-----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, S6+aAasxn0ijLHZCDM70+hzFg/iptU7io3aaxgL2xePm1b6wqnAefB/mmQVWuZH8 PZe1q6hzw6DsoskfQM7Wmw== 0000027748-00-000003.txt : 20000329 0000027748-00-000003.hdr.sgml : 20000329 ACCESSION NUMBER: 0000027748-00-000003 CONFORMED SUBMISSION TYPE: 10-Q/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19991030 FILED AS OF DATE: 20000328 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DEL GLOBAL TECHNOLOGIES CORP CENTRAL INDEX KEY: 0000027748 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRONIC COMPONENTS, NEC [3679] IRS NUMBER: 131784308 STATE OF INCORPORATION: NY FISCAL YEAR END: 0731 FILING VALUES: FORM TYPE: 10-Q/A SEC ACT: SEC FILE NUMBER: 000-03319 FILM NUMBER: 581411 BUSINESS ADDRESS: STREET 1: 1 COMMERCE PARK CITY: VALHALLA STATE: NY ZIP: 10595 BUSINESS PHONE: 9146863600 MAIL ADDRESS: STREET 1: 1 COMMERCE PARK CITY: VALHALLA STATE: NY ZIP: 10595 FORMER COMPANY: FORMER CONFORMED NAME: DEL ELECTRONICS CORP DATE OF NAME CHANGE: 19920703 10-Q/A 1 DEL GLOBAL TECHNOLOGIES CORP. SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q/A QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended October 30, 1999 Commission File Number 0-3319 DEL GLOBAL TECHNOLOGIES CORP. ----------------------------- (Exact name of registrant as specified in its charter) New York 13-1784308 -------- ---------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) One Commerce Park, Valhalla, NY 10595 - ------------------------------- ----- (Address of principal executive offices) (Zip Code) (914) 686-3600 -------------- (Registrant's telephone number including area code) 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 close of the business on December 8,1999. Common Stock - 7,814,916 DEL GLOBAL TECHNOLOGIES CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) ASSETS October 30, July 31, 1999 1999 ----------- ----------- CURRENT ASSETS Cash and cash equivalents $ 626,113 $ 320,742 Investments available-for-sale 1,139,370 1,292,852 Trade receivables - net 14,912,641 15,624,433 Cost and estimated earnings in excess of billings on uncompleted contracts 7,759,094 6,402,532 Inventory 37,212,350 36,599,587 Prepaid expenses and other current assets 1,576,066 1,216,145 ----------- ----------- Total current assets 63,225,634 61,456,291 ----------- ----------- FIXED ASSETS - Net 14,975,212 14,668,060 INTANGIBLES - Net 834,191 879,898 GOODWILL - Net 5,164,082 5,236,965 DEFERRED CHARGES 231,873 264,464 OTHER ASSETS 1,613,763 1,598,279 ----------- ----------- TOTAL $86,044,755 $84,103,957 =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Current portion of long-term debt $ 784,467 $ 516,654 Accounts payable - trade 6,255,667 6,295,586 Accrued liabilities 4,556,690 4,468,521 Deferred compensation liability 1,209,321 1,201,065 Income taxes 1,114,894 1,224,451 ----------- ----------- Total current liabilities 13,921,039 13,706,277 ----------- ----------- LONG-TERM LIABILITIES LONG-TERM DEBT (less current portion included above) 2,078,832 1,832,287 OTHER 573,505 594,272 DEFERRED INCOME TAXES 1,778,442 1,620,417 ----------- ----------- Total liabilities 18,351,818 17,753,253 ----------- ----------- SHAREHOLDERS' EQUITY Common stock, $.10 par value; Authorized 20,000,000 shares; Issued and outstanding 8,354,316 shares at October 30, 1999 and 8,278,646 shares at July 31, 1999 835,433 827,866 Additional paid-in capital 51,058,863 50,798,502 Retained earnings 20,558,485 19,032,506 ----------- ----------- 72,452,781 70,658,874 Less common stock in treasury - 546,261 shares at October 30, 1999 and 490,393 shares at July 31, 1999 4,759,844 4,308,170 ----------- ----------- Total shareholders' equity 67,692,937 66,350,704 ----------- ----------- TOTAL $86,044,755 $84,103,957 =========== =========== See notes to consolidated financial statements -2- DEL GLOBAL TECHNOLOGIES CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Unaudited) Three Months Ended --------------------------- October 30, October 31, 1999 1998 ----------- ----------- NET SALES $15,712,024 $14,809,666 ----------- ----------- COSTS AND EXPENSES: Cost of sales 9,310,733 8,679,168 Research and development 1,543,154 1,431,314 Selling, general and administrative 2,603,174 2,621,162 Interest expense - net 62,037 ----------- ----------- 6,881 13,519,098 12,738,525 INCOME BEFORE PROVISION FOR INCOME TAXES 2,192,926 2,071,141 PROVISION FOR INCOME TAXES 666,948 642,054 ----------- ----------- NET INCOME $ 1,525,978 $ 1,429,087 =========== =========== NET INCOME PER COMMON SHARE AND COMMON SHARE EQUIVALENTS: BASIC $ .20 $ .19 =========== =========== DILUTED $ .19 $ .18 =========== =========== Weighted number of common shares outstanding 7,786,004 7,648,413 =========== =========== Weighted number of common shares and common share equivalents outstanding 8,171,777 8,142,557 =========== =========== See notes to consolidated financial statements -3- DEL GLOBAL TECHNOLOGIES CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Three Months Ended -------------------------- October 30, October 31, 1999 1998 ----------- ------------ CASH FLOWS FROM OPERATING ACTIVITIES: Net Income $ 1,525,978 $ 1,429,087 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 555,560 413,419 Amortization 187,462 157,944 Imputed interest 19,706 10,974 Deferred income tax provision 147,495 94,745 Tax benefit from exercise of stock options and warrants 188,849 18,019 Amortization of stock-based compensation 7,833 5,508 Changes in assets and liabilities: Decrease (increase) in trade receivables 711,792 (869,725) Increase in cost and estimated earnings in excess of billings on uncompleted contracts (1,356,562) (908,225) Increase in inventory (612,763) (2,072,986) Increase in prepaid and other current assets (396,202) (539,657) Increase in other assets (4,954) (6,776) (Decrease) increase in accounts payable - trade (39,919) 1,170,993 Increase in accrued liabilities 85,072 145,842 Increase in deferred compensation liability 8,256 69,902 (Decrease) increase in income taxes payable (109,557) 378,790 ----------- ----------- Net cash provided by (used in) operating activities 918,046 (502,146) ----------- ----------- CASH FLOWS FROM INVESTING ACTIVITIES: Expenditures for fixed assets (862,712) (692,266) Investment in marketable securities 153,482 (73,026) Payments to former shareholders of subsidiary acquired (17,707) (29,796) ----------- ----------- Net cash used in investing activities (726,937) (795,088) ----------- ----------- CASH FLOWS FROM FINANCING ACTIVITIES: Net proceeds from bank borrowing 514,358 498,737 Payment for repurchase of shares (451,674) (682,404) Proceeds from exercise of stock options and warrants 71,247 42,548 Other (19,669) (5,784) ----------- ----------- Net cash provided by (used in) financing activities 114,262 (146,903) ----------- ----------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 305,371 (1,444,137) CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 320,742 3,401,697 ----------- ----------- CASH AND CASH EQUIVALENTS, END OF PERIOD $ 626,113 $ 1,957,560 =========== =========== See notes to consolidated financial statements -4- DEL GLOBAL TECHNOLOGIES CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Three Months Ended -------------------------- October 30, October 31, 1999 1998 ----------- ------------ SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Interest paid $ 6,359 $ 33,724 =========== ========== Income taxes paid $ 482,440 $ 150,500 =========== ========== See notes to consolidated financial statements -5- DEL GLOBAL TECHNOLOGIES CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) NOTE 1 In the opinion of the Company's management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the results of the Company's financial position as of October 30, 1999 and the results of its operations and its cash flows for the three months ended October 30, 1999 and October 31, 1998. The accounting policies followed by the Company are set forth in Note 1 to the Company's financial statements as of July 31, 1999. The consolidated financial statements should be read in conjunction with the notes to the financial statements as of July 31, 1999. Certain reclassifications have been made in the prior period's financial statements to correspond to the current period's presentation. NOTE 2 The results of operations for the three-month period ended October 30, 1999 are not necessarily indicative of the results to be expected for the full year. NOTE 3 INVESTMENTS Investments available-for-sale at October 30, 1999 and July 31, 1999 include $1,209,321and $1,201,065, respectively, for the Company's President's deferred compensation and certain key executives. At October 30, 1999 and July 31, 1999, $118,514 and $213,411, respectively, were classified as cash and $1,090,808 and $987,654, respectively, were recorded as investments. The liabilities of $1,209,321 and $1,201,065, respectively, are recorded as deferred compensation liability. Gains and losses on the investments held to fund the deferred compensation, either recognized or unrealized, inure to the benefit or detriment of the President's or key executives' deferred compensation. At October 30, 1999, the balance of investments available-for-sale of $48,562 are equity securities held by the Company for its own account. Realized and unrealized gains and losses on these securities for the period ended October 30, 1999 were not material and are recorded in the financial statements. NOTE 4 PERCENTAGE OF COMPLETION ACCOUNTING October 30, July 31, 1999 1999 ----------- ----------- Costs incurred on uncompleted contracts $15,206,728 $15,012,158 Estimated earnings 9,906,018 9,329,220 ----------- ----------- 25,112,746 24,341,378 Less billings to date 17,353,652 17,938,846 ----------- ----------- Costs and estimated earnings in excess of billings on uncompleted contracts $ 7,759,094 $ 6,402,532 =========== =========== The backlog of unshipped contracts being accounted for under the percentage of completion method of accounting was approximately $4.7 million at October 30, 1999. -6- NOTE 5 INVENTORY Inventory is stated at the lower of cost (first-in, first-out) or market. Inventories and their effect on cost of sales are determined by physical count for annual reporting purposes and are estimated by management for interim reporting purposes. Inventory consists of the following: October 30, July 31, 1999 1999 ----------- ----------- Finished goods $ 7,820,260 $ 5,414,095 Work-in-process 17,246,575 14,814,766 Raw material and purchased parts 12,145,515 16,370,726 ----------- ----------- Total $37,212,350 $36,599,587 =========== =========== NOTE 6 FIXED ASSETS Fixed assets consist of the following: October 30, July 31, 1999 1999 ----------- ----------- Land $ 694,046 $ 694,046 Building 2,178,025 2,161,025 Machinery and equipment 16,520,067 15,967,619 Furniture and fixtures 2,021,237 1,914,396 Leasehold improvements 2,367,296 2,180,873 Transportation equipment 30,103 30,103 ----------- ----------- 23,810,774 22,948,062 Less accumulated depreciation and amortization 8,835,562 8,280,002 ----------- ----------- Net fixed assets $14,975,212 $14,668,060 =========== =========== NOTE 7 SEGMENTS The Company adopted SFAS No. 131, "Disclosures about Segments of an Enterprise and Related Information", during the fourth quarter of the year ended July 31, 1999. SFAS No. 131 establishes standards for reporting information about operating segments in annual financial statements and requires selected information about operating segments in interim financial statements. It also establishes standards for related disclosures about products and services, major customers and geographic areas. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief decision maker, or decision making group, in deciding how to allocate resources and in assessing performance. The Company's chief operating decision making group is comprised of the Chief Executive Officer and the senior executives of the Company's operating segments. The Company has two reportable segments which are Medical Imaging Systems and Critical Electronic Subsystems. The Medical Imaging Systems Segment designs, manufactures and markets state-of-the-art, cost-effective medical imaging and diagnostic systems consisting of stationary and portable imaging systems, radiographic/fluoroscopic systems, mammography systems and a neo-natal imaging system. The Critical Electronic Subsystems Segment designs, manufactures and markets proprietary precision power conversion and noise suppression subsystems for medical as well as critical industrial applications. Selected financial data of these segments is as follows: -7-
Medical Critical Imaging Electronic Systems Subsystems Total ------------ ----------- ----------- For the Three Months Ended October 30, 1999: Net sales to external customers $ 7,883,898 $ 7,828,126 $15,712,024 ============ =========== =========== Income before provision for income taxes $ 614,991 $ 1,577,935 $ 2,192,926 ============ =========== =========== Segment assets $ 38,919,996 $47,124,759 $86,044,755 ============ =========== ===========
Medical Critical Imaging Electronic Systems Subsystems Total ------------ ----------- ----------- For the Three Months Ended October 31, 1998: Net sales to external customers $ 7,345,710 $ 7,463,956 $14,809,666 ============ =========== =========== Income before provision for income taxes $ 611,836 $ 1,459,305 $ 2,071,141 ============ =========== =========== Segment assets $ 31,156,009 $44,347,779 $75,503,788 ============ =========== ===========
-8- SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. DEL GLOBAL TECHNOLOGIES CORP. /S/LEONARD A. TRUGMAN --------------------- Leonard A. Trugman Chairman of the Board, Chief Executive Officer and President /S/MICHAEL H. TABER --------------------- Michael H. Taber Chief Financial Officer, Vice President of Finance and Secretary Dated: March 28, 2000 -13- -----END PRIVACY-ENHANCED MESSAGE-----