-----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, V4/EfCKNoz48DcAyAta85CYyplVRZccJQG1oDroHXaQML9At7e2ApCWnzZ9xiZ7G chNFtVI2gV9r4MI/v8NPZA== 0000350621-95-000015.txt : 19951124 0000350621-95-000015.hdr.sgml : 19951124 ACCESSION NUMBER: 0000350621-95-000015 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19950929 FILED AS OF DATE: 19951113 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: C COR ELECTRONICS INC CENTRAL INDEX KEY: 0000350621 STANDARD INDUSTRIAL CLASSIFICATION: 3663 IRS NUMBER: 240811591 STATE OF INCORPORATION: PA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-10726 FILM NUMBER: 95589813 BUSINESS ADDRESS: STREET 1: 60 DECIBEL RD CITY: STATE COLLEGE STATE: PA ZIP: 16801 BUSINESS PHONE: 8142382461 MAIL ADDRESS: STREET 1: 60 DECIBEL ROAD CITY: STATE COLLEGE STATE: PA ZIP: 16801 10-Q 1 FORM 10-Q QUARTER ENDING 09/29/95 United States SECURITIES & EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q [ X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the thirteen-week period ended: September 29, 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: 0-10726 C-COR ELECTRONICS, INC. (Exact name of registrant as specified in its charter) Pennsylvania 24-0811591 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 60 Decibel Road, State College, PA 16801 (Address of principal executive offices) (Zip Code) (814) 238-2461 (Registrant's telephone number, including area code) Not applicable (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 CORPORATE ISSUERS Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practical date: Common Stock, $.10 Par Value - 9,552,388 shares as of September 29, 1995. INDEX C-COR ELECTRONICS, INC. PART I. FINANCIAL INFORMATION Item 1. Financial Statements (unaudited). Consolidated condensed balance sheets -- June 30, 1995 and September 29, 1995 Consolidated condensed statements of income -- thirteen-weeks ended September 29, 1995 and September 23, 1994 Consolidated condensed statements of cash flows -- thirteen-weeks ended September 29, 1995 and September 23, 1994 Notes to consolidated condensed financial statements -- September 29, 1995 Item 2. Management's Discussion and Analysis of Financial Conditions and Results of Operations. PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K. 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. C-COR ELECTRONICS, INC. (Registrant) Date: November 13, 1995 /s/ CHRIS A. MILLER Chris A. Miller, C.P.A., Vice President-Finance, Secretary & Treasurer (Principal Financial Officer) Date: November 13, 1995 /s/ JOSEPH E. ZAVACKY Controller & Assistant Secretary (Principal Accounting Officer) Item 1. Financial Statments C-COR Electronics, Inc. Consolidated Condensed Balance Sheet ASSETS
September 29 June 30 1995 1995 (Unaudited) (Note) (000's omitted) CURRENT ASSETS: Cash and cash equivalents $ 1,006 $ 1,545 Marketable securities 377 393 Accounts receivable 29,558 33,142 30,941 35,080 Inventories: Raw materials 16,677 16,406 Work-in-process 4,971 3,826 Finished goods 4,499 4,751 Total inventories 26,147 24,983 Deferred taxes 3,076 2,873 Other current assets 911 1,210 TOTAL CURRENT ASSETS 61,075 64,146 PROPERTY, PLANT AND EQUIPMENT - NET 23,362 22,129 INTANGIBLE ASSETS - NET AND OTHER LONG-TERM ASSETS 1,344 1,386 $85,781 $87,661 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable and accrued liabilities $15,131 $18,245 Income taxes currently payable 390 872 Line-of-credit 17,132 20,451 Current portion of long-term debt 136 136 TOTAL CURRENT LIABILITIES 32,789 39,704 LONG-TERM DEBT, less current portion 2,008 2,036 DEFERRED TAXES 820 828 OTHER LONG-TERM LIABILITIES 388 368 36,005 42,936 SHAREHOLDERS' EQUITY: Common Stock, $.10 par, authorized shares 24,000,000; issued shares of 9,552,388 on 09/29/95 and 9,450,272 on 06/30/95 955 945 Additional paid-in capital 19,327 16,915 Retained earnings 29,523 26,891 Translation adjustment (13) (7) Net unrealized loss on marketable securities (16) (19) 49,776 44,725 $85,781 $87,661 Note: The Balance sheet at June 30, 1995 has been derived from audited financial statements at that date. See notes to consolidated condensed financial statements.
C-COR Electronics, Inc. Consolidated Condensed Statements of Income (Unaudited)
Thirteen-Weeks Ended September 29 September 23 1995 1994 (000's omitted, except per share data) NET SALES $39,640 $27,554 COSTS AND EXPENSES: Costs of sales 28,809 18,869 Selling, general and administrative expense 4,680 3,946 Research and product development costs 1,950 1,408 Interest expense 375 23 Investment income (13) (2) Foreign exchange gain (224) (206) Other expenses 25 116 35,602 24,154 INCOME BEFORE INCOME TAXES 4,038 3,400 INCOME TAXES 1,407 1,205 NET INCOME $ 2,631 $ 2,195 EARNINGS PER SHARE: Primary $ .27 $ .23 Fully diluted $ .27 $ .23 Note: Earnings per share amounts have been adjusted to reflect a two-for-one stock split effective December 5, 1994. See notes to consolidated condensed financial statements.
C-COR Electronics, Inc. Consolidated Condensed Statements of Cash Flows (Unaudited)
Thirteen-Weeks Ended September 29 September 23 1995 1994 (000's omitted) OPERATING ACTIVITIES Net Income $ 2,631 $ 2,195 Adjustments to reconcile net income to net cash and cash equivalents provided by (used in) operating activities: Depreciation and amortization 1,318 883 Provision for doubtful accounts (34) 53 Provision for deferred income tax benefit (211) (399) Provision for deferred retirement salary plan 20 23 Tax benefit of premature sales of incentive stock option shares 1,593 0 Issue common stock to employee stock purchase plan 24 9 Loss on sale of marketable securities 0 45 Gain on sale of propoerty, plant and equipment (2) (1) Changes in operating assets and liabilities: Accounts receivable 3,618 (2,943) Inventories (1,164) (3,395) Other assets 288 (106) Accounts payable (1,649) (859) Accrued liabilities (1,471) (413) Income taxes recoverable 0 (7) Income taxes payable (482) 1,081 NET CASH AND CASH EQUIVALENTS PROVIDED BY (USED IN) OPERATING ACTIVITIES 4,479 (3,834) INVESTING ACTIVITIES Purchase of property, plant and equipment (2,498) (3,485) Proceeds from sale of property, plant and equipment 2 2 Proceeds from sale of marketable securities 0 1,872 Proceeds from maturity of marketable securities 20 80 NET CASH AND CASH EQUIVALENTS USED IN INVESTING ACTIVITIES (2,476) (1,531) FINANCING ACTIVITIES Payment of debt and capital lease obligations (28) (14) Proceeds from line-of-credit 15,930 8,737 Payment of line-of-credit (19,249) (5,065) Proceeds from exercise of stock options 805 199 NET CASH AND CASH EQUIVALENTS (USED IN) PROVIDED BY FINANCING ACTIVITIES (2,542) 3,857 DECREASE IN CASH AND CASH EQUIVALENTS (539) (1,508) Cash and cash equivalents at beginning of period 1,545 1,361 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 1,006 $ (147) See notes to consolidated condensed financial statements.
C-COR ELECTRONICS, INC. NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS 1. The accompanying, unaudited, consolidated condensed financial statements have been prepared in accordance with generally-accepted accounting principles for interim financial information, and in the opinion of management, contain all adjustments necessary to fairly present the Company's financial position as of September 29, 1995 and the results of its operations for the thirteen-week period then ended. Operating results for the thirteen-week period are not necessarily indicative of the results that may be expected for the year ending June 28, 1996. For further information, refer to financial statements and footnotes thereto included in the Company's annual report on Form 10-K for the year ended June 30, 1995. 2. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES Accounts payable and accrued liabilities consist of:
September 29 June 30 1995 1995 (000's omitted) Accounts payable $ 7,638 $ 9,286 Accrued incentive plan expense 1,115 2,416 Accrued vacation expense 1,310 1,295 Accrued salary expense 1,348 819 Accrued warranty expense 1,843 1,754 Accrued other 1,877 2,675 $15,131 $18,245
Item 2. Management's Discussion and Analysis of Financial Conditions and Results of Operations. Results of Operations Net sales for the thirteen-week period ended September 29, 1995 were $39,640,000. This represents an increase of 44% over last fiscal year's sales of $27,554,000 for the same period. The increased sales for the first quarter versus the same period of last year were attributable to increased sales of RF amplifiers and AM fiber optic products to cable television (CATV) operators and telephone companies worldwide. Telecommunications reform legislation is still pending in the U.S. Congress as of September 29, 1995. This legislation is aimed at deregulating the domestic communications industry, bringing the benefits of competition to telephone and video services. It is anticipated that passage of this legislation may have a positive revenue impact on C-COR and other suppliers of telecommunication equipment because of enhanced competition and a reduction in regulatory uncertainty. The timing and extent of the anticipated positive impact are currently unknown. International sales accounted for 51% of total consolidated sales for the quarter ended September 29, 1995. This compares to 36% for the same period the prior fiscal year. Strong sales to Canada combined with an expanding international marketplace, especially in Asia, Europe, and Latin America resulted in an increased demand for the Company's products outside the U.S. Gross profit percentage for the first quarter of fiscal year 1996 was 27.3% versus 31.5% for the same period the prior fiscal year. Increases in fixed manufacturing overhead costs as a result of expansion of facilities and personnel accounted for a portion of the gross profit percentage decrease over the prior year. Manufacturing variances charged directly to cost-of-sales were also higher in the first quarter of fiscal year 1996 versus the same period last year due to increased training costs and other expenses associated with the ramp-up in production. In addition, expense was and will continue to be incurred during fiscal year 1996 associated with the contracting of an outside consulting group to assist with improving productivity and efficiency in C-COR's order fulfillment and material procurement processes. Selling, general and administrative expense for the first quarter of fiscal year 1996 was $4,680,000. This is up 18.6% over last year's total of $3,946,000 for the same period. The increase is primarily due to expansion of the Company's sales group to address new market opportunities and additions to administrative personnel to support increased business activity. As a percent of net sales, however, selling, general and administrative expense decreased by approximately 2.5% to 11.8% in the first quarter of fiscal year 1996, versus 14.3% for the same period of the prior year. Research and product development costs for the first quarter of fiscal year 1996 were $1,950,000. This represents a 38.4% increase over the same period of the prior year. The increase is attributable to the expansion of the Company's engineering personnel and resources, especially in the area of fiber optic product development. Research and product development costs were 4.9% of net sales in the first quarter of fiscal year 1996, versus 5.1% for the same period of the previous year. Interest expense was $375,000 for the first quarter of fiscal year 1996. The increase over the total for the same period of last fiscal year is due to borrowings on the Company's line-of-credit for expansion of manufacturing capabilities and facilities, which began in the prior fiscal year. Renovations are currently nearing completion at the Company's headquarters, located in State College, Pennsylvania. A foreign currency exchange gain of $224,000 was recorded in the first quarter of fiscal year 1996 versus a gain of $206,000 in the same period of the prior fiscal year. The exchange gain was primarily attributable to the strengthening of the Canadian dollar relative to the U.S. dollar during the first quarter of fiscal year 1996. Liquidity and Sources of Capital Cash and cash equivalents as of September 29, 1995 totaled $1,006,000. Principal sources of cash in the first quarter of fiscal year 1996 were from operating activities which generated $4,479,000. The Company's current ratio increased to 1.9 at September 29, 1995, up from 1.6 at June 30, 1995. The Company closed on two low interest mortgages on October 24, 1995. The Company anticipates receiving all mortgage funds in the second quarter of fiscal year 1996. The first source of funding is through the Pennsylvania Industrial Development Authority (PIDA), for $1,952,000, at an interest rate of 2%. This represents 40% of the cost of the new 90,000 square foot facility at the Company's headquarters in State College, Pennsylvania. Monthly payments of principal and interest will be required through the year 2010 (fifteen years). The second source of mortgage funding is through the Pennsylvania "Sunny Day Fund" for $4,499,000, also at an interest rate of 2%. This funding will be evidenced by two notes, the first of which is for $488,000 maturing in approximately fifteen years, and the other for $4,011,000 with a maturity up to seven years, for the purchase of new equipment. The Company maintains a line-of-credit with a bank which can be drawn upon up to a maximum of $23,000,000, contingent on sufficient collateral in accounts receivable as outlined in a revolving credit agreement. The Company had a balance of $17,132,000 drawn on this line-of-credit at the end of the first quarter of fiscal year 1996, down $3,319,000 from the end of the prior fiscal year. The borrowings, as mentioned earlier, resulted from expansion of manufacturing capability and facility improvements which started during the prior fiscal year. Borrowings on this line-of-credit will be offset upon receipt of the mortgage funding previously discussed. Management perceives that operating cash flow as well as the aforementioned financing source, will adequately provide for all cash requirements for the immediate future subject to requirements that additional growth or strategic development might dictate. EX-11 2 COMPUTATION OF EARNINGS PER SHARE STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
Thirteen-Weeks Ended September 29 September 23 1995 1994 (000's omitted, except per share data) PRIMARY Weighted Average Shares Outstanding 9,490 9,222 Net effect of dilutive stock options-based on the treasury stock method using average market price 413 410 Total(1) 9,903 9,632 Net income $ 2,631 $ 2,195 Net income per share(1) $ 0.27 $ 0.23 FULLY DILUTED Weighted Average Shares Outstanding 9,490 9,222 Net effect of dilutive stock options-based on the treasury stock method using the greater of the average market price or period end market price 413 491 Total(1) 9,903 9,713 Net income $ 2,613 $ 2,195 Net income per share(1) $ 0.27 $ 0.23 (1) Adjusted to reflect a two-for-one stock split effective December 5, 1994.
Item 6. Exhibits and Reports on Form 8-K. The following exhibit is included herein: (11) Statement re: computation of earnings per share The Company did not file any reports on Form 8-K during the thirteen- week period ended September 29, 1995. EX-27 3 ART. 5-FDS FOR 1ST QUARTER 10-Q
5 1,000 3-MOS JUN-28-1996 SEP-29-1995 1,006 377 30,087 624 26,147 61,075 38,434 15,072 85,781 32,789 0 955 0 0 19,327 85,781 40,011 40,011 28,809 6,630 (212) 0 375 4,038 1,407 2,631 0 0 0 2,631 0.27 0.27
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