-----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, V2xqdVGEji3V9bXZb7HYf9y5B/biuWxT1wCsX7fKp+6Dvj6GjATYchbrQ+V8eRGN Pai9opx4ZzC3I1fW5f9olQ== 0000898430-94-000446.txt : 19940705 0000898430-94-000446.hdr.sgml : 19940705 ACCESSION NUMBER: 0000898430-94-000446 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19940408 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19940622 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: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-08931 FILM NUMBER: 94535179 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 8-K/A 1 AMENDED 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8K-A AMENDMENT TO REPORT AMENDMENT NO. 1 Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 CUBIC CORPORATION Exact Name of Registrant as Specified in its Charter The undersigned Registrant hereby amends the following items, financial statements, exhibits or other portions of its Current Report on Form 8-K as set forth in the pages attached hereto: ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (a). Financial Statements of Business Acquired (b). Pro Forma Financial Information Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this amendment to be signed on its behalf by the undersigned, thereunto duly authorized. CUBIC CORPORATION By: /s/ Thomas A. Baz --------------------------------------- Thomas A. Baz Vice President and Controller Dated: June 21, 1994. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS The following financial statements, pro forma financial information and exhibits are filed as a part of this report. a. Financial statements of the business acquired, prepared pursuant to Rule 3.05 of Regulation S-X and provided to the Registrant by The Titan Corporation. Audited financial statements of The Applications Group of The Titan Corporation (Titan Applications Group). Report of Arthur Andersen & Co., Certified Public Accountants See page 5 Statement of Certain Specified Assets and Liabilities -- as of October 1, 1993 See page 6 Statements of Operating Income -- for the nine month period ended October 1, 1993 and the years ended December 31, 1992, 1991 and 1990 See page 7 Notes to Statement of Certain Specified Assets and Liabilities and Statements of Operating Income See page 8 Unaudited condensed interim financial statements of Titan Applications Group. Statement of Certain Specified Assets and Liabilities -- as of March 31, 1994 See page 11 Statement of Operating Income -- Six months ended March 31, 1994 See page 12 1 b. Pro forma financial information required pursuant to Article 11 of Regulation S-X. Cubic Corporation and Titan Applications Group Pro Forma Condensed Combined Financial Statements (Unaudited). Pro Forma Condensed Combined Balance Sheet -- March 31, 1994 See page 14 Pro Forma Condensed Combined Statement of Income -- Year ended September 30, 1993 See page 15 Pro Forma Condensed Combined Statement of Income -- Six months ended March 31, 1994 See page 16 Notes to Pro Forma Condensed Combined Financial Statements See page 17 c. Exhibits Exhibit 23 -- Consent of independent public accountants. 2 a. FINANCIAL STATEMENTS OF THE BUSINESS ACQUIRED The financial statements presented herein include all of the pertinent information available related to the assets acquired and liabilities assumed, but do not include all of the financial statements required by Rule 3.05 of Regulation S-X. It would not be practicable to provide such financial statements because the assets acquired and the liabilities assumed do not represent a separate entity but were commingled with other assets and liabilities of The Titan Corporation. The Titan Corporation prepared, and its independent accountants audited, a special report of the assets and liabilities which it intended to sell along with a statement reflecting the results of operations related to those specified assets and liabilities. These audited financial statements are presented herein. A complete set of financial statements prepared in accordance with generally accepted accounting principles would also have included a complete income statement, statement of equity and a statement of cash flows. It would not be possible to prepare such statements without making numerous assumptions as to the transactions which might have taken place had the business involved been a separate entity. Therefore, such statements would be both time and cost prohibitive to prepare as they would require the re- creation of past history. 3 TITAN Titan Applications Group Statement of Certain Specified Assets and Liabilities As of October 1, 1993, and Statements of Operating Income, For the Nine Month Period Ended October 1, 1993 and the Years Ended December 31, 1992, 1991 and 1990 Together With Auditors' Report 4 ARTHUR ANDERSEN & CO. REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Board of Directors and Management of The Titan Corporation: We have audited the accompanying statement of certain specified assets and liabilities of the Titan Applications Group, an operating group of The Titan Corporation (a Delaware Corporation) as of October 1, 1993, and the statements of operating income for the nine-month period ended October 1, 1993 and for the years ended December 31, 1992, 1991 and 1990. These statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits of the Titan Applications Group. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform an audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. The financial statements have been prepared in contemplation of a sale through Banker's Trust of certain specified assets and liabilities of the Titan Applications Group, described in Note 1, and is not intended to be a complete presentation of the Titan Applications Group's assets and liabilities. In our opinion, the financial statements referred to above present fairly, in all material respects, certain specified assets and liabilities of the Titan Applications Group of The Titan Corporation as of October 1, 1993, as defined by management as referred to in Note 1 of the notes to the financial statements, and the results of operations for the nine-month period ended October 1, 1993, and for the years ended December 31, 1992, 1991 and 1990, in conformity with generally accepted accounting principles. As explained in note 5 to these statements, on March 5, 1994, the Titan Corporation entered into an agreement to sell the Applications Group. Washington, D.C., November 17, 1993 /s/ Arthur Andersen & Co. (except with respect to the matter discussed in Note 5, as to which the date is March 5, 1994). 5 TITAN APPLICATIONS GROUP ------------------------ STATEMENT OF CERTAIN SPECIFIED ASSETS AND LIABILITIES ----------------------------------------------------- AS OF OCTOBER 1, 1993 --------------------- ASSETS ------ CURRENT ASSETS: Billed accounts receivable $3,519,169 Unbilled accounts receivable 2,976,016 Prepaid expenses and other current assets 249,722 ---------- Total current assets 6,744,907 ---------- PROPERTY AND EQUIPMENT: Office equipment 594,857 Furniture and fixtures 70,228 ---------- 665,085 Less - Accumulated depreciation (351,779) ---------- Net property and equipment 313,306 ---------- Total assets $7,058,213 ==========
LIABILITIES AND CORPORATE EQUITY -------------------------------- CURRENT LIABILITIES: Accounts payable $1,985,680 Billings in excess of revenue recognized 1,409,194 Accrued liabilities 1,004,372 ---------- Total current liabilities 4,399,246 COMMITMENTS AND CONTINGENCIES (Note 4) TITAN CORPORATE EQUITY IN TITAN APPLICATIONS GROUP 2,658,967 ---------- Total liabilities and corporate equity $7,058,213 ==========
The accompanying notes are an integral part of this statement of certain specified assets and liabilities and corporate equity. 6 TITAN APPLICATIONS GROUP ------------------------ STATEMENTS OF OPERATING INCOME ------------------------------
Nine-Month Period Ended Year Ended December 31, October 1, --------------------------------------- 1993 1992 1991 1990 ----------- ----------- ----------- ----------- REVENUES $21,462,659 $15,262,310 $11,647,668 $7,048,129 COSTS AND EXPENSES: Cost of revenues 18,236,929 12,505,859 9,573,212 5,826,101 Selling, general and administrative 1,728,249 1,504,303 1,253,543 925,057 ----------- ----------- ----------- ---------- OPERATING INCOME $ 1,497,481 $ 1,252,148 $ 820,913 $ 296,971 =========== =========== =========== ==========
The accompanying notes are an integral part of these statements of operating income. 7 TITAN APPLICATIONS GROUP ------------------------ NOTES TO STATEMENT OF CERTAIN SPECIFIED ASSETS AND LIABILITIES -------------------------------------------------------------- AND STATEMENTS OF OPERATING INCOME ----------------------------------- 1. BASIS OF PRESENTATION: ---------------------- These statements have been prepared in contemplation of the sale of the Titan Applications Group ("Applications") of The Titan Corporation, a public corporation. Refer to filings with the Securities and Exchange Commission for additional information regarding The Titan Corporation. The statement of certain specified assets and liabilities and statements of operating income reflect the assets and liabilities and results of operation of Applications, as defined by management. The contracts upon which historical results are based may differ from those which will be transferred upon the sale of Applications. Applications is an operating group of The Titan Corporation and allocation of administrative and corporate expenses have been included in the results of operations. The liability for these services is included in Titan Corporate Equity in Titan Applications Group. All other significant intergroup transactions and balances have been eliminated. Applications is an operating group of The Titan Corporation and is dependent on administrative support from The Titan Corporation. This presentation is not intended to and does not portray a stand-alone operating group. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: ------------------------------------------- Revenue Recognition - - ------------------- Applications' revenues are derived from products manufactured and services performed under cost-reimbursable contracts (70% of revenues for the nine month period ended October 1, 1993 and 53%, 65% and 91% for the years ended December 31, 1992, 1991, and 1990 , respectively), fixed-price contracts (29% of revenues for the nine month period ended December 31, 1992, 1991, and 1990, respectively) and time and materials contracts (1% for the nine month period ended October 1, 1993 and 0%, 3%, and 1% for the years ended December 31, 1992, 1991, and 1990, respectively). Revenues are generally recognized using the percentage-of- completion method. Estimated contract losses are fully charged to operations when identified by operating management. Property and Equipment - - ---------------------- Property and equipment are stated at cost. Depreciation is provided using the straight-line method, with estimated useful lives ranging from three to five years for office equipment and furniture and fixtures. 8 Income Taxes - - ------------ No provision for income taxes has been made in these statements as Applications is part of The Titan Corporation which has elected not to have a tax sharing allocation to its groups. 3. OTHER FINANCIAL DATA: --------------------- Unbilled Accounts Receivable - - ---------------------------- Unbilled accounts receivable represent work-in-process which will be billed in accordance with contract terms and delivery schedules. Also included in unbilled accounts receivable are amounts billable upon final execution of contracts, contract completion, milestones or completion of rate negotiations. Substantially all unbilled receivables at October 1, 1993 are expected to be collected within one year. Revenues have been recorded for performance on certain U.S. government contracts based on actual rates. These rates are subject to audit by the Defense Contract Audit Agency. Management does not anticipate any material variance from these rates upon final settlement. Amounts included in unbilled accounts receivable are as follows: Billable $2,757,391 Retentions 114,226 Milestones 88,733 Other 15,666 ---------- Total unbilled accounts receivable $2,976,016 ========== Accrued Liabilities - - ------------------- Amounts included in accrued liabilities are as follows: Accrued salaries $ 244,532 Accrued vacation 449,523 Accrued bonus 187,050 Other payroll liabilities 86,076 Other accrued liabilities 37,191 ---------- $1,004,372 ==========
Intracompany Transactions/Related Parties - - ----------------------------------------- The Titan Corporation has historically provided a substantial portion of the general and administrative services for Applications. General and administrative costs are allocated to Applications from the Titan Corporation. The general and administrative services provided by the Titan Corporation may not be available at the same rates upon sale of Applications. 9 Applications serves as the prime or the subcontractor on certain contracts with other divisions of The Titan Corporation. Fees on intracompany contracts were not material. These contracts may not be available or may not be available under similar terms in the future. Intracompany contract activity is as follows.
Nine-Month Period Ended Year Ended December 31, October 1, -------------------------------- 1993 1992 1991 1990 ---------- ---------- --------- -------- Subcontract work performed by Applications for other Titan Divisions $1,100,000 $559,000 $725,000 $58,000 ========== ======== ======== ======= Charges to Applications' prime contracts by other Titan Divisions $ 240,000 $646,000 $312,000 $51,000 ========== ======== ======== =======
4. COMMITMENTS AND CONTINGENCIES: ------------------------------ The Titan Corporation and Applications are subject to contract award protests, disputes and litigation in the normal course of business. In management's opinion, the resolution of existing protests, disputes and litigation will not result in any material impact on the reported results in the accompanying statements. Rental expense for the nine-months ending October 1, 1993, and the years ended December 31, 1992, 1991 and 1990, under operating lease arrangements, principally facilities leases, was $89,000, $101,000, $90,000 and $48,000, respectively. These leases generally include renewal options and require minimum payments as follows. These future minimum payments do not include immaterial costs for Titan Corporation space which Applications occupies. 1994 $185,880 1995 146,804 1996 142,308 1997 137,813 1998 114,843 Thereafter - -------- $727,648 ========
5. SUBSEQUENT EVENT ---------------- On March 5, 1994, the Company entered into an agreement to sell Applications for approximately $21 million, subject to certain post-closing adjustments. 10 TITAN APPLICATIONS GROUP CONDENSED STATEMENT OF CERTAIN SPECIFIED ASSETS AND LIABILITIES (UNAUDITED) March 31, 1994 (thousands of dollars) ASSETS Current assets: Cash and cash equivalents $ 78 Accounts receivable 7,062 Other current assets 376 ------ Total current assets 7,516 Property and equipment -- net 484 Other assets 12 ------ $8,012 ====== LIABILITIES AND CORPORATE EQUITY Accounts payable and other current liabilities $3,953 Titan corporate equity in Titan Applications Group 4,059 ------ $8,012 ======
11 TITAN APPLICATIONS GROUP CONDENSED STATEMENT OF OPERATING INCOME (UNAUDITED) Six months ended March 31, 1994 (thousands of dollars)
Revenues $21,459 Costs and expenses: Cost of revenues 17,955 Selling, general and administrative expenses 1,502 ------- 19,457 ------- Operating Income $ 2,002 =======
12 b. PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS The unaudited pro forma condensed combined balance sheet as of March 31, 1994 gives effect to the acquisition of the Titan Applications Group by Cubic Corporation as if the acquisition had occurred on March 31, 1994. The unaudited pro forma condensed combined statements of income for the year ended September 30, 1993 and six months ended March 31, 1994, give effect to the acquisition as if it had occurred on October 1, 1992. The proforma financial statements have been prepared utilizing the September 30, 1993 audited financial statements of Cubic Corporation, the October 1, 1993 audited financial statements of Titan Applications Group and the unaudited interim financial statements of both entities for the six month period ended March 31, 1994. The Statement of Operating Income of Titan Applications Group for the period October 1, 1993 through December 31, 1993 is included in both the pro forma statements of income for the year ended September 30, 1993 and the six months ended March 31, 1994. Sales and operating income for this three-month period amounted to $10,606,000 and $1,371,000 respectively. These pro forma financial statements may not be indicative of the results that actually would have occurred if the acquisition had taken place on the dates indicated or which may be obtained in the future. The pro forma financial statements should be read in conjunction with the notes thereto, and with the audited financial statements of Cubic Corporation and Titan Applications Group. 13 CUBIC CORPORATION AND TITAN APPLICATIONS GROUP PRO FORMA CONDENSED COMBINED BALANCE SHEET (UNAUDITED) March 31, 1994 (thousands of dollars)
Pro Forma Titan Adjustments Cubic Applications Increase Pro Forma Corporation Group (Decrease) Combined ----------- ------------- ------------- ---------- ASSETS Current assets: Cash and cash equivalents $ 38,323 $ 78 $(21,000)(a) $ 17,401 Marketable securities 11,376 11,376 Accounts receivable 102,044 7,062 109,106 Inventories 24,002 24,002 Other current assets 5,989 376 6,365 -------- ------- --------- --------- Total current assets 181,734 7,516 (21,000) 168,250 Property, plant and equipment -- net 27,992 484 28,476 Toll equipment under operating leases -- net 18,909 18,909 Preferred stock of U. S. Elevator Corp. 20,000 20,000 Cost in excess of net tangible assets of purchased businesses, less amortization 373 18,341 (a) 18,714 Net assets of discontinued operation 2,840 2,840 Other assets 15,253 12 15,265 -------- ------- --------- -------- $267,101 $ 8,012 $ (2,659) $272,454 ======== ======= ======== ========= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable and other current liabilities $ 64,838 $ 3,953 $ $ 68,791 Approximate amount payable to The Titan Corp. 1,400 (a) 1,400 Income taxes 572 572 -------- -------- -------- -------- Total current liabilities 65,410 3,953 1,400 70,763 Long-term debt 39,943 39,943 Deferred income taxes and other 3,797 3,797 Net tangible assets of Titan Applications Group 4,059 (4,059)(a) Shareholders' equity 157,951 157,951 -------- ------- -------- -------- $267,101 $ 8,012 $ (2,659) $272,454 ======== ======= ======== ========
See accompanying notes. 14 CUBIC CORPORATION AND TITAN APPLICATIONS GROUP PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME (UNAUDITED) Year ended September 30, 1993 (thousands of dollars)
Pro Forma Titan Adjustments Cubic Applications Increase Pro Forma Corporation Group (Decrease) Combined ----------- ------------- ----------- ---------- Revenues: Net sales $221,437 $32,069 $253,506 Other income 7,052 (600)(d) 6,452 -------- ------- ------ -------- 228,489 32,069 (600) 259,958 Costs and expenses: Cost of sales 178,491 26,895 205,386 Selling, general and administrative expenses 42,347 2,305 (850)(b) 45,002 1,200 (c) Research and development 3,597 3,597 Interest 2,294 2,294 -------- -------- -------- -------- 226,729 29,200 350 256,279 Income from continuing operations before income taxes 1,760 2,868 (950) 3,678 Income taxes (credit) (450) 750 (e) 300 -------- ------- ------- --------- Income from continuing operations 2,210 2,868 (1,700) 3,378 Discontinued operations, net of applicable income taxes 20,071 20,071 -------- -------- -------- -------- Net Income $ 22,281 $ 2,868 $ (1,700) $ 23,449 ======== ======= ======== ======== Average shares of common stock outstanding 6,095 6,095 ======== ======== Per share data: Income from continuing operations $ .36 $.55 Income from discontinued operations 3.30 3.30 -------- -------- Net income $ 3.66 $3.85 ======== ========
See accompanying notes. 15 CUBIC CORPORATION AND TITAN APPLICATIONS GROUP PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME (UNAUDITED) Six months ended March 31, 1994 (thousands of dollars)
Pro Forma Titan Adjustments Cubic Applications Increase Pro Forma Corporation Group (Decrease) Combined ----------- ------------ ----------- ---------- Revenues: Net sales $ 98,324 $21,459 $119,783 Other income 4,501 (300)(d) 4,201 -------- ------- ------ ------- 102,825 21,459 (300) 123,984 Costs and expenses: Cost of sales 76,404 17,955 94,359 Selling, general and administrative expenses 23,354 1,502 (500)(b) 24,956 600 (c) Research and development 1,460 1,460 Interest 1,221 1,221 -------- ------- ------- -------- 102,439 19,457 100 121,996 -------- ------- ------- -------- Income from continuing operations before income taxes 386 2,002 (400) 1,988 Income taxes 650 (e) 650 -------- ------- ------- -------- Income from continuing operations 386 2,002 (1,050) 1,338 Discontinued operation, net of applicable income taxes (153) (153) -------- ------- ------- -------- Income before cumulative effect of accounting change 233 2,002 (1,050) 1,185 Cumulative effect of accounting change 1,379 1,379 -------- ------- ------- -------- Net Income $ 1,612 $ 2,002 $(1,050) $ 2,564 ======== ======= ======= ======== Average shares of common stock outstanding 6,056 6,056 ======== ======== Per share data: Income from continuing operations $ .06 $.22 Loss from discontinued operation (.03) (.03) Cumulative effect of accounting change .23 .23 -------- -------- Net income $ .26 $.42 ======== ========
See accompanying notes. 16 CUBIC CORPORATION AND TITAN APPLICATIONS GROUP NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS (a) Purchase accounting adjustments necessary to reflect the acquisition are as follows (in thousands): Cash payment at acquisition $21,000 Approximate additional payment to be made at final settlement 1,400 Approximate net tangible assets of Titan Applications Group (4,059) ------- Cost in excess of net tangible assets of Titan Applications Group $18,341 =======
(b) Amount represents adjustment to eliminate approximate administrative expenses charged to Titan Applications Group by The Titan Corporation. No significant incremental administrative expense is anticipated to be incurred as a result of the acquisition. (c) Adjustment to reflect amortization of the cost of the net assets acquired in excess of their tangible value over a fifteen year period. (d) Adjustment to reflect the approximate interest income which would not have been earned, as a result of the cash used in the acquisition. (e) Adjustment for the approximate effect on income tax expense resulting from the operating income of Titan Applications Group and the adjustments in (b), (c) and (d) above. 17 EX-23.1 2 ACCT'S CONSENT EXHIBIT 23 -- CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the inclusion in this Form 8-K of our report dated November 17, 1993, (except for the matter included in Note 5, as to which the date is March 5, 1994) covering the financial position of Titan Applications Group as of October 1, 1993, and the statements of operating income for the nine-month period ended October 1, 1993 and for the years ended December 31, 1992, 1991 and 1990. /s/ Arthur Andersen & Co. San Diego, California June 21, 1994 -----END PRIVACY-ENHANCED MESSAGE-----