-----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, lGZHFtr7ydFmkrzMZC8eGM+rUVxm05WIUdqmIIjxaIsJKorqAfyNJNCB7s3SMkJD GKiuT/7h77JlurlUHW+s2g== 0000950131-94-000625.txt : 19940531 0000950131-94-000625.hdr.sgml : 19940531 ACCESSION NUMBER: 0000950131-94-000625 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19940331 FILED AS OF DATE: 19940513 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ANDREW CORP CENTRAL INDEX KEY: 0000317093 STANDARD INDUSTRIAL CLASSIFICATION: 3663 IRS NUMBER: 362092797 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-09514 FILM NUMBER: 94527985 BUSINESS ADDRESS: STREET 1: 10500 W 153RD ST CITY: ORLAND PARK STATE: IL ZIP: 60462 BUSINESS PHONE: 7083493300 MAIL ADDRESS: STREET 1: 10500 WEST 153RD ST CITY: ORLANDO PARK STATE: IL ZIP: 60462 10-Q 1 FORM 10-Q (3-31-94) 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 March 31, 1994 ------------------------------- 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 0-9514 ------ Andrew Corporation - - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 36-2092797 - - ---------------------------------------- ---------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 10500 W. 153rd Street, Orland Park, IL 60462 - - ---------------------------------------- ---------------------------- (Address of principal executive offices) (Zip Code) (708) 349-3300 - - -------------------------------------------------------------------------------- (Registrant's telephone number, including area code) No Change - - -------------------------------------------------------------------------------- (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 --- --- Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practical date. Common Stock, $.01 Par Value--25,419,713 shares as of April 30, 1994 -------------------------------------------------------------------- INDEX ANDREW CORPORATION PART I. FINANCIAL INFORMATION - - ------------------------------ Item 1. Financial Statements (Unaudited) Consolidated condensed balance sheets--March 31, 1994 and September 30, 1993. Consolidated condensed statements of income--Three months ended March 31, 1994 and 1993; Six months ended March 31, 1994 and 1993. Consolidated condensed statements of cash flows--Six months ended March 31, 1994 and 1993. Notes to consolidated condensed financial statements--March 31, 1994. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. PART II OTHER INFORMATION - - -------------------------- Item 4. Submission of Matters to a Vote of Security Holders. Item 6. Exhibits and Reports on Form 8-K. EXHIBIT 11 - Computation of Earnings per Share. SIGNATURES - - ---------- -1- ANDREW CORPORATION CONSOLIDATED CONDENSED BALANCE SHEETS (in thousands)
March 31 September 30 1994 1993 ASSETS ------------- -------------- (Unaudited) CURRENT ASSETS Cash and cash equivalents $ 9,745 $ 21,729 Accounts receivable, less allowance of (Mar. $2,915; 126,410 107,276 Sep. $3,167) Inventories: Finished products 24,454 18,611 Materials and work in process 60,298 51,695 --------- --------- 84,752 70,306 Miscellaneous current assets 4,142 3,309 --------- --------- TOTAL CURRENT ASSETS 225,049 202,620 OTHER ASSETS Cost in excess of net assets of businesses acquired, less amortization (Mar. $12,635 Sep. $11,310) 39,555 40,881 Investment in and advances to affiliates 25,437 16,493 Investments and other assets 13,259 8,996 PROPERTY, PLANT AND EQUIPMENT 216,517 207,511 Less allowances for depreciation (146,717) (139,398) --------- --------- 69,800 68,113 --------- --------- $ 373,100 $ 337,103 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Short-term borrowings $ 10,501 $ Accounts payable 19,709 18,561 Accrued expenses and other liabilities 27,111 19,170 Compensation and related expenses 13,961 15,950 Income taxes 11,399 10,250 --------- --------- TOTAL CURRENT LIABILITIES 82,681 63,931 DEFERRED LIABILITIES 4,253 3,602 LONG-TERM DEBT 50,000 50,000 STOCKHOLDERS' EQUITY Common Stock - (par value $.01 a share) Authorized - 100,000,000 Issued - 30,435,882 304 203 Additional paid-in capital 29,017 28,448 Retained earnings 266,053 250,534 Foreign currency translation (6,302) (5,410) Treasury stock, at cost (5,089,407 shares Mar.; 5,243,517 shares Sep.) (52,906) (54,205) --------- --------- 236,166 219,570 --------- --------- $ 373,100 $ 337,103 ========= =========
The balance sheet at September 30, 1993 has been derived from the audited financial statements at that date. See notes to consolidated condensed financial statements. -2- ANDREW CORPORATION CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Unaudited) (In thousands, except per share amounts)
Three Months Ended Six Months Ended March 31 March 31 -------------------- -------------------- 1994 1993 1994 1993 --------- --------- --------- --------- Sales $142,159 $99,886 $263,905 $200,918 Cost of products sold 89,476 60,384 162,402 121,669 -------- ------- -------- -------- Gross profit 52,683 39,502 101,503 79,249 Operating expenses: Sales and administrative 30,665 25,877 61,989 52,443 Research and development 6,346 5,486 12,948 10,842 -------- ------- -------- -------- 37,011 31,363 74,937 63,285 -------- ------- -------- -------- Operating income 15,672 8,139 26,566 15,964 Other: Interest expense 1,323 1,294 2,558 2,868 Interest income (222) (157) (507) (375) Other (income) expense 365 (201) 267 (1,304) -------- ------- -------- -------- 1,466 936 2,318 1,189 -------- ------- -------- -------- Income before income taxes 14,206 7,203 24,248 14,775 Income taxes 5,114 2,669 8,729 5,471 -------- ------- -------- -------- Net income $ 9,092 $ 4,534 $ 15,519 $ 9,304 ======== ======= ======== ======== Net income per average share of common stock outstanding $ .35 $ .18 $ .60 $ .37 ======== ======= ======== ======== Average shares outstanding 26,045 25,571 26,015 25,355 ======== ======= ======== ========
See notes to consolidated condensed financial statements. -3- ANDREW CORPORATION CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands)
Six Months Ended March 31 ------------------- 1994 1993 -------- -------- Cash Flows from Operations Net income $ 15,519 $ 9,304 Adjustments to net income Depreciation and amortization 10,769 10,106 Decrease (increase) in accounts receivable (19,404) 1,677 Decrease (increase) in inventories (14,460) 25 Increase in prepaid expenses and other assets (644) (1,756) Increase in receivables from affiliates (4,703) Increase (decrease) in accounts payable and other liabilities 10,062 (9,463) Other (4) 100 -------- -------- Net Cash provided by (used in) Operations (2,865) 9,993 Investing Activities Increased investment in affiliates (8,944) (2,746) Capital expenditures (11,439) (9,336) Proceeds from sale of property, plant, and equipment 80 322 -------- -------- Net Cash used in Investing Activities (20,303) (11,760) Financing Activities Proceeds from (payment of) short-term borrowings 10,501 (2,550) Payments on long-term debt (2,556) Stock purchase and option plans 888 2,921 -------- -------- Net Cash provided by (used in) Financing Activities 11,389 (2,185) Foreign currency translation adjustments (205) (1,311) -------- -------- Decrease for the period (11,984) (5,263) Cash and cash equivalents at beginning of period 21,729 7,433 -------- -------- Cash and cash equivalents at end of period $ 9,745 $ 2,170 ======== ========
See notes to consolidated condensed financial statements. -4- ANDREW CORPORATION NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS NOTE A--BASIS OF PRESENTATION The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of 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 month period ended March 31, 1994 are not necessarily indicative of the results that may be expected for the year ending September 30, 1994. 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 year ended September 30, 1993. NOTE B--INCOME TAXES Effective October 1, 1993 Andrew Corporation changed its method of accounting for income taxes from the deferred method to the liability method required by SFAS No. 109, "Accounting for Income Taxes". Adoption of this statement did not have a material effect on the Company's financial statements. NOTE C--POSTRETIREMENT BENEFITS OTHER THAN PENSIONS The Company adopted SFAS No. 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions", effective October 1, 1993. Adoption of this statement did not have a material effect on the Company's financial statements. NOTE D--STOCK SPLIT On February 2, 1994 the Company's Board of Directors declared a three-for-two stock split to stockholders of record on February 16, 1994, payable on March 2, 1994. On February 2, 1994 the stockholders approved an increase in the common stock authorized from 30,000,000 to 100,000,000. All share and per share amounts have been restated for all periods presented to reflect the stock split. -5- ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND - - ------------------------------------------------------------------------ RESULTS OF OPERATIONS --------------------- RESULTS OF OPERATIONS Net sales for the quarter ended March 31, 1994 increased 42% over the same period last year to $142.2 million, bringing the total for the first six months to $263.9 million, a 31% increase over the same period last year. The increase reflects strong demand for Andrew's wireless communication products and services, including revenue from the Company's participation in the construction of a major cellular system in Argentina. Revenues from the Argentina project were $24.5 million for the quarter and $31.9 million for the first six months. Although we expect additional revenue from Argentina in the second half of the year, it will not be at the same level as during the first six months. These increases were partially offset by weaker performances in the network products and government electronic businesses. Cost of products sold as a percentage of sales for the quarter increased to 62.9%, up from 60.5% for the prior year quarter. For the first six months, cost of products sold was 61.5% of sales compared to 60.6% in the prior year. The increase for the quarter and the first six months reflects lower than average margins on the Argentina project. Sales and administrative expenses increased 19% to $30.7 million for the quarter, and increased 18% to $62.0 million for the first six months. The increase for both periods represents Russian joint venture development expenses, increased staffing for European outreach programs, and increased profit sharing expense. Research and development expenses increased $860,000 for the quarter and $2.1 million during the first six months. This increase was primarily due to increased product development costs for the Company's wireless telephone and network product businesses. Other expense for the quarter was $365,000, a $566,000 increase in expense compared to the prior year quarter. This expense increase primarily reflects prior year quarter foreign exchange gains of $155,000 compared to losses of $123,000 in the current quarter. Other expense for the first six months was $267,000, a $1.6 million increase in expense compared with the prior year. This increase in expense also reflects that the results for the first six months of the prior year included foreign exchange gains of $1.3 million. LIQUIDITY AND CAPITAL RESOURCES Net cash used in operations during the first six months totaled $2.9 million compared to net cash from operations of $10.0 million for same period last year. The cash used in operations primarily reflects that the Company's record orders and sales drove a $19.4 million increase in accounts receivable, and a $14.5 increase in inventories. The $8.9 million increase in investment in affiliates during the first six months reflects the Company's continuing investment in its Russian joint ventures. Short-term borrowings increased $10.5 million primarily to finance temporary investments in accounts receivable and inventory related to the Argentina project. -6- PART II - OTHER INFORMATION ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS (a) Andrew's Annual Meeting of Stockholders was held on February 2, 1994.
(b) & (c) Items held for vote Number of Shares Voted ---------------------------------------------------------- For Against Abstentions ----------- -------------- ------------ 1. Election of Directors John G. Bollinger 16,916,358 4,781,781 Jon L. Boyes 21,652,986 45,153 George N. Butzow 21,656,220 41,919 Kenneth J. Douglas 16,915,503 4,782,636 Floyd L. English 16,923,303 4,774,836 Donald N. Frey 21,654,915 43,224 Carole M. Howard 21,648,116 50,023 Armand J. Wade 21,654,417 43,722 2. Increase authorized shares of common stock from 30,000,000 to 100,000,000 17,763,572 3,847,864 86,703 3. Replacement of Andrew Employee Stock Purchase Plan 20,851,229 278,308 568,602 4. Ratify appointment of Ernst & Young as independent public auditors for Fiscal 1994. 21,651,530 19,123 27,486
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits: Exhibit 11 - Computation of earnings per share. (b) Reports on Form 8-K No reports on Form 8-K were filed during the quarter ended March 31, 1994. Note: Share amounts in this exhibit have been restated to reflect a three-for-two stock split to stockholders of record on February 16, 1994. -7- EXHIBIT 11 ANDREW CORPORATION Computation of Earnings Per Share (In thousands, except per share amounts)
Three Months Ended Six Months Ended March 31 March 31 ------------------ ----------------- 1994 1993 1994 1993 ------- -------- ------ -------- PRIMARY EARNINGS PER SHARE Average shares outstanding 25,277 24,869 25,247 24,708 Net effect of dilutive stock options--based on the treasury stock method using average market price 749 702 693 647 ------- ------- ------- ------- TOTAL 26,026 25,571 25,940 25,355 ======= ======= ======= ======= Net income $ 9,092 $ 4,534 $15,519 $ 9,304 ======= ======= ======= ======= Per share amount $ .35 $ .18 $ .60 $ .37 ======= ======= ======= ======= FULLY DILUTED EARNINGS PER SHARE Average shares outstanding 25,277 24,869 25,247 24,708 Net effect of dilutive stock options--based on the treasury stock method using average market price in 1993, and quarter-end market price in 1994 768 702 768 647 ------- ------- ------- ------- TOTAL 26,045 25,571 26,015 25,355 ======= ======= ======= ======= Net income $ 9,092 $ 4,534 $15,519 $ 9,304 ======= ======= ======= ======= Per share amount $ .35 $ .18 $ .60 $ .37 ======= ======= ======= =======
NOTE: This calculation is submitted in accordance with the Securities Exchange Act of 1934 Release No. 9038 although not required by footnote 2 to paragraph 14 of APB Opinion No. 15 because it results in dilution of less than 3%. NOTE: All amounts and per share amounts in this exhibit have been restated to reflect a three-for-two stock split to stockholders of record on February 16, 1994. -8- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ANDREW CORPORATION Date 13 May 1994 F. L. English ---------------------------------- ------------------------------------- F. L. English President and Chief Executive Officer Date 13 May 1994 C. R. Nicholas ------------------------------------ ------------------------------------- C. R. Nicholas Vice President, Finance and Chief Financial Officer -9- -----END PRIVACY-ENHANCED MESSAGE-----