-----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, VoB7OKoYhOSo3p9Mr05rQawNA4bk0FYpGNzBoMpPS9PMYXosxpXoQvmGARebCyve YFbKI6HySxX6mNA8DEL8ug== 0000310056-96-000004.txt : 19960216 0000310056-96-000004.hdr.sgml : 19960216 ACCESSION NUMBER: 0000310056-96-000004 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19951231 FILED AS OF DATE: 19960214 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: VICON INDUSTRIES INC /NY/ CENTRAL INDEX KEY: 0000310056 STANDARD INDUSTRIAL CLASSIFICATION: COMMUNICATIONS EQUIPMENT, NEC [3669] IRS NUMBER: 112160665 STATE OF INCORPORATION: NY FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-07939 FILM NUMBER: 96519463 BUSINESS ADDRESS: STREET 1: 525 BROAD HOLLOW RD CITY: MELVILLE STATE: NY ZIP: 11747 BUSINESS PHONE: 5162932200 MAIL ADDRESS: STREET 1: 525 BROAD HOLLOW ROAD CITY: MELVILLE STATE: NY ZIP: 11747 10-Q 1 QUARTERLY REPORT SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended December 31, 1995 Commission File No. 1-7939 ---------------------------- ------- VICON INDUSTRIES, INC. (Exact name of registrant as specified in its charter) NEW YORK STATE 11-2160665 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) identification No.) 525 Broad Hollow Road, Melville, New York 11747 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (516) 293-2200 (Former name, address, and fiscal year, if changed since last report) 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 At December 31 1995, the registrant had outstanding 2,762,828 shares of Common Stock, $.01 par value. PART I - FINANCIAL INFORMATION VICON INDUSTRIES, INC. AND SUBSIDIARIES (CONDENSED) CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) Three Months Ended 12/31/95 12/31/94 Net sales........................... $10,512,468 $11,827,529 Costs and expenses: Cost of goods sold................ 7,806,854 9,129,409 Selling, general & admin. expenses........................ 2,357,942 2,378,120 Interest expense.................. 235,372 279,609 Unrealized foreign exchange gain................... (14,372) - ----------- ----------- Total costs and expenses....... 10,385,796 11,787,138 Income before income taxes.......... 126,672 40,391 Provision for income taxes.................... 25,000 24,000 ----------- ----------- Net income.......................... $ 101,672 $ 16,391 =========== =========== Net income per share $ .04 $ .01 === === Shares outstanding 2,763,000 2,763,000 See Notes to (Condensed) Consolidated Financial Statements. 2 VICON INDUSTRIES, INC. AND SUBSIDIARIES (CONDENSED) CONSOLIDATED BALANCE SHEETS (UNAUDITED) ASSETS 12/31/95 9/30/95 CURRENT ASSETS Cash............................................ $ 825,200 $ 1,151,850 Accounts receivable (less allowance of $593,000 at December 31, 1995 and $542,000 at September 30, 1995)............... 8,267,254 8,352,845 Other receivables............................... 251,278 261,864 Inventories: Parts, components, and materials.............. 1,625,270 1,594,462 Work-in-process............................... 2,014,132 1,686,287 Finished products............................. 9,038,826 8,831,852 ----------- ----------- 12,678,228 12,112,601 Prepaid expenses................................ 367,954 309,288 ----------- ----------- TOTAL CURRENT ASSETS............................ 22,389,914 22,188,448 - -------------------- Property, plant and equipment................... 13,260,686 13,222,497 Less: accumulated depreciation................. (10,116,098) (9,960,558) ----------- ----------- 3,144,588 3,261,939 Other assets.................................... 1,024,301 973,107 ----------- ----------- TOTAL ASSETS.................................... $26,558,803 $26,423,494 - ------------ =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Borrowings under revolving credit agreement..... $ 820,624 $ 906,955 Current maturities of long-term debt............ 210,871 220,739 Accounts payable: Related party................................. 8,276,120 6,895,073 Other......................................... 1,667,184 1,335,935 Accrued wages and expenses...................... 1,311,968 1,697,732 Income taxes payable............................ 105,275 78,583 Deferred gain on sale and leaseback............. 332,100 332,100 ------------ ----------- TOTAL CURRENT LIABILITIES 12,724,142 11,467,117 - ------------------------- Long-term debt: Related party................................. 2,277,267 2,437,259 Other......................................... 1,964,724 2,901,490 Deferred gain on sale and leaseback............. 350,968 433,993 Other long-term liabilities..................... 536,363 550,609 SHAREHOLDERS' EQUITY Common stock, par value $.01.................... 27,882 27,882 Capital in excess of par value.................. 9,396,890 9,396,890 Accumulated deficit............................. (482,117) (583,789) ------------ ----------- 8,942,655 8,840,983 Less Treasury stock 25,400 shares, at cost...... (82,901) (82,901) Foreign currency translation adjustment......... (154,415) (125,056) ------------ ----------- TOTAL SHAREHOLDERS' EQUITY 8,705,339 8,633,026 - -------------------------- ------------ ----------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY...... $ 26,558,803 $26,423,494 - ------------------------------------------ ============ =========== See Notes to (Condensed) Consolidated Financial Statements. 3 VICON INDUSTRIES, INC. AND SUBSIDIARIES (CONDENSED) CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) Three Months Ended 12/31/95 12/31/94 Cash flows from operating activities: Net income................................... $ 101,672 $ 16,391 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization.............. 164,207 157,924 Amortization of sale and leaseback......... (83,025) (83,025) Unrealized foreign exchange gain........... (14,372) - Change in assets and liabilities: Accounts receivable.......................... 45,762 1,056,318 Other receivables............................ 10,586 (75,785) Inventories.................................. (591,402) 1,240,549 Prepaid expenses............................ (60,592) (165,178) Other assets................................. (51,194) 8,334 Accounts payable............................ 1,721,152 (948,901) Accrued wages and expenses................... (377,884) 212,011 Income taxes payable......................... 26,912 19,092 Other liabilities........................... (14,246) (13,075) --------- --------- Net cash provided by operating activities.................. 877,576 1,424,655 --------- --------- Cash flows from investing activities: Capital expenditures, net of minor disposals........................... (74,136) (82,354) --------- ---------- Net cash used in investing activities.... (74,136) (82,354) --------- ---------- Cash flows from financing activities: Net borrowings under new credit and security agreement......................... 1,882,078 - Repayments of U.S. revolving credit agreement.................................. (2,800,000) (500,000) Decrease in borrowings under U.K. revolving credit agreement........................... (69,556) (278,145) Repayments of other debt..................... (178,639) (15,988) ---------- ---------- Net cash used in financing activities...... (1,166,117) (794,133) ---------- ---------- Effect of exchange rate changes on cash.......... 36,027 (62,877) ---------- ---------- Net increase (decrease) in cash.................. (326,650) 485,291 Cash at beginning of quarter..................... 1,151,850 910,400 ---------- ---------- Cash at end of period............................ $ 825,200 $1,395,691 ========== ========== See Notes to (Condensed) Consolidated Financial Statements. 4 VICON INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO (CONDENSED) CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) December 31, 1995 Note 1: Basis of Presentation The accompanying unaudited (condensed) consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended December 31, 1995 are not necessarily indicative of the results that may be expected for the fiscal year ended September 30, 1996. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's annual report on Form 10-K for the fiscal year ended September 30, 1995. 5 MANAGEMENT'S DISCUSSION AND ANALYSIS Results of Operations Three Months Ended December 31, 1995 Compared with December 31, 1994 Net sales for the quarter ended December 31, 1995 were approximately $10.5 million compared with $11.8 million in the corresponding quarter last fiscal year. This decrease of 11.1% was due principally to lower sales in Europe. Order intake for the quarter was $11.1 million which increased backlog to $3.3 million at December 31, 1995. Gross profit margins for the current quarter were 25.7% compared with 22.8% in the corresponding quarter one year ago. The margin increase was due principally to a change in sales mix to products with higher margins including increased control system sales. Operating expenses for the current quarter were comparable to last year at $2.4 million. Interest expense decreased by approximately $44,000 to $235,000 for the current year quarter due principally to a reduction in average interest rates During the current quarter, the Company incurred an unrealized foreign exchange gain of $14,000. This gain resulted from the Company's revaluation of its yen denominated mortgage obligation into U.S. dollars as the value of the British pound sterling gained against the Japanese yen during the period. The increase in pretax income of $86,000 was due principally to increased gross profit margins on sales during the quarter. 6 MANAGEMENT'S DISCUSSION AND ANALYSIS LIQUIDITY AND FINANCIAL CONDITION December 31, 1995 Compared with September 30, 1995 Working capital declined by approximately $1.1 million to $9.7 million at December 31, 1995. The decline was principally due to the paydown of long term bank debt pursuant to the refinancing discussed below. Accounts receivable remained principally unchanged at December 31, 1995. Inventories increased approximately $.6 million to $12.7 million at December 31, 1995 as a result of higher finished goods stocking levels and new product inventories. Accounts payable to a related party, Chugai Boyeki Co., Ltd., increased approximately $1.4 million to $8.3 million at December 31, 1995. The increase relates to inventory growth and bank refinancing. The Company has a revolving line of credit of 700,000 pounds sterling (approx. $1.1 million) in the U.K. to support local cash requirements. At December 31, 1995, borrowings under this agreement were approximately $821,000, which was used for general working capital purposes. In late December 1995, the Company repaid $2.8 million of bank debt with the proceeds of a new bank loan. The new two year loan agreement provides for maximum borrowings of $3,250,000 through June 30, 1996 and $4,000,000 thereafter, subject to an availability formula based on accounts receivable and inventories. Borrowings under such agreement amounted to approximately $1.9 million at December 31, 1995. Concurrent with the new loan agreement, the Company amended its $2,000,000 secured promissory note with Chugai Boyeki Co., Ltd., a related party, to defer all scheduled installments to July 1998. The Company believes that the new loan agreement and its other sources of credit provide adequate funding to meet its near term cash requirements. 7 PART II ITEM 1 - LEGAL PROCEEDINGS The Company has no material outstanding litigation. ITEM 2 - CHANGES IN SECURITIES None ITEM 3 - DEFAULTS UPON SENIOR SECURITIES During the quarter, the Company was in default of its then banks Revolving Credit loan. The loan was repaid on December 28, 1995 with the proceeds of a new two year credit agreement with another bank. 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 No Form 8-K was required to be filed during the current quarter. 8 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. February 13, 1996 VICON INDUSTRIES, INC. Kenneth M. Darby Arthur D. Roche President Executive Vice President Chief Executive Officer Chief Financial Officer 9 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. February 13, 1996 VICON INDUSTRIES, INC. VICON INDUSTRIES, INC. Kenneth M. Darby Arthur D. Roche Kenneth M. Darby Arthur D. Roche President Executive Vice President Chief Executive Officer Chief Financial Officer 9 EX-27 2 FDS --
5 3-MOS SEP-30-1996 DEC-31-1995 825,200 0 9,479,845 (593,359) 12,678,228 22,389,914 14,284,987 (10,116,098) 26,558,803 12,724,142 5,129,322 0 0 27,882 8,677,457 26,558,803 10,512,468 0 7,806,854 0 2,328,570 15,000 235,372 126,672 25,000 101,672 0 0 0 101,672 .04 .04
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