-----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, H2c//j+O18AUT/rdO0bm+tVI7gBGyNHKBYepbX6+UGOBwk1hiRHqVw1Wg8rO8vzX 99wapFaG8c+yzrkROIh5qw== 0000310056-95-000003.txt : 19950511 0000310056-95-000003.hdr.sgml : 19950511 ACCESSION NUMBER: 0000310056-95-000003 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19950331 FILED AS OF DATE: 19950510 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: 95536232 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 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 March 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 March 31, 1994, 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 ------------------ 3/31/95 3/31/94 ------- ------- Net sales....................... $10,952,150 $12,326,473 Costs and expenses: Cost of goods sold............ 8,601,648 9,632,776 Selling, general & admin. expenses.................... 2,451,930 2,473,548 Interest expense.............. 253,974 167,627 Unrealized foreign exchange loss............... 95,667 6,620 ----------- ----------- Total costs and expenses... 11,403,219 12,280,571 ----------- ----------- Income (loss) before income taxes................ (451,069) 45,902 Provision for income taxes................ 16,000 12,000 ----------- ----------- Net income (loss)............... $ (467,069) $ 33,902 =========== =========== Net income (loss) per share $ (.17) $ .01 ====== ===== Shares outstanding 2,762,828 2,762,828 See Notes to (Condensed) Consolidated Financial Statements.
- 2 - PART I - FINANCIAL INFORMATION ------------------------------ VICON INDUSTRIES, INC. AND SUBSIDIARIES --------------------------------------- (CONDENSED) CONSOLIDATED STATEMENTS OF OPERATIONS ------------------------------------------------ (UNAUDITED)
Six Months Ended ------------------ 3/31/95 3/31/94 ------- ------- Net sales....................... $22,779,679 $23,943,108 Costs and expenses: Cost of goods sold............ 17,731,056 18,720,347 Selling, general & admin. expenses.................... 4,830,051 4,970,434 Interest expense.............. 533,583 321,933 Unrealized foreign exchange loss (gain)........ 95,667 (23,041) ----------- ----------- Total costs and expenses... 23,190,357 23,989,673 ----------- ----------- Income (loss) before income taxes................ (410,678) (46,565) Provision for income taxes................ 40,000 12,000 ----------- ----------- Net income (loss)............... $ (450,678) $ (58,565) =========== =========== Net income (loss) per share $ (.16) $ (.02) ====== ====== Shares outstanding 2,762,828 2,762,828 See Notes to (Condensed) Consolidated Financial Statements.
- 3 - VICON INDUSTRIES, INC. AND SUBSIDIARIES (CONDENSED) CONSOLIDATED BALANCE SHEETS --------------------------------------- (UNAUDITED)
3/31/95 9/30/94 ------- ------- ASSETS - ------ CURRENT ASSETS - -------------- Cash................................. $ 747,182 $ 910,400 Accounts receivable (less allowance of $384,000 at March 31, 1995 and $309,000 at September 30, 1994).... 7,908,275 9,733,383 Other receivables.................... 264,927 301,548 Inventories: Parts, components, and materials... 2,252,585 2,458,840 Work-in-process.................... 1,446,127 1,267,344 Finished products.................. 8,565,243 9,739,832 ----------- ----------- 12,263,955 13,466,016 Prepaid expenses..................... 403,329 322,953 ----------- ----------- TOTAL CURRENT ASSETS................. 21,587,668 24,734,300 - -------------------- Property, plant and equipment........ 12,896,032 12,476,239 Less: accumulated depreciation...... (9,612,241) (9,296,420) ----------- ----------- 3,283,791 3,179,819 Other assets......................... 938,099 943,107 ----------- ----------- TOTAL ASSETS......................... $25,809,558 $28,857,226 =========== ===========
- 4 - VICON INDUSTRIES, INC. AND SUBSIDIARIES (CONDENSED) CONSOLIDATED BALANCE SHEETS --------------------------------------- (UNAUDITED)
3/31/95 9/30/94 ------- ------- LIABILITIES AND SHAREHOLDERS' EQUITY - ------------------------------------ CURRENT LIABILITIES - ------------------- Borrowings under revolving credit agreement.......................... $ 499,711 $ 936,466 Current maturities of long-term debt. 4,166,893 1,260,158 Accounts payable: Related party...................... 5,040,161 5,711,951 Other.............................. 1,357,753 1,812,756 Accrued wages and expenses........... 1,407,865 1,289,511 Income taxes payable................. 70,300 32,270 Deferred gain on sale and leaseback.. 332,100 332,100 ----------- ----------- TOTAL CURRENT LIABILITIES 12,874,783 11,375,212 - ------------------------- Long-term debt: Related party...................... 2,021,401 2,332,632 Other.............................. 137,789 3,726,270 Deferred gain on sale and leaseback.. 600,043 766,093 Other long-term liabilities.......... 576,713 614,487 SHAREHOLDERS' EQUITY - -------------------- Common stock, par value $.01......... 27,882 27,882 Capital in excess of par value....... 9,396,890 9,396,890 Earnings retained in the business.... 312,578 763,256 ----------- ----------- 9,737,350 10,188,028 Less Treasury stock 25,400 shares, at cost............................ (82,901) (82,901) Foreign currency translation adjustment......................... (55,620) (62,595) ----------- ----------- TOTAL SHAREHOLDERS' EQUITY 9,598,829 10,042,532 - -------------------------- ----------- ----------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY............................ $25,809,558 $28,857,226 =========== =========== See Notes to (Condensed) Consolidated Financial Statements
- 5 - VICON INDUSTRIES, INC. AND SUBSIDIARIES (CONDENSED) CONSOLIDATED STATEMENTS OF CASH FLOWS ------------------------------------------------- (UNAUDITED)
Six Months Ended ---------------- 3/31/95 3/31/94 ------- ------- Cash flows from operating activities: Net loss.................................. $ (450,678) $ (58,565) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Depreciation and amortization........... 305,325 360,422 Amortization of deferred gain on sale and leaseback.................... (166,050) (166,050) Unrealized foreign exchange (gain) loss. 95,667 (23,041) Change in assets and liabilities: Accounts receivable....................... 1,873,040 (432,483) Other receivables......................... 36,621 203,937 Inventories............................... 1,247,311 (1,557,535) Prepaid expenses.......................... (78,185) (123,488) Other assets.............................. 5,008 (197,268) Accounts payable.......................... (1,132,578) (239,642) Accrued wages and expenses................ 109,274 (145,641) Income taxes payable...................... 36,445 7,925 Other liabilities......................... (37,774) (9,046) ----------- ----------- Total adjustments........................ 2,294,104 (2,321,910) ----------- ----------- Net cash provided by (used in) operating activities................ 1,843,426 (2,380,475) ----------- ----------- Cash flows from investing activities: Capital expenditures, net of minor disposals............................... (372,237) (262,686) ----------- ----------- Net cash used in investing activities....... (372,237) (262,686) ----------- ----------- Cash flows from financing activities: Increase in UK bank and other borrowings... - 765,832 Issuance of promissory note to related party............................ - 2,000,000 Repayments of revolving credit borrowings and other debt................ (1,639,874) (933,890) ----------- ----------- Net cash (used in) provided by financing activities................................. (1,639,874) 1,831,942 Effect of exchange rate changes on cash...... 5,467 80,216 ----------- ----------- Net decrease in cash......................... (163,218) (731,003) Cash at beginning of year.................... 910,400 1,039,113 ----------- ----------- Cash at end of period........................ $ 747,182 $ 308,110 =========== =========== See Notes to (Condensed) Consolidated Financial Statements.
- 6 - VICON INDUSTRIES, INC. AND SUBSIDIARIES --------------------------------------- NOTES TO (CONDENSED) CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - --------------------------------------------------------------------------- March 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 six months ended March 31, 1995 are not necessarily indicative of the results that may be expected for the fiscal year ended September 30, 1995. 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, 1994. - 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL ------------------------------------------------- CONDITION AND RESULTS OF OPERATIONS ----------------------------------- Financial Condition and Changes Thereto at March 31, 1995 and September 30, 1994 - ---------------------------------------- Working capital declined by approximately $4.6 million to $8.7 million at March 31, 1995. The decline in working capital resulted from the current classification of $3.4 million of borrowings under the U.S. revolving credit agreement which expires in October 1995 and the repayment of $1.1 million of borrowings under such agreement. Accounts receivable decreased approximately $1.8 million to $7.9 million at March 31, 1995. The decline was principally the result of lower sales. Inventories decreased $1.2 million to $12.3 million at March 31, 1995. Inventories declined throughout the period as the Company sold certain products which had high inventory levels at September 30, 1994. Accounts payable to a related party and other decreased approximately $1.1 million to $6.4 million at March 31, 1995, as cash generated from the lower inventory levels was used to reduce these obligations. The Company maintains a line of credit of 700,000 pounds sterling (approximately $1,050,000) in the U.K. to support local operating cash requirements. Borrowings under this line decreased approximately $437,000 to $500,000 at March 31, 1995 as Vicon's U.K. subsidiary inventory levels declined during the quarter. As a result of the loss in the current quarter, the Company is not in compliance with a financial covenant of its revolving credit agreement. The Company has requested a waiver from the banks. The Company is in the process of seeking financing with alternative lenders. - 8 - Results of Operations - --------------------- Three Months Ended March 31, 1995 compared with March 31, 1994 - -------------------------------------------------------------- Net sales for the quarter ended March 31, 1995 were $11.0 million compared with $12.3 million in the corresponding quarter last year. This decrease of 11.1% was due to lower sales in the United States. The backlog of orders was $1.6 million at March 31, 1995 compared with $2.6 million at December 31, 1994. Gross profit margins for the current quarter were 21.5% compared with 21.9% in the corresponding quarter one year ago. The margin decline was due to the unfavorable impact of lower sales in relation to fixed production costs. Operating expenses for the current quarter were comparable to last year at $2.5 million. Interest expense increased by $86,000 to $254,000 for the current year quarter as a result of higher interest rates. In recent months, the Japanese yen appreciated significantly versus the U.S. dollar resulting in a foreign exchange loss of $96,000 from the revaluation of a yen denominated mortgage obligation. The increase in the pretax loss of $497,000 was due to reduced sales, higher interest costs and increased foreign currency losses. Six Months Ended March 31, 1995 compared with March 31, 1994 - ------------------------------------------------------------ Net sales for the six months ended March 31,1995 were $22.8 million, a decrease of 4.9% compared with $23.9 million for the comparable period last fiscal year. The shortfall for the last year was due to lower sales in the U.S. offset in part by higher sales in international markets. The gross margin was 22.2% compared with 21.8% in the corresponding period last year. The margin increase was due principally to higher margins on U.S. produced products sold in Europe. Operating expenses were $4.8 million for the current period compared to $5.0 million last fiscal year. This decrease related primarily to ongoing cost reduction efforts. Interest expense increased by $212,000 to $534,000 due to higher interest rates. In recent months, the Japanese yen appreciated significantly versus the U.S. dollar resulting in a foreign exchange loss of $96,000 from the revaluation of a yen denominated mortgage obligation. Last year, the yen depreciated against the dollar resulting in a foreign exchange gain of $23,000. The increase in the pretax loss of $364,000 was the result of lower sales, higher interest costs and higher foreign currency losses. - 9 - 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 - ------ ------------------------------- See "Management's Discussion and Analysis of Financial Condition" for information regarding certain loan covenant matters. ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - ------ --------------------------------------------------- The Company's annual meeting was held on April 27, 1995. The following directors were elected at the meeting: Milton F. Gidge Michael D. Katz W. Gregory Robertson Arthur V. Wallace The terms of the following directors continued after the meeting: Peter F. Barry Kenneth M. Darby Donald N. Horn Peter F. Neumann Arthur D. Roche Kazuyoshi Sudo The matters voted upon at the meeting and the results of each vote are as follows: Nominees Withheld For Directors: For Authority -------------- --- --------- Mr. Gidge 2,415,887 242,033 Mr. Katz 2,644,544 13,376 Mr. Robertson 2,416,187 241,733 Mr. Wallace 2,415,037 242,883 - 10 - Withheld For Authority --- --------- Approval of the Ratification of Auditors 2,451,245 202,158 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. - 11 - 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. May 11, 1995 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 - 12 - -----END PRIVACY-ENHANCED MESSAGE-----