-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, thnvaMYgf8IUlxmJAI7Eh8tNVxARFDTVUYmS6/Q7ISuU3orfQP5Z/kks091+3ldn FdncvyyvfSvojVVJqKfPrw== 0000898430-94-000366.txt : 19940516 0000898430-94-000366.hdr.sgml : 19940516 ACCESSION NUMBER: 0000898430-94-000366 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19940331 FILED AS OF DATE: 19940513 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CUBIC CORP /DE/ CENTRAL INDEX KEY: 0000026076 STANDARD INDUSTRIAL CLASSIFICATION: 3812 IRS NUMBER: 951678055 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-08931 FILM NUMBER: 94528292 BUSINESS ADDRESS: STREET 1: 9333 BALBOA AVE CITY: SAN DIEGO STATE: CA ZIP: 92123 BUSINESS PHONE: 6192776780 MAIL ADDRESS: STREET 1: PO BOX 85587 CITY: SAN DIEGO STATE: CA ZIP: 92186-5587 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarter Ended March 31, 1994 1-8931 ------ Commission File Number CUBIC CORPORATION Exact Name of Registrant as Specified in its Charter Delaware 95-1678055 -------- ---------- State of Incorporation IRS Employer Identification No. 9333 Balboa Avenue San Diego, California 92123 Telephone (619) 277-6780 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, and (2) has been subject to such filing requirements for the past 90 days. Yes X No___ --- As of April 25, 1994, Registrant had only one class of common stock of which there were 6,001,719 shares outstanding (after deducting 1,923,895 shares held as treasury stock). PART I - FINANCIAL INFORMATION ITEM 1 - FINANCIAL STATEMENTS CUBIC CORPORATION CONSOLIDATED CONDENSED STATEMENT OF INCOME (UNAUDITED) (amounts in thousands, except per share data)
Six Months Ended Three Months Ended March 31 March 31 1994 1993 1994 1993 --------- --------- --------- --------- Revenues: Net sales $ 98,324 $103,219 $49,917 $ 50,931 Other income 4,501 2,795 2,334 1,566 -------- -------- ------- -------- 102,825 106,014 52,251 52,497 Costs and expenses: Cost of sales 76,404 83,653 38,504 43,497 Selling, general and administrative expenses 23,354 22,432 12,121 11,895 Research and development 1,460 2,155 858 1,009 Interest 1,221 1,169 632 583 -------- -------- ------- -------- 102,439 109,409 52,115 56,984 -------- -------- ------- -------- Income (loss) from continuing operations before income taxes and cumulative effect of accounting change 386 (3,395) 136 ( 4,487) Income tax credit (2,000) (50) (2,285) ------- -------- ------- -------- Income (loss) from continuing operations before cumulative effect of accounting change 386 (1,395) 186 (2,202) Discontinued operations, net of applicable income taxes: Income from operations 767 359 Net gain (loss) on disposal (153) 20,103 20,103 -------- -------- ------- -------- Income (loss) from discontinued operations (153) 20,870 20,462 -------- -------- ------- -------- Income before cumulative effect of accounting change 233 19,475 186 18,260 Cumulative effect of accounting change -- Note C 1,379 -------- -------- ------- -------- Net income $ 1,612 $ 19,475 $ 186 $ 18,260 ======== ======== ======= ======== Average shares of common stock outstanding 6,056 6,105 6,031 6,087 ======== ======== ======= ======== Per share data: Income (loss) from continuing operations $ .06 $ (.23) $ .03 $ (.36) Income (loss) from discontinued operations (.03) 3.42 3.36 Cumulative effect of accounting change .23 -------- -------- ------- -------- Net income $ .26 $ 3.19 $ .03 $ 3.00 ======== ======== ======= ======== Dividends per share $ .265 $ .265 $ .265 $ .265 ======== ======== ======= ========
See accompanying notes. 1 CUBIC CORPORATION CONSOLIDATED CONDENSED BALANCE SHEET (thousands of dollars)
March 31 September 30 1994 1993 (Unaudited) (See note below) ----------- ---------------- ASSETS Current assets: Cash and cash equivalents $ 38,323 $ 24,496 Marketable securities 11,376 17,383 Accounts receivable 102,044 114,288 Inventories: Finished products 1,285 1,330 Work in process 12,278 8,475 Raw material and purchased parts 10,439 8,108 -------- -------- 24,002 17,913 Other current assets 5,989 6,646 -------- -------- Total current assets 181,734 180,726 Property, plant and equipment - net 27,992 28,038 Toll equipment under operating leases - net 18,909 19,952 Preferred stock of U. S. Elevator Corp. 20,000 20,000 Net assets of discontinued operation 2,840 2,823 Other assets 15,626 13,029 -------- -------- $267,101 $264,568 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable and other current liabilities $ 64,838 $ 62,721 Income taxes 572 1,040 Current portion of long-term debt 100 -------- -------- Total current liabilities 65,410 63,861 Long-term debt 39,943 37,343 Deferred income taxes and other 3,797 3,812 Shareholders' equity: Common stock 234 234 Additional paid-in capital 12,123 12,123 Retained earnings 178,885 178,867 -------- -------- 191,242 191,224 Less treasury stock at cost 33,291 31,672 -------- -------- 157,951 159,552 -------- -------- $267,101 $264,568 ======== ========
Note: The balance sheet at September 30, 1993 has been derived from the audited financial statements at that date. See accompanying notes. 2 CUBIC CORPORATION CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS (UNAUDITED) (thousands of dollars)
Six Months Ended March 31 1994 1993 -------- -------- Operating Activities: Net income $ 1,612 $ 19,475 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Gain on the sale of U.S. Elevator Corp, before income taxes (25,103) Depreciation and amortization 4,431 4,432 Change in accounting principle (1,379) Undistributed earnings of affiliates, net of distributions (744) (1,427) Changes in operating assets and liabilities 9,525 (310) -------- -------- NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 13,445 (2,933) Investing Activities: Proceeds from the sale of U.S. Elevator Corp. 40,000 Decrease in marketable securities 6,007 13,699 Net additions to property, plant and equipment and toll equipment under operating leases (3,313) (12,892) Other items - net (1,600) (1,573) -------- -------- NET CASH PROVIDED BY INVESTING ACTIVITIES 1,094 39,234 Financing Activities: Principal payments on long-term debt (2,100) (4,850) Long-term borrowing 4,600 Purchases of treasury stock (1,619) (1,054) Dividends paid (1,593) (1,613) -------- -------- NET CASH USED IN FINANCING ACTIVITIES (712) (7,517) -------- -------- NET INCREASE IN CASH AND CASH EQUIVALENTS 13,827 28,784 Cash and cash equivalents at the beginning of the period 24,496 31,126 -------- -------- CASH AND CASH EQUIVALENTS THE END OF THE PERIOD $ 38,323 $ 59,910 ======== ========
See accompanying notes. 3 CUBIC CORPORATION NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS March 31, 1994 A. Basis for Presentation ---------------------- The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with the instructions to Form 10-Q and therefore do not include all information and footnotes necessary for a fair presentation of financial position, results of operations, and cash flows in conformity with generally accepted accounting principles. The information furnished reflects all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary for a fair statement of the results for the interim periods. Results for the quarter are not necessarily indicative of the results to be expected for the year. Certain prior period amounts have been reclassified to conform to current period classifications. B. Per Share Amounts ----------------- Per share amounts are based upon the weighted average number of shares of common stock outstanding. C. Change in Accounting for Income Taxes ------------------------------------- Effective October 1, 1993, the Company adopted Financial Accounting Standards Board Statement No. 109, "Accounting for Income Taxes". Under the provisions of this new standard, the Company must now recognize, to a greater degree, the future tax benefits of certain expenses which previously had been recognized in the financial statements without tax benefit. As permitted by the standard, the Company has elected not to restate the financial statements of any prior periods. The change was applied retroactively to certain elements of deferred income taxes originating in prior years and resulted in a cumulative effect adjustment of $1,379,000, which was included in net income for the quarter ended December 31, 1993. Significant components of the Company's deferred tax assets and liabilities as of October 1, 1993 are as follows (in thousands):
Deferred tax assets: Accrued liabilities and other $3,894 Inventories 2,354 Long-term contract receivables 2,355 ------ $8,603 ====== Deferred tax liabilities: Leveraged leases $3,755 Property, plant and equipment 2,585 Other - net 1,035 ------ $7,375 ======
4 CUBIC CORPORATION NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS--CONTINUED D. Subsequent Event ---------------- On April 8, 1994, the Company acquired all of the assets and assumed certain liabilities of the Titan Applications Group and Titan Services International divisions of The Titan Corporation, for cash in the amount of $21 million. The purchase price, which was determined by auction bid, is subject to an upward or downward post-closing adjustment based on the amount of net assets as reflected in the Closing Balance Sheet. The Company intends to devote the acquired assets to continuation of the business of these divisions, which will operate as a subsidiary of the Company, within the electronic defense systems segment. E. Review by Independent Accountants --------------------------------- A review of the data presented was made by Ernst & Young, independent accountants, in accordance with established professional standards and procedures, and their report is included herein. 5 CUBIC CORPORATION ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL ---------------------------------------------------------- CONDITION AND RESULTS OF OPERATIONS March 31, 1994 Sales from continuing operations for the quarter ended March 31, 1994, were down slightly from the same quarter in the previous year due to lower sales volume in the electronic defense systems segment. This decrease was partially offset by increased sales in the automatic revenue collection systems segment. These results are consistent with the trend in recent quarters due to increased competition in the defense market caused by reduced U.S. Government spending and the Company's success in obtaining contracts in the revenue collection business. Income from continuing operations for the three and six month periods ending March 31, 1994 were substantially improved from the losses incurred in the same periods of fiscal 1993. This improvement was the result of profits on revenue collection system contracts in the first half of fiscal 1994, compared to losses incurred by this segment during the first half of fiscal 1993. Operating profits in the electronic defense systems segment for the quarter ended March 31, 1994 were slightly lower than in the second quarter of fiscal 1993, commensurate with the decline in sales volume for the segment. The provisions for income taxes were different from statutory income tax rates in all periods primarily as a result of the Company's tax exempt interest and dividend income, and its equity share in the net income of its 50% owned foreign subsidiary which is not subject to federal income taxes. The Company's financial condition remains strong with working capital of $116.5 million at March 31, 1994, compared to $116.9 million at September 30, 1993. The Company experienced positive cash flow from operations for the first six months of fiscal 1994, resulting primarily from reductions in accounts receivable during the period. The backlog of orders was $288.4 million at March 31, 1994 compared to $246.7 million at September 30, 1993 and $236.4 million at March 31, 1993. 6 PART II - OTHER INFORMATION ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K (a) The following exhibit is included herein: 28--Independent Accountants' Review Report (b) Registrant filed a Form 8-K as of April 8, 1994 to report the acquisition of all the assets and certain liabilities of the Titan Applications Group and Titan Services International divisions of the Titan Corporation. 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. CUBIC CORPORATION Date May 11, 1994 /s/ W. W. Boyle ----------------- ------------------------- W. W. Boyle Vice President Finance and CFO Date May 11, 1994 /s/ T. A. Baz ---------------- ------------------------------- T. A. Baz Vice President and Controller 7 EX-28 2 ACCOUNTANTS' CONSENT EXHIBIT 28 -- INDEPENDENT ACCOUNTANTS' REVIEW REPORT Board of Directors Cubic Corporation San Diego, California We have reviewed the accompanying consolidated condensed balance sheet of Cubic Corporation as of March 31, 1994, and the related consolidated condensed statements of income for the three and six-month periods ended March 31, 1994 and 1993, and consolidated condensed statement of cash flows for the six-month periods ended March 31, 1994 and 1993. These financial statements are the responsibility of the Company's management. We conducted our reviews in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data, and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, which will be performed for the full year with the objective of expressing an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to the accompanying consolidated condensed financial statements referred to above for them to be in conformity with generally accepted accounting principles. We have previously audited, in accordance with generally accepted auditing standards, the consolidated balance sheet of Cubic Corporation as of September 30, 1993, and the related consolidated statements of income, retained earnings, and cash flows for the year then ended (not presented herein) and in our report dated December 8, 1993, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated condensed balance sheet at September 30, 1993, is fairly stated in all material respects in relation to the consolidated balance sheet from which it has been derived. ERNST & YOUNG May 5, 1994 -----END PRIVACY-ENHANCED MESSAGE-----