-----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, i17fSp5XA7EYMxG0yjM8wpWzF6DF0YqqEfN+Zd3E2Kwow1OZNxUiwbKOG6DW6Yy4 axroK4QHClLHp49P1UDAiA== 0000950123-95-002265.txt : 19950814 0000950123-95-002265.hdr.sgml : 19950814 ACCESSION NUMBER: 0000950123-95-002265 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950630 FILED AS OF DATE: 19950811 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ANALYSIS & TECHNOLOGY INC CENTRAL INDEX KEY: 0000310876 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-ENGINEERING SERVICES [8711] IRS NUMBER: 952579365 STATE OF INCORPORATION: CT FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-14161 FILM NUMBER: 95561835 BUSINESS ADDRESS: STREET 1: TECHNOLOGY PARK RTE 2 STREET 2: PO BOX 220 CITY: NORTH STONINGTON STATE: CT ZIP: 06359 BUSINESS PHONE: 2035993910 MAIL ADDRESS: STREET 1: TECHNOLOGY PARK RTE 2 STREET 2: P O BOX 220 CITY: NORTH STONINGTON STATE: CT ZIP: 06359 10-Q 1 ANALYSIS & TECHNOLOGY, INC. -- FORM 10-Q 1 =============================================================================== FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) /X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended JUNE 30, 1995 ------------------------------------------------- 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 0-14161 --------------------------------------------------------- ANALYSIS & TECHNOLOGY, INC. - ------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Connecticut 95-2579365 ------------------------------- ------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) Route 2, North Stonington, Connecticut 06359 - ------------------------------------------------------------------------------- (Address of principal executive office) (Zip Code) (203) 599-3910 - ------------------------------------------------------------------------------- (Registrant's telephone number, including area code) - ------------------------------------------------------------------------------- (Former name, former address, and former 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 --- --- APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS: Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13, or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes No --- --- APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. As of the close of business August 8, 1995, the registrant had outstanding 2,412,815 shares of Common Stock. =============================================================================== 2 CONTENTS
PAGE ---- PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS 1 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 5 PART II. OTHER INFORMATION REQUIRED IN REPORT ITEM 1. LEGAL PROCEEDINGS 7 ITEM 2. CHANGES IN SECURITIES 7 ITEM 3. DEFAULTS UPON SENIOR SECURITIES 7 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 7 ITEM 5. OTHER INFORMATION 7 ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 7
i 3 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS ANALYSIS & TECHNOLOGY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS FOR THE QUARTERS ENDED JUNE 30, 1995 AND 1994 (AMOUNTS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
JUNE 30, 1995 JUNE 30, 1994 ------------- ------------- Revenues $31,671 $31,404 Costs & expenses 30,117 30,128 ------- ------- Operating earnings 1,554 1,276 ------- ------- Other deductions: Interest expense 184 107 Interest income (1) (2) Other, net 130 23 ------- ------- 313 128 ------- ------- Earnings before income taxes 1,241 1,148 Income taxes 527 466 ------- ------- Net earnings $ 714 $ 682 ======= ======= Earnings per common and common equivalent share $ 0.29 $ 0.28 ======= ======= Weighted average shares and common equivalent shares outstanding during the period $ 2,455 $ 2,473 ======= =======
See accompanying note to the consolidated financial statements. 1 4 ANALYSIS & TECHNOLOGY, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (AMOUNTS IN THOUSANDS)
ASSETS JUNE 30, 1995 MARCH 31, 1995 ------ ------------- -------------- Current assets: Cash and cash equivalents $ 789 $ 502 Contract receivables 26,795 27,816 Notes and other receivables 1,099 1,147 Prepaid expenses 687 1,009 ------- ------- Total current assets 29,370 30,474 Property, buildings, and equipment, net 15,056 15,604 Other assets: Goodwill, net 6,788 6,783 Deposits and other receivables 362 429 Product development costs, net 9,059 8,532 Other 3,457 3,227 ------- ------- 19,666 18,971 ------- ------- TOTAL ASSETS $64,092 $65,049 ======= ======= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Short-term borrowings $ 404 $ 4 Current installments of long-term debt 317 309 Accounts payable 2,802 4,013 Accrued expenses 6,147 8,708 Dividends payable -- 616 Deferred income taxes 991 1,214 ------- ------- Total current liabilities 10,661 14,864 Long-term debt, excluding current installments 8,762 6,933 Deferred income taxes 4,160 3,675 Other long-term liabilities 2,567 2,403 ------- ------- TOTAL LIABILITIES 26,150 27,875 ------- ------- Shareholders' equity: Common stock, $.125 stated value Authorized 7,500,000 shares; issued 2,377,390 shares at June 30, 1995 and 2,371,399 at March 31, 1995. 297 296 Additional paid-in capital 9,339 9,286 Retained earnings 28,306 27,592 ------- ------- TOTAL SHAREHOLDERS' EQUITY 37,942 37,174 ------- ------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $64,092 $65,049 ======= =======
See accompanying note to the consolidated financial statements. 2 5 ANALYSIS & TECHNOLOGY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE QUARTERS ENDED JUNE 30, 1995 AND 1994 (AMOUNTS IN THOUSANDS)
JUNE 30, 1995 JUNE 30, 1994 ------------- ------------- OPERATING ACTIVITIES: Net earnings $ 714 $ 682 ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES: Depreciation and amortization of fixed assets 672 688 Amortization of goodwill 111 100 Amortization of product development costs 153 173 Loss on sale of equipment 252 14 Advance from customer 0 25 Decrease (increase) in: Contract receivables 1,021 (252) Notes and other receivables 48 (98) Prepaid expenses 322 (153) Other assets (163) (163) Increase (decrease) in: Accounts payable and accrued expenses (3,772) 1,096 Deferred income taxes 262 203 Other long-term liabilities 164 43 ------- ------- NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES (216) 2,358 ------- ------- INVESTING ACTIVITIES: Additions to property, buildings, and equipment (381) (987) New product development costs (680) (1,133) Proceeds from the sale of equipment 5 3 Acquisition of business units (net of cash acquired) (116) (970) ------- ------- NET CASH USED BY INVESTING ACTIVITIES (1,172) (3,087) ------- ------- FINANCING ACTIVITIES: Net proceeds from (repayments of) short-term borrowings 400 (395) Proceeds from long-term debt borrowings 1,910 1,305 Principal repayments of long-term debt (73) (67) Proceeds from sale of common stock 54 145 Dividends paid (616) (556) ------- ------- NET CASH PROVIDED BY FINANCING ACTIVITIES 1,675 432 ------- ------- Increase (decrease) in cash and cash equivalents 287 (297) CASH AND CASH EQUIVALENTS: BEGINNING OF PERIOD 502 729 ------- ------- End of period $ 789 $ 432 ------- -------
See accompanying note to the consolidated financial statements. 3 6 ANALYSIS & TECHNOLOGY, INC. AND SUBSIDIARIES NOTE TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 1995 The information furnished in the accompanying unaudited Consolidated Statement of Earnings, Consolidated Balance Sheets, and Consolidated Statements of Cash Flows reflect all adjustments (consisting only of items of a normal recurring nature) which are, in the opinion of management, necessary for a fair statement of the Company's results of operations and financial position for the interim periods. These financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Company's Annual Report for the year ended March 31, 1995. 4 7 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS A summary of comparative results for the quarters ended June 30, 1995 and June 30, 1994 is as follows: THREE MONTHS ENDED JUNE 30
PERCENT 1995 1994 CHANGE ---- ---- ------- Revenue $31,671,000 $31,404,000 0.9% Operating Earnings 1,554,000 1,276,000 21.8% Earnings before income taxes 1,241,000 1,148,000 8.1% Net Earnings 714,000 682,000 4.7% Earnings per common and common equivalent share 0.29 0.28 3.6% Weighted average shares and common equivalent shares outstanding during the period 2,455,000 2,473,000 (0.7%)
Revenue increased 0.9% to $31.7 million for the three months ended June 30, 1995 (the first quarter of fiscal 1996) from $31.4 million for the three months ended June 30, 1994. The Company's labor related revenues increased approximately $700 thousand for the quarter while non-labor related revenue generated by purchased components, computer usage, travel and work subcontracted to other companies decreased approximately $400 thousand. Operating earnings for the quarter ended June 30, 1995 increased 21.8% to $1.6 million from $1.3 million for the quarter ended June 30, 1994. Operating earnings as a percentage of revenue (operating margins) increased to 4.9% compared with 4.1% in the previous year's comparable quarter. The increase in operating margins was due primarily to higher fees earned on the Company's defense related work and improved operating efficiencies in its commercial interactive multimedia operations, including higher than anticipated earnings on a large fixed price project. Overall, operating margins in both the current and prior year quarter were adversely affected by expenditures for new business initiatives in information technologies and interactive multimedia systems. The Company plans to continue these expenditures and future margins may be adversely affected. The total of interest expense, interest income and other net expenses as a percentage of revenue increased to 1.0% for the current quarter ended June 30, 1995 as compared with 0.4% in the prior fiscal year first quarter. Interest expense, net of interest income, as a percentage of revenue increased to 0.6% in the first quarter of fiscal 1996 as compared with 0.3% in the first quarter of fiscal 1995. The increase was primarily the result of higher interest rates and increased borrowing under the Company's revolving credit agreement primarily due to continuing investment in on-line registration systems and an increase in the time for payment of contract receivables by the Government as discussed more fully below in Liquidity and Capital Resources. Other net expense increased to 0.4% in the first quarter of fiscal 1996 as compared with 0.1% in the first quarter of fiscal 1995. Other net expense was low in the first quarter of fiscal 1995 due to the effect of a key person insurance payment received by Automated Software Inc. (ASI), a joint venture company. The effect of this payment, net of expenses, on the Company's fiscal 1995 earnings was $115,000. Earnings before income taxes increased 8.1% to $1.2 million from $1.1 million in the first quarter of fiscal 1996. The increase was a result of a higher operating earnings partially offset by higher interest and other expenses as discussed above. 5 8 The Company's effective tax rate was 42.5% for the three-month period ended June 30, 1995 compared with 40.6% for the three-month period ended June 30, 1994. The lower effective tax rate in fiscal 1995 was due, in part, to higher earnings in ASI as a result of the key person insurance payment. ASI's earnings are reported by the Company on an after-tax basis and are not included in the Company's taxable income. Net earnings for the first quarter of fiscal 1996 increased 4.7% to $714,000 from $682,000 in the first quarter of fiscal 1995. Earnings per share increased 3.6% to $0.29 in the first quarter of fiscal 1996 from $0.28 in the prior year's first quarter. The weighted average number of common shares and common equivalent shares outstanding decreased slightly to 2.46 million for the current fiscal quarter compared with 2.47 million in fiscal 1995 first quarter. This was due to a decrease in the average price of the Company's stock which decreased the number of common equivalent shares attributable to stock options. LIQUIDITY AND CAPITAL RESOURCES Net cash provided from financing activities in the first quarter of fiscal 1996 totaled $1.7 million. The primary contributor to cash provided from financing activities was borrowings under the Company's revolving credit agreement. Significant uses of cash during the quarter were for reduction of accounts payable and accrued expenses and for continued investment in new product development. Capitalized software development costs, primarily for on-line registration system product development, totaled $680,000 during the quarter. Contract receivables totaled $26.8 million at June 30, 1995, $27.8 million at March 31, 1995, and $24.7 million at June 30, 1994 and represented 42%, 43%, and 42%, respectively, of total assets at each of those dates. The average period for payment to the Company was 77 days at June 30, 1995, and 72 days at March 31, 1995 and June 30, 1994. The increase in the average period for payment to the Company was due to continuing software problems and procedural changes at the Government paying office which delayed the processing of the Company's invoices. Any capital needs not satisfied by cash generated from operations were, and in the future will be, met with money borrowed by the Company under its line of credit and revolving credit agreement. The total funds available to the Company under these agreements at June 30, 1995 was $20.0 million. Borrowings under these agreements were $5.8 million at June 30, 1995, $3.5 million at March 31, 1995, and $2.1 million as of June 30, 1994, respectively. It is anticipated that the Company's existing cash, together with funds generated from operations and borrowings under its line of credit and revolving credit agreements, will be sufficient to meet its normal working capital requirements and investments in software product development for the foreseeable future. As of June 30, 1995, the Company does not have any major capital commitments. The Company believes that inflation has not had a material effect on its business. 6 9 PART II. OTHER INFORMATION REQUIRED IN REPORT ITEM 1. LEGAL PROCEEDINGS NONE. ITEM 2. CHANGES IN SECURITIES NONE. ITEM 3. DEFAULTS UPON 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 27 FINANCIAL DATA SCHEDULE B. REPORTS NONE. 7 10 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. ANALYSIS & TECHNOLOGY, INC. Date: August 9, 1995 /s/ Gary P. Bennett ---------------------------- --------------------------- Gary P. Bennett President and CEO Date: August 9, 1995 /s/ David M. Nolf ---------------------------- --------------------------- David M. Nolf Executive Vice President 8 11 EXHIBIT INDEX ------------- Exhibit 27 Financial Data Schedule EX-27 2 FINANCIAL DATA SCHEDULE
5 0000310876 ANALYSIS & TECHNOLOGY, INC. 1,000 U.S. DOLLARS OTHER MAR-31-1996 APR-01-1995 JUN-30-1995 1 789 0 26,795 0 0 29,370 32,033 16,977 64,092 10,661 0 297 0 0 37,645 64,092 0 31,671 0 30,117 130 0 183 1,241 527 714 0 0 0 714 0.29 0
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