STOCKHOLDERS' INVESTMENT: PREFERRED STOCK, $1.00 PAR VALUE PER SHARE AUTHORIZED - 3,000,000 SHARES ISSUED - NONE -- -- COMMON STOCK, $.10 PAR VALUE PER SHARE - AUTHORIZED - 25,000,000 SHARES ISSUED - 10,615,039 SHARES ON JUNE 28, 1997 AND 10,614,139 SHARES ON DECEMBER 31, 1996 $ 1,061,504 $ 1,061,414 CAPITAL IN EXCESS OF PAR VALUE 15,792,240 15,792,105 CUMULATIVE TRANSLATION ADJUSTMENT 93,411 183,355 RETAINED EARNINGS (DEFICIT) (14,452,709) (12,657,391) LESS - COST OF SHARES HELD IN TREASURY - 1,534,356 ON JUNE 28, 1997 AND ON DECEMBER 31, 1996 (854,766) (854,766) ------------- -------------- TOTAL STOCKHOLDERS' INVESTMENT $ 1,639,680 $ 3,524,717 ------------- -------------- TOTAL LIABILITIES AND STOCKHOLDERS' INVESTMENT $ 8,915,306 $ 13,032,578 ============= ==============
-3- CAMBEX CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME FOR THE SIX MONTHS ENDED JUNE 28, 1997 AND JUNE 29, 1996 (UNAUDITED) QUARTER ENDED SIX MONTHS ENDED JUNE 28, JUNE 29, JUNE 28, JUNE 29, 1997 1996 1997 1996 ------------ ------------ ------------ ------------ REVENUES $ 4,375,902 $ 7,123,673 $ 7,402,635 $ 15,143,354 COST OF SALES 2,850,962 3,334,490 4,698,508 7,816,235 ------------ ------------- ------------- ------------- GROSS PROFIT $ 1,524,940 $ 3,789,183 $ 2,704,127 $ 7,327,119 OPERATING EXPENSES: RESEARCH AND DEVELOPMENT $ 747,516 $ 916,345 $ 1,512,404 $ 2,082,793 SELLING 1,026,156 1,761,483 2,206,502 3,803,630 GENERAL AND ADMINISTRATIVE 314,383 528,905 712,493 1,228,898 ------------ ------------- ------------- ------------- $ 2,088,055 $ 3,206,733 $ 4,431,399 $ 7,115,321 ------------ ------------- ------------- ------------- OPERATING INCOME (LOSS) $ (563,115) $ 582,450 $ (1,727,272) $ 211,798 OTHER INCOME (EXPENSE): INTEREST EXPENSE $ (9,876) $ (64,878) $ (43,454) $ (135,133) INTEREST INCOME 4,042 30,108 19,318 56,572 OTHER INCOME (EXPENSE) (14,281) (343,487) (43,910) (917,077) ------------ ------------- ------------- ------------- INCOME (LOSS) BEFORE INCOME TAXES $ (583,230) $ 204,193 $ (1,795,318) $ (783,840) PROVISION FOR INCOME TAXES $ 0 $ 0 $ 0 $ 0 ------------ ------------- ------------- ------------- NET INCOME (LOSS) $ (583,230) $ 204,193 $ (1,795,318) $ (783,840) ============ ============= ============= ============= NET INCOME (LOSS) PER COMMON SHARE $ (0.06) $ 0.02 $ (0.20) $ (0.09) ============ ============= ============= ============= WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING 9,080,000 8,975,000 9,080,000 8,950,000
-4- CAMBEX CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 28, 1997 AND JUNE 29, 1996 FOR THE SIX MONTHS ENDED JUNE 28, JUNE 29, 1997 1996 ---------- ---------- CASH FLOWS FROM OPERATING ACTIVITIES: Net Income (Loss) $ (1,795,318) $ (783,840) Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation and amortization $ 397,664 $ 1,226,227 Amortization of prepaid expenses 28,990 14,074 Common stock issued in lieu of cash -- 110,938 Change in assets and liabilities: Decrease in accounts receivable 169,260 781,995 Decrease in inventory 800,923 205,155 Decrease in investment in sales-type leases 344,116 7,118 Decrease in prepaid taxes 2,335,295 2,257,928 Increase in prepaid expenses (10,430) (6,444) Decrease in other assets -- 30 Increase (decrease) in accounts payable 133,936 (596,158) Decrease in obligations for trade-in memory (134,463) (245,909) Increase (decrease) in accrued liabilities 99,050 (27,283) Increase (decrease) in deferred revenue (530,758) 233,706 ------------- ------------ Total adjustments $ 3,633,583 $ 3,961,377 ------------- ------------ Net cash provided by operating activities $ 1,838,265 $ 3,177,537 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of Equipment $ (13,339) $ (123,258) ------------ ------------ Net cash used in investing activities $ (13,339) $ (123,258) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from sale of common stock $ 225 $ 61,491 Repayments under revolving credit agreement (1,800,000) (560,000) ------------- ------------ Net cash used in financing activities $ (1,799,775) $ (498,509) Effect of exchange rate changes on cash (89,944) (114,519) ------------ ------------ Net increase (decrease) in cash and cash equivalents $ (64,793) $ 2,441,251 Cash and cash equivalents at beginning of period $ 615,949 $ 588,322 ------------- ------------ Cash and cash equivalents at end of period $ 551,156 $ 3,029,573 ============= ============ SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the period for: Interest $ 43,454 $ 135,133 Income Taxes -- 11,984
-5- FORM 10-Q CAMBEX CORPORATION AND SUBSIDIARIES For The Quarter Ended: June 28, 1997 Commission File No: 0-6933 Notes & Comments: (1)Significant Accounting Policies The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation. The Company has deferred revenue associated with the sale of certain products which have future performance obligations, principally relating to reinstallation of IBM memory. The condensed financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. The information furnished includes all adjustments and accruals consisting only of normal recurring accrual adjustments which are, in the opinion of management, necessary for a fair presentation of results for the interim period. It is suggested that these condensed financial statements be read in conjunction with the financial statements and the notes thereto included in the Company's latest annual report on Form 10-K. Inventories, which include raw materials, labor and manufacturing overhead are stated at the lower of cost (first-in, first-out) or market and consist of the following: June 28, December 31, 1997 1996 Raw materials $2,474,639 $ 2,386,454 Work-in-process 676,221 861,073 Finished goods 2,046,750 2,765,066 Trade-in memory 201,500 187,500 $5,399,110 $ 6,200,033 - 6 - FORM 10-Q CAMBEX CORPORATION AND SUBSIDIARIES For The Quarter Ended: June 28, 1997 Commission File: 0-6933 Notes & Comments (Continued): (2) Income and Dividends Per Share Per share amounts are based on the weighted average number of shares outstanding during each year plus applicable common stock equivalents. There were no material differences for per share amounts assuming full dilution in either year. (3) Management's Discussion and Analysis of Financial Condition and Results of Operations Revenues for the second quarter ended June 28, 1997 decreased 39% from the comparable three months of the prior year due principally to decreased sales of the Company's mainframe storage products. The gross profit (35%) for the second quarter of 1997 was lower than the 53% achieved in 1996 due to product mix and to the relative amount of fixed costs in relation to lower revenues. Operating expenses for the three months ended June 28, 1997 decreased 35% from the comparable three months of the prior year due principally to the cost savings achieved through a work force reduction and other expense controls put in place. Other expense for the three months ended June 29, 1996 included approximately $425,000 in amortization expenses relating to the Company's technology license/marketing agreement, which was amortized over a five year period, ending in 1996. During the first quarter, the Company received approximately $2,300,000 in cash from the Internal Revenue Service, which represented the refund due from prior periods. This refund was then used to repay the Company's outstanding debt under its Revolving Credit Agreement. After the final payment to its bank, the Revolving Credit Agreement was terminated and the bank released its security interest in the Company's accounts receivable, inventory and general intangibles. - 7 - FORM 10-Q CAMBEX CORPORATION AND SUBSIDIARIES For The Quarter Ended: June 28, 1997 Commission File: 0-6933 Notes & Comments (Continued): The Company's present operating plans indicate that cash flow generated from operations will be adequate to meet its obligations. - 8 - FORM 10-Q CAMBEX CORPORATION AND SUBSIDIARIES For The Quarter Ended: June 28, 1997 Commission File: 0-6933 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. CAMBEX CORPORATION By: /s/ Joseph F. Kruy Joseph F. Kruy President By: /s/ Sheldon M. Schenkler Sheldon M. Schenkler Chief Financial Officer Dated: July 27, 1997 - 9 - EX-27 2
5 1000 6-MOS DEC-31-1997 JUN-28-1997 551 0 1896 131 5399 8019 8318 7604 8915 6784 0 0 0 1062 578 8915 7403 7403 4699 4699 4456 0 43 (1795) 0 (1795) 0 0 0 (1795) (0.20) (0.20)
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