-----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, WEWaHSmV9xJUmxrVQesN30HfrhCQXPVl/DOi+a3OkpJA9TKMm2vbRMNxMTSA/IXQ kEQRHVGO8E6o2Y9bzqnMuA== 0001009191-01-500006.txt : 20010213 0001009191-01-500006.hdr.sgml : 20010213 ACCESSION NUMBER: 0001009191-01-500006 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20001231 FILED AS OF DATE: 20010212 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DYNASIL CORP OF AMERICA CENTRAL INDEX KEY: 0000030831 STANDARD INDUSTRIAL CLASSIFICATION: GLASS, GLASSWARE, PRESSED OR BLOWN [3220] IRS NUMBER: 221734088 STATE OF INCORPORATION: NJ FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-27503 FILM NUMBER: 1532634 BUSINESS ADDRESS: STREET 1: 385 COOPER RD CITY: WEST BERLIN STATE: NJ ZIP: 08009 BUSINESS PHONE: 8567674600 MAIL ADDRESS: STREET 1: 385 COOPER RD CITY: WEST BERLIN STATE: NJ ZIP: 08091 10QSB 1 dyn10q.txt FORM 10-QSB UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-QSB (Mark One) XX QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE - --- ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2000 TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE - --- ACT OF 1934 FOR THE TRANSITION PERIOD FROM _______ TO ______. Commission file number 000-27503 ____________________ DYNASIL CORPORATION OF AMERICA ------------------------------------------------------------------- (Exact name of small business issuer as specified in its charter) New Jersey 22-1734088 -------------- ------------------------------- (State or other jurisdiction (IRS Employer Identification No.) of incorporation) 385 Cooper Road, West Berlin, New Jersey, 08091 ---------------------------------------------------------- (Address of principal executive offices) (856) 767-4600 -------------------------------------------------- (Registrant's telephone number, including area code) Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 XX No ---- ---- The Company had 2,372,377 shares of common stock, par value $.0005 per share, outstanding as of January 31, 2001. 1 DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES INDEX PAGE PART 1. FINANCIAL INFORMATION ---- ITEM 1. FINANCIAL STATEMENTS DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES ----------------------------------------------- CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 2000 AND SEPTEMBER 30, 2000 1 CONSOLIDATED STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED DECEMBER 31, 2000 AND 1999 2 CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED DECEMBER 31, 2000 AND 1999 3 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 4 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS 7 PART II. OTHER INFORMATION 11 ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K 11 SIGNATURES 12 2 DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET PAGE 1 (UNAUDITED) ASSETS December 31 September 30 2000 2000 ---------- ---------- Current assets Cash and cash equivalents $ 446,312 $ 249,695 Accounts receivable 705,212 608,488 Inventory 865,847 909,223 Other current assets 28,220 32,596 ---------- ---------- Total current assets 2,045,591 1,800,022 Property, Plant and Equipment, net 1,763,469 1,838,599 Other Assets 19,682 20,534 ---------- ---------- Total Assets $3,828,742 $3,659,135 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Current portion - long-term debt $482,600 $147,859 Accounts payable 164,409 101,871 Accrued expenses 151,475 165,751 ---------- ---------- Total current liabilities 798,484 415,481 Long-term Debt, net 1,245,565 1,620,885 Stockholders' Equity Common Stock, $.0005 par value, 25,000,000 shares authorized, 2,997,390 and 2,997,292 shares issued 2,356,766 and 2,356,668 shares outstanding 1,499 1,499 Additional paid in capital 1,062,439 1,062,309 Retained earnings 1,680,058 1,518,264 ---------- ---------- 2,743,996 2,582,072 Less 640,624 shares in treasury - at cost (959,303) (959,303) ---------- ---------- Total stockholders' equity 1,784,693 1,622,769 ---------- ---------- Total Liabilities and Stockholders' Equity $3,828,742 $3,659,135 ========== ==========
3 DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES CONSOLIDATED STATEMENT OF OPERATIONS PAGE 2 (UNAUDITED) Three Months Ended December 31 2000 1999 -------- --------- Sales $1,317,617 $ 765,419 Cost of Sales 918,535 553,103 -------- -------- Gross profit 399,082 212,316 Selling, general and administrative 192,974 150,245 -------- -------- Income from Operations 206,108 62,071 Other income (expense) Interest expense ( 47,027) ( 46,336) Other Income (Expense) 2,712 0 -------- -------- Income before Income Taxes 161,793 15,735 Provision (benefit) for Income Tax 0 0 -------- -------- Net income 161,793 15,735 ======== ======== Net income (loss) per share Basic $ 0.07 $ 0.01 Diluted $ 0.07 $ 0.01 Weighted average shares outstanding 2,356,738 2,346,579
4 DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS PAGE 3 (UNAUDITED) Three Months Ended December 31 2000 1999 ---------- ----------- Cash flows from operating activities: Net income $ 161,793 $ 15,735 Adjustments to reconcile net income (loss) to net cash used in operating activities: Depreciation 83,745 88,335 Amortization expense 852 852 Allowance for doubtful accounts (Increase) decrease in: Accounts receivable ( 96,724) (71,030) Inventories 43,376 (31,314) Prepaid expenses and other current assets 4,376 9,310 Other assets ( 2,778) Increase (decrease) in: Accounts payable 62,538 6,761 Accrued expenses (14,277) (79,127) --------- ----------- Net cash provided by (used in) operating activities 245,679 (63,256) --------- ----------- Cash flows from investing activities: Acquisition of property, plant and equipment ( 8,615) (14,647) --------- ----------- Net cash provided by (used in) investing activities ( 8,615) (14,647) --------- ----------- Cash flows from financing activities: Issuance of common stock 132 2,100 Repayments of long-term debt ( 40,579) ( 39,945) --------- ----------- Net cash provided by (used in) financing activities ( 40,447) (37,845) --------- ----------- Net increase (decrease) in cash 196,617 (115,748) Cash - beginning of period 249,695 140,253 --------- ----------- Cash - end of period $ 446,312 $ 24,505 ========= ===========
5 DYNASIL CORPORATION OF AMERICA NOTES TO CONSOLIDATED FINANCIAL STATEMENTS PAGE 4 (UNAUDITED) 1. Basis of Presentation The consolidated balance sheet as of September 30, 2000 was audited and appears in the Form 10-KSB previously filed by the Company. The consolidated balance sheet as of December 31, 2000 and the consolidated statements of operations and cash flows for the three months ended December 31, 2000 and 1999, and the related information contained in these notes have been prepared by management without audit. In the opinion of management, all adjustments (which include only normal recurring items) necessary to present fairly the financial position, results of operations and cash flows in conformity with generally accepted accounting principles as of December 31, 2000 and for all periods presented have been made. Interim operating results are not necessarily indicative of operating results for a full year. Certain information and note disclosures normally included in the Company's annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these condensed consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company's September 30, 2000 Annual Report on Form 10-KSB previously filed by the Company. 2. Inventories Inventories are stated at the lower of average cost or market. Cost is determined using the first-in, first-out (FIFO) method. Inventories consist primarily of raw materials, work-in-process and finished goods. The Company evaluates inventory levels and expected usage on a periodic basis and records adjustments for impairments as required. Inventories consisted of the following: December 31, 2000 September 30, 2000 ----------------- ------------------ Raw Materials 34,038 22,887 Work-in-Process 691,264 747,802 Finished Goods 140,545 138,534 ------- ------- 865,847 909,223 ======= ======= 3. Net Income Per Share Basic net income per share is computed using the weighted average number of common shares outstanding. The dilutive effects of potential common shares outstanding are included in diluted net earnings per share. Diluted net earnings per share exclude the impact of potential common shares since they would have resulted in an antidilutive effect. 6 ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OR PLAN OF OPERATION Results of Operations Sales were $1,317,617 for the three months ended December 31, 2000, an increase of 72% over sales of $765,419, for the three months ended December 31, 1999. The increase in sales is a result of the continued strong demand of our traditional optics market, the rapidly increasing uses of synthetic fused silica in the electro-optical markets, our ability to deliver Excimer glass in quantity and the increased demand in the international market. Cost of sales were $918,535, or 69.7% of sales, for the three months ended December 31,2000 and $553,103, or 72.3% of sales, for the three months ended December 31, 1999. The improvement of 2.6% from fiscal 1999 to fiscal 2000 is a result of the higher sales volumes absorbing a greater portion of our fixed costs and the continued emphasis by management to closely monitor our operating cost. Shop manpower increased by only 1.5 (includes 1 part timer to full time status). Gross profit increased to $399,082, or 30.3% of sales, for the three months ended December 31, 2000. This is an increase of $186,766, or 88%, over the $212,316 gross profit for the three months ended December 31, 1999. As discussed above increased sales and controlling expenses contributed to the substantial improvement. Selling, general and administrative expenses increased to $192,974, or 14.6% of sales, for the three months ended December 31, 2000. For the same period of fiscal year 1999 expenses were $150,245, or 19.6% of sales. The increase of $42,729 is related in part to increased sales, as $25,790 of the increase is commissions or bonus related to sales. Other major components of the increased selling, general and administrative expenses for the three months ended December 31,2000 were the increase in sales expenses related to attendance at a trade show and an increase in professional fees, related to completion of reporting requirements. Interest expense increased slightly to $47,027 for the three months ended December 31, 2000, from $46,336 for the three months ended December 31, 1999. The increase in other income of $2,712 represents interest income earned for the three months ended December 31, 2000. Net income increased to $161,793, or 12.3% of sales, for the three months ended December 31, 2000, from $15,735, or 2.0% of sales, for the three months ended December 31, 1999. Basic earnings per share for the three-month period ended December 31, 2000 showed an increase to $0.07 from $0.01 from the three-month period ended December 31, 2000. 7 The Company has no provision for income taxes for either period in 2000 or 1999. As of September 30, 2000, we have approximately $790,000 of net operating loss carryforwards to offset future income for federal tax purposes expiring in various years through 2019. In addition, the Company has approximately $214,000 of net operating loss carryforwards to offset certain future states' taxable income, expiring in various years through 2007. Liquidity and Capital Resources Cash increased by $196,617 for the three months ended December 31,2000. Cash provided from operations of $245,679 was primarily used to reduce debt by $40,579 and acquire property plant and equipment for $8,615. The Company believes that its current cash and cash equivalent balances, and net cash generated by operations, will be sufficient to meet its anticipated cash needs for working capital for at least the next 12 months. The Company will need approximately $125,000 for capital expenditures in the next nine months. This cash will come from internally generated funds. Any business expansion will require the Company to seek additional debt or equity financing. Forward-Looking Statements The statements contained in this Quarterly Report on Form 10-QSB which are not historical facts, including, but not limited to, certain statements found under the captions "Results of Operations" and "Liquidity and Capital Resources" above, are forward-looking statements that involve a number of risks and uncertainties. The actual results of the future events described in such forward-looking statements could differ materially from those stated in such forward-looking statements. Among the factors that could cause actual results to differ materially are the risks and uncertainties discussed in this Quarterly Report on Form 10-QSB, including, without limitation, the portions of such reports under the captions referenced above, and the uncertainties set forth from time to time in the Company's filings with the Securities and Exchange Commission, and other public statements. Such risks and uncertainties include, without limitation, seasonality, interest in the Company's products, consumer acceptance of new products, general economic conditions, consumer trends, costs and availability of raw materials and management information systems, competition, litigation and the effect of governmental regulation. The Company disclaims any intention or obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. 8 PART II OTHER INFORMATION - ------------------ ITEM 1 LEGAL PROCEEDINGS NONE ITEM 2 CHANGES IN SECURITIES NONE ITEM 3 DEFAULTS ON SENIOR SECURITIES NONE ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS NONE ITEM 5 OTHER INFORMATION NONE ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits None (b) Reports on Form 8-K None 9 SIGNATURES In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. DYNASIL CORPORATION OF AMERICA BY: /s/ John Kane DATED: February 9,2001 --------------------------------- -------------------- John Kane, President, Treasurer, Chief Financial Officer and Principal Accounting Officer BY: /s/ Charles J. Searock, Jr. DATED: February 12,2001 --------------------------------- -------------------- Charles J. Searock, Jr., CEO 10 -----END PRIVACY-ENHANCED MESSAGE-----