-----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, E3qzkFSLd5QIkWITa/9epUTPDWyOkULml6bzHWRlDxHvaZxx8YkzjF0mIwvBPFuZ CaurV8vuCkARg2Dfi9UZBQ== 0000056151-97-000002.txt : 19970311 0000056151-97-000002.hdr.sgml : 19970311 ACCESSION NUMBER: 0000056151-97-000002 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970131 FILED AS OF DATE: 19970310 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: 97553777 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 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, 1997 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 (562)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, 1997. 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, 1997 1996 Sales $16,589 $17,971 Cost of sales 15,257 16,017 Selling, general and administrative 1,887 1,943 17,144 17,960 Operating (loss) (555) 11 Other income Interest income, net 9 - (Loss) income before income (546) 11 (Benefit) provision for (Note A) (224) 4 Net (loss) income ($322) $7 Shares outstanding (Note B) 1,110,934 1,110,934 Net (loss) income per share (Note B) ($0.29) $0.01 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 1997 1996 (Unaudited) ASSETS Cash and cash $2,415 $2,281 Accounts receivable, net 4,908 8,026 Inventories: Raw materials 3,650 3,424 Work in process 1,162 1,234 Finished goods 5,751 2,511 Total inventories 10,563 7,169 Prepaids and deferred income 1,806 1,241 Total current assets 19,692 18,717 Property, plant and equipment, net 6,673 6,319 Other assets 107 103 Total assets $26,472 $25,139 LIABILITIES AND SHAREHOLDERS' EQUITY Note payable to bank $3,300 Accounts payable 3,458 $3,685 Accrued payroll and related 1,231 2,256 Accrued marketing programs 1,383 1,104 Accrued expenses 1,016 1,664 Income taxes payable 24 Total current liabilities 10,388 8,733 Deferred income taxes 1,469 1,469 Total liabilities 11,857 10,202 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 13,345 11,914 Net (loss) income for (322) 1,431 Balance at end of period 13,023 13,345 Total shareholders' equity 14,615 14,937 Total liabilities and shareholders' equity $26,472 $25,139
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 1997 1996 Cash flows from operating activities: Cash received from customers $19,708 $19,186 Interest received 15 6 Cash received from operations 19,723 19,192 Cash paid to suppliers and employees 21,990 20,633 Interest paid 7 7 Income taxes paid 35 190 Cash disbursed for operations 22,032 20,830 Net cash used in operating activities (2,309) (1,638) Net cash used in operating activities Cash flows from investing activities: Purchase of property, plant and equipment (699) (110) Changes in other current and non-current (158) (219) Net cash used in investing activities (857) (329) Cash flows from financing activities: Proceeds from line-of-credit borrowings 3,300 1,200 Net cash provided by financing activities 3,300 1,200 Net increase (decrease) in cash 134 (767) Cash at beginning of year 2,281 2,218 Cash at end of period $2,415 $1,451 Cash at end of period Reconciliation of net (loss) income to net cash used in operating activities: Net (loss) income ($322) $7 Adjustments to reconcile net (loss) income to net cash used in operating activities Depreciation 169 169 Decrease in accounts receivable 3,118 1,215 Increase in inventories (3,394) (2,023) Decrease in accounts payable and accrued (1,621) (820) Decrease in income taxes payable (259) (186) Net cash used in operating activities ($2,309) ($1,638) 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, 1997 COMPARED TO OCTOBER 31, 1996 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 decreased $680,000 due to the decrease in accounts receivable because of the decline in sales during the first quarter. The current ratio was 1.9:1 at January 31, 1997 and 2.1:1 at October 31, 1996. 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, 1997 COMPARED TO QUARTER ENDED JANUARY 31, 1996 Total sales for the quarter ended January 31, 1997 were $16,589,000, an 8% decrease from sales of $17,971,000 for the same quarter of the prior year. The decrease consisted of a 37% increase in manufactured housing sales and a 20% decrease in recreational vehicle sales. RV sales saw a decrease as a result of dealers adjusting their inventories because of a significant slowdown in retail activity due to extremely bad weather conditions in the Northwestern sales region. In addition, because of the increase in competitive market conditions, p r i ce reductions were implemented. Manufactured housing sales increased due to increased marketing efforts and more competitive product pricing. Also, this division s sales were favorably impacted by a wider range of product offerings and an overall increase in the dealer base. Cost of sales decreased 5% from the same quarter of the prior year due primarily to the decline in sales volume, but increased 3% as a percent of sales. The decline in gross profit margins compared to the first quarter of fiscal 1996 is chiefly attributed to competitive pricing moves in both the RV and manufactured housing divisions. Selling, general and administrative expenses decreased 3% over the same quarter of the prior year and rose 1% as a percent of sales. The increase was due to increases in marketing costs. Net interest income for the current quarter increased in comparison to net interest expense in the same quarter of the prior year. This was a consequence of an increase in the average net short-term investments. The net loss for the three months ended January 31, 1997 was $322,000, or $0.29 per share, compared to net income of $7,000, or $0.1 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, 1997. - 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 2/28/97 /s/ Dan Pocapalia Dan Pocapalia Chairman of the Board, Chief Executive Officer and President (Principal Executive Officer) DATE 2/28/97 /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
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-31-1997 JAN-31-1997 2,415,000 0 4,908,000 43,000 10,563,000 19,692,000 12,279,000 5,606,000 26,472,000 10,388,000 0 0 0 1,592,000 0 26,472,000 16,589,000 16,589,000 15,257,000 17,135,000 0 0 0 (546,000) (224,000) (322,000) 0 0 0 (322,000) (.29) (.29)
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