-----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, AMU1F5iYAswy5gX5tX5rKsh2TSPtWEqSklJ6prswvBwEBoEY1GUfxLHXkT7mNC+Z e6RXmKrFM7h/ws/JsDYtnQ== 0000056151-96-000003.txt : 19960312 0000056151-96-000003.hdr.sgml : 19960312 ACCESSION NUMBER: 0000056151-96-000003 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960131 FILED AS OF DATE: 19960311 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: KIT MANUFACTURING CO CENTRAL INDEX KEY: 0000056151 STANDARD INDUSTRIAL CLASSIFICATION: MISCELLANEOUS TRANSPORTATION EQUIPMENT [3790] IRS NUMBER: 951525261 STATE OF INCORPORATION: CA FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-06257 FILM NUMBER: 96533504 BUSINESS ADDRESS: STREET 1: 530 E WARDLOW RD STREET 2: P O BOX 848 CITY: LONG BEACH STATE: CA ZIP: 90801 BUSINESS PHONE: 3105957451 MAIL ADDRESS: STREET 1: 530 EAST WARDLOW ROAD CITY: LONG BEACH STATE: CA ZIP: 90801 10-Q 1 FORM 10Q FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For Quarter Ended January 31, 1996 Commission file number 2-31520 KIT MANUFACTURING COMPANY (Exact name of registrant as specified in its charter) California 95-1525261 (State or other jurisdiction of (I.R.S.Employer incorporation or organization) Identification No.) 530 East Wardlow Road,P.O. Box 848,Long Beach,California 90801 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (310)595-7451 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 close of the period covered by this report. Common Stock (no par value), 1,110,934 shares outstanding as of January 31, 1996. Index to Exhibits - Page 10 1 of 10 Pages

PART I FINANCIAL INFORMATION - 2 -

KIT Manufacturing Company STATEMENTS OF INCOME (Dollars in Thousands Except Per Share Amounts) (Unaudited)
Three Months Ended January 31, 1996 1995 Sales $17,971 $21,851 Costs and Cost of sales 16,017 19,643 Selling, general and administrative 1,943 1,793 17,960 21,436 Operating income 11 415 Other income Interest income, net - 29 Income before income taxes 11 444 Provision for income taxes (Note A) 4 182 Net income $7 $262 Average shares outstanding (Note B) 1,110,934 1,110,934 Net income per share (Note B) $0.01 $0.24 Dividends per share $ - $ - The accompanying notes are an integral part of these financial statements -3-

KIT MANUFACTURING COMPANY BALANCE SHEETS (Dollars in thousands)
January 31, October 1996 1995 ASSETS (Unaudited) Cash and cash $1,451 $2,218 Accounts receivable, net 6,135 7,350 Inventories: Raw materials 3,200 2,543 Work in process 1,238 1,055 Finished goods 3,252 2,069 Total inventories 7,690 5,667 Prepaids and deferred income 1,479 1,589 Total current assets 16,755 16,824 Property, plant and equipment, net 6,321 6,388 Other assets 164 90 Total assets $23,240 $23,302 LIABILITIES AND SHAREHOLDERS' Note payable to bank $1,200 Accounts payable 3,727 $3,954 Accrued payroll and related 1,167 2,203 Accrued marketing programs 1,018 741 Accrued expenses 1,153 1,309 Income taxes payable 63 190 Total current 8,328 8,397 Deferred income taxes 1,399 1,399 Total liabilities 9,727 9,796 Commitments and contingencies Shareholders' equity Common stock and additional paid-in capital, issued and outstanding 1,110,934 shares 1,592 1,592 Retained earnings: Balance at beginning of period 11,914 10,565 Net income for period 7 1,349 Balance at end of period 11,921 11,914 Total shareholders' equity 13,513 13,506 Total liabilities and shareholders' equity $23,240 $23,302 The accompanying notes are an integral part of these financial statements -4-

KIT MANUFACTURING COMPANY STATEMENTS OF CASH FLOWS (Dollars in thousands) (Unaudited)
For the 3 months ended January 31, 1996 1995 Cash flows from operating activities: Cash received from customers $19,186 $21,840 Interest received 6 37 Cash received from operations 19,192 21,877 Cash paid to suppliers and employees 20,633 25,332 Interest paid 7 8 Income taxes paid 190 132 Cash disbursed for operations 20,830 25,472 Net cash used in operating activities (1,638) (3,595) Net cash used in operating activities Cash flows from investing activities: Purchase of property, plant and equipment (110) (181) Changes in other current and non-current assets (219) (140) Net cash used in investing activities (329) (321) Cash flows from financing activities: Proceeds from line-of-credit borrowings 1,200 700 Net cash provided by financing activities 1,200 700 Net decrease in cash (767) (3,216) Cash at beginning of year 2,218 4,625 Cash at end of period $1,451 $1,409 Cash at end of period Reconciliation of net income to net cash used in operating activities: Net income $7 $262 Adjustments to reconcile net income to net cash used in operating Depreciation 169 136 (Increase) decrease in accounts 1,215 (11) Increase in inventories (2,023) (2,757) Decrease in accounts payable and accrued liabilities (820) (1,275) Increase (decrease) in income taxes payable (186) 50 Net cash used in operating activities ($1,638) ($3,595) Net cash used in operating activities The accompanying notes are an integral part of these financial statements -5-

KIT MANUFACTURING COMPANY NOTES TO CONDENSED FINANCIAL STATEMENTS (Unaudited) Note A - The provision or benefit for income taxes is calculated using the Company's estimated annual effective tax rate. Note B - Per share amounts are based on the weighted average number of common shares outstanding. Common stock equivalents have not been included in the computations because their effect would not be dilutive. Note C - During the period reported on, there were no sales of securities. Note D - In the opinion of management, all material adjustments which are necessary for a fair statement of financial position, results of operations and cash flows have been included in these financial statements. Note E - The results of the period are not necessarily indicative of annual results due to seasonality of the business. Note F - Financial information contained herein is unaudited. Note G - The Company is contingently liable to various financial institutions on repurchase agreements in connection with wholesale inventory financing. In general, inventory is repurchased by the Company upon default by a dealer with a financing institution and then resold through normal distribution channels. In addition, the Company is contingently liable to financial institutions for letters of credit which were established to satisfy the self-insured workers' compensation regulations of the states in which the Company conducts manufacturing operations. Management does not expect that losses, if any, from the contingencies described above will be of material importance to the financial condition or earnings of the Company. - 6 -

KIT MANUFACTURING COMPANY Management's Discussion and Analysis of Financial Condition and Results of Operations FINANCIAL CONDITION - JANUARY 31, 1996 COMPARED TO OCTOBER 31, 1995 Under first quarter market conditions, the Company borrowed on its line of credit to increase its inventories to prepare for the spring selling season. The Company's working capital remained unchanged due to the increase in inventories and a decrease in accounts receivable due to the decrease in sales. The current ratio was 2.0:1 at January 31, 1996 and at October 31, 1995. The Company's liquidity position as reflected in the current ratio described above, capital resources, including excess plant capacity, working capital, and line of credit, are considered to be adequate to provide for near term anticipated growth. RESULTS OF OPERATIONS - QUARTER ENDED JANUARY 31, 1996 COMPARED TO QUARTER ENDED JANUARY 31, 1995 Total sales for the quarter ended January 31, 1996 were $17,971,000, an 18% decrease from sales of $21,851,000 for the same quarter of the prior year. The decrease consisted of a 49% decrease in manufactured housing sales and a 1% decrease in recreational vehicle sales. RV sales saw an decrease as a result of dealers adjusting their inventories from prior year levels. Manufactured housing sales declined due to extremely bad weather conditions not encountered during the previous comparable quarter causing a significant slowdown in retail sales. Cost of sales decreased 18% from the same quarter of the prior year due primarily to the decline in sales volume, but decreased 1% as a percent of sales. The increase in gross profit margins is chiefly attributed to increased sales of higher margin RV s compared to the first quarter of fiscal 1995. Selling, general and administrative expenses increased 8% over the same quarter of the prior year and rose 3% as a percent of sales. The increase was due to increases in marketing costs. Net interest expense for the current quarter increased in comparison to net interest income in the same quarter of the prior year. This was a consequence of a decrease in the average net short-term investments. Net income for the three months ended January 31, 1996 was $7,000, or $0.01 per share, compared to net income of $262,000, or $0.24 per share, for the same quarter of the prior year. -7-

PART II OTHER INFORMATION Item 6 (a). See Index to Exhibits on page 10. Item 6 (b). Form 8-K was not required to be filed during the quarter ended January 31, 1996. - 8 -

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. KIT MANUFACTURING COMPANY (Registrant) DATE 3/11/96 /S/ Dan Pocapalia Dan Pocapalia Chairman of the Board, Chief Executive Officer and President (Principal Executive Officer) DATE 3/11/96 /s/ Dale J. Gonzalez Dale J. Gonzalez Senior Vice President and Treasurer (Principal Financial and Accounting Officer) - 9 -

KIT MANUFACTURING COMPANY INDEX TO EXHIBITS Item: (27) Financial Data Schedule - 10 - EX-27 2 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM SEC FORM 10Q AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 3-MOS OCT-31-1996 JAN-31-1996 1451 0 6179 (44) 7690 16755 11441 (5120) 23240 8328 0 0 0 1592 0 23240 17971 17971 16017 17960 0 0 0 11 4 7 0 0 0 7 .01 0
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