-----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, TXyIm0NWJln2ngydMo5bCgX3xpXAtl6aI5Hgfm0UKgazxbl9hRfJ4Ck3/Fg2tEmg PE5yfQGGBHhL+W/BHieuHw== 0000276747-97-000010.txt : 19971118 0000276747-97-000010.hdr.sgml : 19971118 ACCESSION NUMBER: 0000276747-97-000010 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970930 FILED AS OF DATE: 19971117 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: ROBINSON NUGENT INC CENTRAL INDEX KEY: 0000276747 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRONIC CONNECTORS [3678] IRS NUMBER: 350957603 STATE OF INCORPORATION: IN FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-09010 FILM NUMBER: 97722313 BUSINESS ADDRESS: STREET 1: 800 E EIGHTH ST STREET 2: PO BOX 1208 CITY: NEW ALBANY STATE: IN ZIP: 47151-1208 BUSINESS PHONE: 8129450211 MAIL ADDRESS: STREET 1: PO BOX 1208 STREET 2: 800 E EIGHTH ST CITY: NEW ALBANY STATE: IN ZIP: 47151-1208 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1997 -------------------------------------- OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ----------------- ---------------- Commission File Number 0-9010 ------------------------------------------------- ROBINSON NUGENT, INC. - ---------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) INDIANA 35-0957603 - ---------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 800 East Eighth Street, New Albany, Indiana 47151-1208 - ---------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (812) 945-0211 ---------------------- 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 ----- ----- Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practical date: As of October 31, 1997, the registrant had outstanding 4,891,765 common shares without par value. The Index to Exhibits is located at page 13 in the sequential numbering system. Total pages: 14. ROBINSON NUGENT, INC. AND SUBSIDIARIES INDEX Page No. - -------- PART I. Financial Information: Item 1. Financial Statements Consolidated balance sheets at September 30, 1997, September 30, 1996 and June 30, 1997 ...........3 Consolidated statements of operations for the three months ended September 30, 1997 and September 30, 1996 ...........5 Consolidated statements of cash flows for the three months ended September 30, 1997 and September 30,1996 .......... 6 Notes to consolidated financial statements ...........7 Item 2. Management's discussion and analysis of financial condition and results of operations ...........8 PART II. Other Information .......... 11 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS ROBINSON NUGENT, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (IN THOUSANDS)
September 30 June 30 ---------------------- ASSETS 1997 1996 1997 ------- ------- ------- (Unaudited) Current assets: Cash and cash equivalents $ 3,262 $ 1,338 $ 4,118 Accounts receivable, net 11,006 11,542 11,784 Inventories: Raw materials 1,183 1,406 1,294 Work in process 6,729 6,554 5,933 Finished goods 3,716 4,886 3,873 ------- ------- ------- Total inventories 11,629 12,846 11,100 Other current assets 1,538 1,649 1,371 ------- ------- ------- Total current assets 27,435 27,375 28,373 Property, plant & equip- ment, net 21,188 23,116 21,188 Other assets 147 68 135 ------- ------- ------- Total assets $48,770 $50,559 $49,696 ======= ======= =======
See accompanying notes to the consolidated financial statements. PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS (CONTINUED) ROBINSON NUGENT, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT SHARE DATA)
September 30 June 30 -------------------- ------- LIABILITIES AND SHAREHOLDERS' EQUITY 1997 1996 1997 ------- ------- ------- (Unaudited) Current liabilities: Current installments of long- term debt $ 376 $ 466 $ 386 Short-term bank borrowings -- 6,400 -- Accounts payable 4,888 4,339 4,265 Accrued expenses 4,603 4,184 5,560 Income taxes 953 960 1,581 ------- ------- ------- Total current liabilities 10,820 16,349 11,792 Long-term debt, excluding current installments 6,845 2,965 5,926 Deferred income taxes 830 1,010 838 ------- ------- ------- Total liabilities 18,495 20,324 18,556 ------- ------- ------- Shareholders' equity: Common shares without par value Authorized shares 15,000,000; issued 6,851,250 shares 20,950 20,950 20,950 Retained earnings 21,011 19,776 21,290 Equity adjustment from foreign currency translation 1,471 2,775 2,073 Employee stock purchase plan loans and deferred compensation (161) (270) (177) Less 1,959,485 treasury shares (12,996) (12,996) (12,996) ------- ------- ------- Total shareholders' equity 30,275 30,235 31,140 ------- ------- ------- Total liabilities and shareholders' equity $48,770 $50,559 $49,696 ======= ======= =======
See accompanying notes to the consolidated financial statements. PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS (CONTINUED) ROBINSON NUGENT, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended September 30 -------------------- 1997 1996 ------- ------- (Unaudited) Net sales $18,543 $21,123 Cost of sales 15,157 16,396 ------ ------- Gross profit 3,386 4,727 Selling, general and administrative expenses 3,650 3,753 ------- ------- Operating income (loss) (264) 974 ------- ------- Other income (expense): Interest income 31 30 Interest expense (134) (187) Royalty income 1 30 Currency gain 156 19 ------- ------- 54 (108) ------- ------- Income (loss) before income taxes (210) 866 Income taxes (benefit) (78) 464 ------- ------- Net income (loss) $ (132) $ 402 ======= ======= Net income (loss) per common share $ (.03) $ .08 ======= ======= Dividends per common share $ .03 $ .03 ======= =======
See accompanying notes to the consolidated financial statements. PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS (CONTINUED) ROBINSON NUGENT, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS)
Three Months Ended September 30 -------------------- 1997 1996 ------- ------- (Unaudited) Cash flows from operating activities: Net income (loss) $ (132) $ 402 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 1,466 1,269 Losses from disposition of capital assets 2 58 (Increase) decrease in accounts receivable 778 (1,109) (Increase) decrease in inventories (529) 600 Increase in other current assets (169) (101) Decrease in accounts payable and accrued expenses (334) (1,726) Increase (decrease) in income taxes (634) 854 ------- ------- Net cash provided by operating activities 448 247 ------- ------- Cash flows from investing activities: Capital expenditures (1,881) (870) (Increase) decrease in other assets (29) 1 ------- ------- Net cash used in investing activities (1,910) (869) ------- ------- Cash flows from financing activities: Proceeds from long-term debt 1,000 -- Repayments of long-term debt (37) (290) Cash dividends paid (147) (147) Repayments of employee stock purchase plan loans 14 51 ------- ------- Net cash provided by (used in) financing activities 830 (386) ------- ------- Effect of exchange rate changes on cash (224) (22) ------- ------- Decrease in cash and cash equivalents (856) (1,030) Cash and cash equivalents at beginning of period 4,118 2,368 ------- ------- Cash and cash equivalents at end of period $ 3,262 $ 1,338 ======= =======
See accompanying notes to the consolidated financial statements. PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS (CONTINUED) ROBINSON NUGENT, INC. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) SEPTEMBER 30, 1997 AND 1996, AND JUNE 30, 1997 1. In the opinion of management, the accompanying unaudited consolidated condensed financial statements contain all adjustments necessary (all of which are normal and recurring) to present fairly the financial position of the Company and its subsidiaries, results of operations, and cash flows in conformity with generally accepted accounting principles. 2. Earnings per common share for the period ending September 30, 1997 are based only upon the weighted-average number of shares outstanding during the period of 4,891,765 shares. Earnings per common share for the period ending September 30, 1996 are based upon the weighted-average number of shares outstanding during the period, plus common share equivalents resulting from dilutive stock options of 4,911,215 shares. In February of 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 128, "Earnings Per Share." The Company adopted this new standard in fiscal 1998, and it shall become effective in the quarterly report for the period ending December 31, 1997. This statement changes the required methods used to calculate earnings per share data, harmonizing U.S. GAAP requirements with that of International Accounting Standards No. 33. The major change from the previous calculation is the disclosure of basic EPS, which is computed by dividing reported earnings by the weighted-average common shares outstanding (without any adjustments for common stock equivalents), versus the current primary EPS calculation required by the superseded APB Opinion No. 15. Fully diluted EPS, now called diluted EPS, is still required, with the average arket price of common stock used to determine common stock equivalents rather than the greater of the average market price or period ending closing price. The Company does not expect that the adoption of this standard will have a material impact on its financial statements. 3. Reference is directed to the Company's consolidated financial statements (Form 10-K), including references to the Annual Report, for the year ended June 30,1997 and management's discussion and analysis included in Part I, Item 2 in this report. PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Results of Operations - --------------------- Net sales for the quarter ended September 30, 1997 were $18,543,000, down 12 percent from sales of $21,123,000 in the same period a year ago. Lower customer sales in the United States and Europe, were partially offset by an increase in customer sales in Asia. Customer sales in the United States were 18% lower than the prior period due primarily to lower sales of cable assemblies and high density sockets. European sales of connectors were $404,000 lower than the prior period when measured in local currencies, while changes in currency exchange rates reduced European sales by approximately $300,000. Customer sales in Asia were $671,000 or 46% higher than the prior period due primarily to higher connector sales in Southeast Asia and Japan. Comparative sales by geographic territory for the respective periods follows:
Three Months Ended ($000 omitted) September 30 -------------------- 1997 1996 -------- -------- United States: Domestic $11,372 $13,388 Export: Europe 21 12 Asia 7 134 Rest of world 356 769 ------- ------- Total export sales 384 915 ------- ------- Total sales to customers 11,756 14,303 Intercompany 2,238 2,059 ------- ------- Total United States 13,994 16,362 ------- ------- Europe: Domestic 4,672 4,989 Export to Asia -- 387 ------- ------- Total sales to customers 4,672 5,376 ------- ------- Intercompany 1,081 981 ------- ------- Total Europe 5,753 6,357 ------- ------- Asia: Domestic 2,115 1,349 Rest of world -- 95 ------- ------- Total sales to customers 2,115 1,444 Intercompany 847 644 ------- ------- Total Asia 2,962 2,088 ------- ------- Eliminations (4,166) (3,684) ------- ------- Consolidated $18,543 $21,123 ======= =======
Incoming customer orders for the quarter ended September 30, 1997 amounted to $18.1 million, down 13% from orders of $20.9 million in the same quarter a year ago. The Company ended the quarter with a backlog of unshipped orders of $14.1 million compared to $15.7 million a year ago. Gross profits in the quarter ended September 30, 1997 amounted to $3,386,000 or 18.3 percent of net sales, compared to $4,727,000 or 22.4 percent of net sales in the prior year. Gross profits are net of engineering charges associated with new product development, which amounted to $987,000 or 5.3 percent of net sales in the current quarter compared to $773,000 or 3.7 percent of net sales in the prior year. The reduction in gross profits in the quarter compared to the prior year reflects lower sales, continued competitive price pressures worldwide, unfavorable plant utilization as a result of the lower sales volumes, and an unfavorable product mix. Gross profits were favorably impacted by the effect of manufacturing cost reduction programs. Selling, general and administrative expenses of $3,650,000 for the three months ended September 30, 1997 decreased 3% compared to expenses of $3,753,000 in the prior year. Lower compensation expense in the United States, coupled with lower sales and marketing expenses in Europe, were partially offset by higher administrative expenses in Asia. Other income and expense for the three months ended September 30, 1997 reflected other income of $54,000 compared to other expense of $108,000 for the comparable three-month period in the prior year. The improvement in other income and expense reflected an increase in currency gains in the current quarter combined with lower interest expense. Interest expense decreased from $187,000 in the prior period to $134,000 in the current period due primarily to a decrease in short term and long term debt. Currency gains in the quarter totaled $156,000 compared to $19,000 in the prior period. These currency gains were generated overseas, primarily in Malaysia, Japan and Europe. The gains in Malaysia were a direct result of stronger US dollar currency exchange rates in that region. The provision for income taxes was provided using the appropriate effective tax rates for each of the tax jurisdictions in which the Company operates. A pretax loss was reported in the United States, Scotland, Singapore and Japan. These losses were partially offset by taxable income in Switzerland, Belgium, the Netherlands and Malaysia. An income tax benefit was recorded related to the pretax loss in the United States. This tax benefit was partially offset by income tax expenses accrued by the Company's European operations. The income tax expense on pretax profits generated in Malaysia was offset by the tax benefit of the utilization of net operating loss carry- forwards from prior periods. At September 30, 1997, certain foreign subsidiaries have accumulated net operating loss carryforwards of approximately $2.9 million. Management is unable at this time to project future taxable income which will utilize these loss carryforwards. The tax benefit of these carryforwards will be recognized when management is able to project future taxable income of these foreign subsidiaries. The net loss in the quarter ended September 30, 1997 amounted to $132,000 or 3 cents per share, compared to a net income of $402,000 or 8 cents per share, in the prior period. The net loss in the United States was $227,000 compared to net incomes of $83,000 in Asia and $12,000 in Europe. Management anticipates higher sales levels and a return to profitability as the year progresses. This improved performance will result from a return to higher revenue levels, and will be augmented by reductions in manufacturing costs and operating expenses implemented in first quarter of the year. Financial Condition and Liquidity - --------------------------------- Working capital at September 30, 1997 amounted to $16.6 million compared to $11.0 million at September 30, 1996 and $16.6 million at June 30, 1997. The current ratio was 2.5 to 1 at September 30, 1997 compared to 1.7 to 1 at September 30, 1996. The increase in working capital, compared to the prior year, primarily reflects a reduction in short-term bank borrowings. In February, 1997 the Company replaced its existing short-term line of credit agreement with a new long-term credit facility. Long term borrowings under this facility were $5.0 million as of September 30, 1997. There were no significant changes in long-term debt in the quarter ended September 30, 1997. Long-term debt excluding current installments, represented $6.8 million, or 3 percent of shareholders' equity at September 30, 1997, compared to $3.0 million or 10 percent of shareholders' equity at September 30, 1996. Cash and cash equivalent balances decreased by $0.9 million during the current period. A portion of the Company's cash on hand, as well as cash generated by operations, and $1.0 million from proceeds from the long-term credit facility was invested in $1.9 million for capital expenditures during the period. These investments included approximately $1.0 million in plant improvements in the Company's facility in Dallas, Texas, investments in several new product programs and in the development of the Company's new management information system. The Company believes future working capital and capital expenditure require- ments can be met from cash provided by operating activities, existing cash balances, and borrowings available under the existing credit facility. Dividend Action - --------------------------- On July 31, 1997 the Board of Directors declared a regular quarterly dividend of 3 cents per share, payable August 28, 1997 to shareholders of record August 14, 1997. Cautionary Statements for Purposes of the Safe Harbor - ---------------------------------------------------------------------------- In addition to statements of historical fact, this quarterly report contains forward-looking statements which are inherently subject to change, based on known and unknown risks, including but not limited to changes in the market and industry. Please refer to documents filed with the Securities and Exchange Commission for additional information on factors that could materially affect the Company's financial results. PART II. OTHER INFORMATION Item 1. Not applicable. Item 2. Not applicable. Item 3. Not applicable. Item 4. Not applicable. Item 5. Not applicable. Item 6. Exhibits and Reports on Form 8-K. (a) See Index to Exhibits. (b) The Company filed an amended Form 8-K/A report on October 3, 1997 relating to a change in the Company's certifying accountant. 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. ROBINSON NUGENT, INC. -------------------------------------- (Registrant) Date /s/ Larry W. Burke ----------------------- ------------------------------------ Larry W. Burke President and Chief Executive Officer Date /s/ Robert L. Knabel ----------------------- ------------------------------------ Robert L. Knabel Vice President, Treasurer and Chief Financial Officer FORM 10-Q INDEX TO EXHIBITS Number of Sequential Item Numbering Assigned in System Regulation S-K Page Number Item 601 Description of Exhibit of Exhibit - -------------- ------------------------------------- ------------ (2) Not applicable. (4) 4.1 Specimen certificate for Common Shares, without par value. (Incorporated by reference to Exhibit 4 to Form S-1 Registration Statement No. 2-62521.) 4.2 Rights Agreement dated April 21, 1988 between Robinson Nugent, Inc. and Bank One, Indianapolis, N.A. (Incorporated by reference to Exhibit I to Form 8-A Registration Statement dated May 2, 1988.) 4.3 Amendment No. 1 to Rights Agreement dated September 26, 1991 between Robinson Nugent, Inc. and Bank One, Indianapolis, N.A. (Incorporated by reference to Exhibit 4.3 to Form 10-K Report for year ended June 30, 1991.) 4.4 Amendment No. 2 to Rights Agreement dated June 11, 1992. (Incorporated by reference to Exhibit 4.4 to Form 8-K Current Report dated July 6, 1992.) (10) 10.1 Robinson Nugent, Inc. 1983 Tax-Qualified Incentive Stock Option Plan. (Incorporated by reference to Exhibit 10.1 to Form 10-K Report for year ended June 30, 1983.) 10.2 Robinson Nugent, Inc. 1983 Non Tax- Qualified Incentive Stock Option Plan. (Incorporated by reference to Exhibit 10.2 to Form 10-K Report for year ended June 30, 1983.) 10.3 1993 Robinson Nugent, Inc. Employee and Non-Employee Director Stock Option Plan. (Incorporated by reference to Exhibit 19.1 to Form 10-K Report for year ended June 30, 1993.) 10.4 Summary of the Robinson Nugent, Inc. Employee Stock Purchase Plan (Incorporated by reference to Exhibit 19.2 to Form 10-K Report for year ended June 30, 1993.) 10.5 Deferred compensation agreement dated May 10, 1990 between Robinson Nugent, Inc. and Larry W. Burke, President and Chief Executive Officer. (Incorporated by reference to Exhibit 19.1 to Form 10-K Report for year ended June 30, 1990.) 10.6 Rabbi Trust Agreement dated July 1, 1996 between Robinson Nugent, Inc. and Dean Witter Trust Company, related to the deferred compensation agreement between Robinson Nugent, Inc. and Larry W. Burke President and Chief Executive Officer. (Incorporated by reference to Exhibit 10.6 to Form 10-K Report for year ended June 30, 1997.) 10.7 Summary of Robinson Nugent, Inc. Bonus Plan for the fiscal year ended June 30, 1998. (Incorporated by reference to Exhibit 10.7 to Form 10-K Report for year ended June 30, 1997.) (11) Not applicable. (15) Not applicable. (18) Not applicable. (19) Not applicable. (22) Not applicable. (23) Not applicable. (24) Not applicable. (27) Financial Data Schedule (99) Not applicable. EX-27 2
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE ROBINSON NUGENT, INC. 10-Q FOR THE PERIOD ENDING SEPTEMBER 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 3-MOS JUN-30-1998 JUL-01-1997 SEP-30-1997 3,262 0 11,578 572 11,629 27,435 60,980 39,792 48,770 10,820 0 20,950 0 0 9,325 48,770 18,543 18,543 15,157 15,157 3,650 0 134 (210) (78) (132) 0 0 0 (132) (.03) (.03)
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