-----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, A5kf5dDWdQYoHHvLZ8NwnqyXcfcxLDQ4auaTrDkiDIPCDgo61QFAFmjSAVTaL812 PoeAKLgjvK4h0lVeT5opSw== /in/edgar/work/20001103/0000926044-00-000139/0000926044-00-000139.txt : 20001106 0000926044-00-000139.hdr.sgml : 20001106 ACCESSION NUMBER: 0000926044-00-000139 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000930 FILED AS OF DATE: 20001103 FILER: COMPANY DATA: COMPANY CONFORMED NAME: KNAPE & VOGT MANUFACTURING CO CENTRAL INDEX KEY: 0000056362 STANDARD INDUSTRIAL CLASSIFICATION: [2540 ] IRS NUMBER: 380722920 STATE OF INCORPORATION: MI FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-01859 FILM NUMBER: 752265 BUSINESS ADDRESS: STREET 1: 2700 OAK INDUSTRIAL DR NE CITY: GRAND RAPIDS STATE: MI ZIP: 49505 BUSINESS PHONE: 6164593311 MAIL ADDRESS: STREET 1: 2700 OAK INDUSTRIAL DRIVE, NE CITY: GRAND RAPIDS STATE: MI ZIP: 49505 10-Q 1 0001.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended September 30, 2000 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 2-18868 KNAPE & VOGT MANUFACTURING COMPANY (Exact name of registrant as specified in its charter) Michigan 38-0722920 (State of Incorporation) (IRS Employer Identification No.) 2700 Oak Industrial Drive, NE Grand Rapids, Michigan 49505 (Address of principal executive offices) (Zip Code) (616) 459-3311 (Telephone Number) 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 ______ 2,257,361 common shares were outstanding as of October 27, 2000. 2,359,778 Class B common shares were outstanding as of October 27, 2000. The Exhibit Index appears on page 14. KNAPE & VOGT MANUFACTURING COMPANY AND SUBSIDIARIES INDEX Page No. PART I. FINANCIAL INFORMATION Item 1. Financial Statements. Condensed Consolidated Balance Sheets --September 30, 2000 and July 1, 2000.............................2 Condensed Consolidated Statements of Income --Three Months Ended September 30, 2000 and October 2, 1999.......3 Condensed Consolidated Statements of Cash Flows --Three Months Ended September 30, 2000 and October 2, 1999.......4 Notes to Condensed Consolidated Financial Statements............5-7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations............................8-10 Item 3. Quantitative and Qualitative Disclosures About Market Risk.......11 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K.................................12 SIGNATURES....................................................................13 EXHIBIT INDEX ................................................................14 1 KNAPE & VOGT MANUFACTURING COMPANY AND SUBSIDIARIES PART I. FINANCIAL INFORMATION CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Audited) Sept. 30, 2000 July 1, 2000 -------------------- ----------------- Assets Current assets Cash and equivalents $ 2,213,185 $ 2,351,622 Accounts receivable - net 18,820,466 20,631,951 Inventories 16,672,564 15,092,393 Prepaid expenses and other 3,067,661 3,133,098 ------------------- ---------------- Total current assets 40,773,876 41,209,064 ------------------- ---------------- Property, plant and equipment 76,181,490 73,632,488 Less accumulated depreciation 36,668,374 35,270,625 ------------------- ---------------- Net property, plant and equipment 39,513,116 38,361,863 ------------------- ---------------- Goodwill 4,896,401 4,978,420 Other assets 4,055,595 3,738,305 ------------------- ---------------- $ 89,238,988 $ 88,287,652 =================== ================ Liabilities and Stockholders' Equity Current liabilities Accounts payable $ 11,973,262 $ 12,833,665 Other accrued liabilities 11,461,140 11,997,006 ------------------- ---------------- Total current liabilities 23,434,402 24,830,671 ------------------- ---------------- Long-term debt 20,570,000 20,050,000 Deferred income taxes and other long-term liabilities 8,863,515 8,700,351 ------------------- ---------------- Total liabilities 52,867,917 53,581,022 ------------------- ---------------- Stockholders' Equity Common stock (Common - 2,227,581 and 2,222,852 shares issued, Class B common - 2,388,095 and 2,392,853 shares issued, Preferred - unissued) 9,231,352 9,231,410 Additional paid-in capital 8,480,730 8,482,908 Unearned stock grant (94,500) (94,500) Accumulated other comprehensive income: Foreign currency translation adjustment (72,289) (39,172) Derivative adjustment 244,019 - Minimum supplemental executive retirement plan liability adjustment (1,129,818) (1,130,405) Retained earnings 19,711,577 18,256,389 ------------------- ---------------- Total stockholders' equity 36,371,071 34,706,630 ------------------- ---------------- $ 89,238,988 $ 88,287,652 =================== ================
See accompanying notes. 2 KNAPE & VOGT MANUFACTURING COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) Three Months Ended ------------------ Sept. 30, 2000 Oct. 2, 1999 ---------------- ---------------- Net sales $ 36,957,550 $ 35,687,624 Cost of sales 26,383,824 26,294,114 ----------------- ----------------- Gross profit 10,573,726 9,393,510 Selling and administrative expenses 6,766,146 5,897,749 ----------------- ----------------- Operating income 3,807,580 3,495,761 Other expenses (income) 436,685 317,949 ----------------- ----------------- Income before income taxes 3,370,895 3,177,812 Income taxes 1,190,000 1,133,000 ----------------- ----------------- Net income $ 2,180,895 $ 2,044,812 ================= ================= Basic earnings per share: Net income per share $ 0.47 $ 0.43 ================= ================= Weighted average shares outstanding 4,615,000 4,720,283 Diluted earnings per share: Net income per share $ 0.47 $ 0.43 ================= ================= Weighted average shares outstanding 4,619,016 4,725,952 Cash dividend - common stock $ .165 $ .15 Cash dividend - Class B common stock $ .15 $ .136
See accompanying notes. 3 KNAPE & VOGT MANUFACTURING COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Three Months Ended ------------------ Sept. 30, 2000 Oct. 2, 1999 ------------------- ------------------- Operating Activities: Net income $ 2,180,895 $ 2,044,812 Non-cash items: Depreciation and amortization 1,538,556 1,410,100 Deferred income taxes (70,000) (65,000) Other long-term liabilities 100,932 98,778 Changes in operating assets and liabilities: Accounts receivable 1 ,787,816 (406,632) Inventories (1,580,171) 951,778 Other current assets 63,185 44,114 Accounts payable and accrued expenses (1,721,769) 1,139,374 ---------------- --------------- Net cash provided by operating activities 2,299,444 5,217,324 ---------------- --------------- Investing Activities: Additions to property, plant and equipment (2,195,587) (1,947,282) Net cash paid for acquisition - (5,267,877) Payments for other non-current assets (1,059) 120,001 ---------------- --------------- Net cash provided by (used for) investing activities (2,196,646) (7,095,158) ---------------- --------------- Financing Activities: Cash dividends paid (725,707) (672,671) Proceeds from issuance of common stock 3,903 180,999 Repurchase and retirement of common stock (20,537) (806,992) Borrowings on long-term debt 14,790,000 6,550,000 Payments on long-term debt (14,270,000) (3,200,000) ---------------- --------------- Net cash provided by (used for) financing activities (222,341) 2,051,336 ---------------- --------------- Effect of Exchange Rate Changes on Cash (18,894) 2,075 ---------------- --------------- Net Increase in Cash and Equivalents (138,437) 175,577 Cash and equivalents, beginning of year 2,351,622 1,621,002 ---------------- --------------- Cash and equivalents, end of period $ 2,213,185 $ 1,796,579 ================ =============== Cash Paid During the Period - interest $ 372,418 $ 314,987 - income taxes $ 285,000 $ 10,000
See accompanying notes. 4 KNAPE & VOGT MANUFACTURING COMPANY AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note 1 - Basis of Financial Statement Preparation The accompanying unaudited condensed consolidated financial statements and related notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. The information furnished reflects all adjustments, which are, in the opinion of management, necessary for a fair statement of the results of operations and consist of only normal recurring adjustments. Interim results are not necessarily indicative of the results for the year-end and are subject to year-end adjustments, and audit by independent public accountants. The balance sheet at July 1, 2000, has been taken from the audited financial statements at that date. The condensed consolidated financial statements and notes should be read in conjunction with the Company's 2000 annual report. Effective July 1, 1999, the Company adopted a 52- or 53-week fiscal year, changing the year-end date from June 30 to the Saturday nearest the end of June. Certain prior year information has been reclassified to conform to the current year presentation. Note 2 - Common Stock and Per Share Information Common stock is $2 par - shares authorized 6,000,000 of common stock and 4,000,000 of Class B common stock. The following table reconciles the numerators and denominators used in the calculations of basic and diluted EPS for each of the periods presented: Sept. 30, 2000 Oct. 2, 1999 ------------------- ------------------ Numerators: Numerator for both basic and diluted EPS, net income $2,180,895 $2,044,812 =================== ================== Denominators: Denominator for basic EPS, weighted-average common shares outstanding 4,615,000 4,720,283 Potentially dilutive shares resulting from stock option plans 4,016 5,669 ------------------- ------------------ Denominator for diluted EPS 4,619,016 4,725,952 =================== ==================
The following exercisable stock options were not included in the computation of diluted EPS because the option prices were greater than average quarterly market prices. Sept. 30, 2000 Oct. 2, 1999 ------------------- ------------------ Exercise Price $16.74 11,192 11,495 $18.18 10,450 11,000
5 Note 3 - Inventories Inventories are valued at the lower of FIFO (first-in, first-out) cost or market. Inventories are summarized as follows: Sept. 30, 2000 July 1, 2000 -------------- ------------ Finished products $ 10,797,897 $ 8,778,556 Work in process 2,262,154 2,339,958 Raw materials 3,612,513 3,973,879 -------------- --------------- Total $ 16,672,564 $ 15,092,393 ============== ===============
Note 4 - Adoption of New Accounting Standard The Company adopted Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities," on July 2, 2000. The Company uses an interest-rate swap to convert a portion of its variable-rate revolver to a fixed rate. The resulting cost of funds is lower than it would have been had fixed-rate borrowings been issued directly. The level of fixed-rate debt, after the effects of interest-rate swaps have been considered, is between 85 and 95 percent of the Company's total outstanding debt of $20,570,000 at September 30, 2000 and $20,050,000 at July 1, 2000. In accordance with the transition provisions of FAS 133, the Company recorded a net-of-tax cumulative-effect-type adjustment in accumulated other comprehensive income to recognize the fair value of the interest-rate swap designated as a cash-flow hedging instrument. The derivative was also recognized on the balance sheet at its fair value of $375,019. The Company has formally documented the relationship between the interest-rate swap and the revolver, as well as its risk-management objective and strategy for undertaking the hedge transaction. This process includes linking the derivative that has been designated as a cash-flow hedge to the specific liability on the balance sheet. The Company also formally assesses, both at the hedge's inception and on an ongoing basis, whether the derivative used in the hedging transaction is highly effective in offsetting changes in the cash flows of the hedged item. If it is determined that the derivative is not highly effective as a hedge or that it has ceased to be a highly effective hedge, the Company will discontinue hedge accounting prospectively. Note 5 - Comprehensive Income Comprehensive income is comprised of net income and all changes to stockholders' equity, except those due to investments by owners and distributions to owners. Comprehensive income and its components consist of the following: Three months ended Sept. 30, 2000 Oct. 2, 1999 - ----------------------------------------------------------------------------------- Net income $ 2,180,895 $ 2,044,812 Other comprehensive income: Foreign currency translation adjustment (33,287) (1,016) Derivative adjustment 244,019 - Minimum SERP liability adjustment 757 68 ----------------- ---------------- Comprehensive income $ 2,392,384 $ 2,043,864 ================= ================
6 Note 6 - Assets Held for Sale During fiscal 2000, the Company offered its former powder coat facility for sale. As a result of this decision, the related assets of $1,779,405 were transferred to the category "Net Assets Held for Sale" and a loss of $105,000 was recorded in the fourth quarter of fiscal 2000. In July 2000, management entered into a Buy/Sell agreement for the facility and anticipates closing the sale during fiscal 2001. The loss was determined based upon this Buy/Sell agreement. Note 7 - Acquisition On October 1, 1999, the Company acquired substantially all of the assets of Idea Industries, Inc. (Idea). Idea designed, manufactured and marketed ergonomic products, including adjustable keyboard mechanisms, keyboard and computer mouse platforms, wrist rests and CPU holders. The acquisition was recorded using the purchase method of accounting. Accordingly, the purchase price was allocated to the assets acquired and liabilities assumed, based on the estimated fair values at the date of the acquisition. The cost of the acquisition in excess of net identifiable assets acquired has been recorded as goodwill and is being amortized on a straight-line basis over 15 years. The terms of the Idea acquisition agreement provide for additional consideration to be paid if Idea's sales exceed certain targeted levels. The maximum amount of contingent consideration is $550,000 payable through 2001. In calendar year 1999, the additional consideration payment was $41,797, which has been included in goodwill. Any additional consideration paid will be recorded as goodwill when payment is made. The results of the acquisition were not material to the Company's consolidated operating results, therefore pro forma financial statements have not been prepared. Note 8 - Restricted Stock and Performance-Option Plan On February 1, 2000, William Dutmers, Chairman of the Board, President and Chief Executive Officer of Knape & Vogt, was granted 6,600 shares of restricted common stock and the option to purchase an additional 27,500 shares of the Company's common stock at a price of $14.43 per share. The grant and the options will vest if the Company achieves specific financial objectives within a five-year performance period. During the performance period, the grantee may vote and receive dividends on the restricted shares, but the shares are subject to transfer restrictions and are forfeited if the grantee terminates employment or the Company does not achieve its financial objectives. Note 9 - Stock Repurchase On September 1, 1998, the Company announced its intention to purchase up to 1,320,000 shares of the Company's common stock pursuant to a Dutch Auction self-tender offer at a price range of $17.27 to $20 per share. The Board of Directors also approved the purchase in the open market or in privately negotiated transactions, following the completion of the Dutch Auction, of shares of common stock in an amount which when added to the number of shares of common stock purchased in the Dutch Auction would equal 1,485,000. The Dutch Auction was concluded on October 7, 1998, with the purchase of 1,353,862 shares at a price of $19.09 per share. At each of the January 22, 1999 and the August 20, 1999 Board of Directors meetings, the Board approved an additional 440,000 shares for the stock repurchase program. Utilizing these Board authorizations, the Company has purchased 635,150 shares through the first quarter of fiscal 2001 for approximately $9.3 million with the price per share ranging from approximately $12 to $17. 7 KNAPE & VOGT MANUFACTURING COMPANY AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Certain matters discussed in this section include forward-looking statements involving risks and uncertainties. When used in this document, the words "believes," "expects," "anticipates," "goal," "think," " forecast," "project," and similar expressions identify forward-looking statements. Forward-looking statements include, but are not limited to, statements concerning future revenue and net income growth. Such statements are subject to certain risks and uncertainties, which would cause actual results to differ materially from those expressed or implied by such forward-looking statements. Readers are cautioned not to place undue reliance on those forward-looking statements that speak only as of the date of this report. RESULTS OF OPERATIONS Net Sales The following table indicates the Company's sales (in millions) and percentage of total sales by product category for the three-month periods ended: Three Months Ended ------------------ Sept. 30, Oct. 2, 2000 % 1999 % ------------------------ ------------------------ Shelving systems $10.6 28.8% $12.3 34.5% Drawer slides 17.1 46.3% 16.9 47.3% Hardware 9.3 24.9% 6.5 18.2% ------------------------ ------------------------ Total $37.0 100.0% $35.7 100.0% ======================== ========================
Net sales for the first quarter of fiscal 2001 were $37.0 million compared to $35.7 million for the same period in the prior year. The decline in shelving systems reflects the loss of shelving sales to a large retailer. The retail market continues to be extremely competitive and the Company must evaluate the profitability of the customers in this market. Drawer slide sales improved slightly over the prior year. The Company experienced double-digit growth in its precision drawer slide sales, which was offset by lower sales of its utility slides. The significant increase in hardware primarily represents sales of the Company's products. Gross Profit Gross profit, as a percentage of net sales, was 28.6% for the first quarter of fiscal 2001 compared to 26.3% for the same period in the prior year. The increase in gross profit during the first quarter of fiscal 2001 reflects the improvements achieved through the Company's focus on lean manufacturing combined with capital investments made to increase capacity and productivity. Operating Expenses Selling and administrative expenses, as a percentage of net sales, for the first quarter ended September 30, 2000, were 18.3% compared to 16.5% in the same period in the prior year. The increase from the prior year was due to the higher operating costs associated with the ergonomic product line coupled with the Company's continued investment to launch its new products into the market. 8 KNAPE & VOGT MANUFACTURING COMPANY AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) Other Expenses/(Income) Interest expense was $381,393 for the first quarter of fiscal 2001, compared to $326,348 for the same period in the prior year. The increase in interest expense was attributable to the higher level of borrowings combined with higher interest rates during the first quarter of fiscal 2001. Other miscellaneous expense was $55,292 for the first quarter of fiscal 2001, compared to other miscellaneous income of $8,399 in the prior year. The expense in fiscal 2001 reflects the loss incurred on the disposal of certain manufacturing assets. Income Taxes The effective tax rate for the quarter ended September 30, 2000, was 35.3% compared with the rate of 35.7% for the same period in the prior year. Net Income For the quarter ended September 30, 2000, net income was $2,180,895 or $0.47 per diluted share compared to $2,044,812 or $0.43 per diluted share for the first quarter of last year. The increase in net income in the first quarter of fiscal 2001 was attributable to the higher sales volume coupled with gross margin improvement. Liquidity and Capital Resources Net cash from operating activities for the first three months provided $2,299,444 as compared to $5,217,324 for the first three months of fiscal 2000. The higher level of working capital negatively impacted cash flows during the quarter. Specifically, inventory levels increased due to higher levels of imported product and accounts payable decreased due to timing of the quarter-end cutoff. Capital expenditures totaled $2,195,587 for the three months ended September 30, 2000, compared to $1,947,282 for the three months ended October 2, 1999. The increased capital spending reflects investments in manufacturing technology, the completion of the new facility at the Indiana subsidiary and tooling for new products. There were no significant capital expenditure commitments at September 30, 2000. Capital expenditures are anticipated to remain at or slightly below the same level as in the first quarter. On October 1, 1999, the Company acquired substantially all of the assets of Idea Industries, Inc. ("Idea") for a purchase price of $5,267,877. Idea designed, manufactured and marketed ergonomic office products, including adjustable keyboard mechanisms, keyboard and computer mouse platforms, wrist rests and CPU holders. The acquisition was recorded using the purchase method of accounting. Accordingly, the purchase price was allocated to the assets acquired and liabilities assumed, based on the estimated fair values at the date of the acquisition. The cost of the acquisition in excess of net identifiable assets acquired has been recorded as goodwill and is being amortized on a straight-line basis over 15 years. The terms of the Idea acquisition agreement provide for additional consideration to be paid if Idea's sales exceed certain targeted levels. The maximum amount of contingent consideration is $550,000 payable through 2001. In calendar year 1999, the additional consideration payment was $41,797, which has been included in goodwill. Any additional consideration paid will be recorded as goodwill when payment is made. 9 KNAPE & VOGT MANUFACTURING COMPANY AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) On September 1, 1998, the Company announced its intention to purchase up to 1,320,000 shares of the Company's common stock pursuant to a Dutch Auction self-tender offer at a price range of $17.27 to $20 per share. The Board of Directors also approved the purchase in the open market or in privately negotiated transactions, following the completion of the Dutch Auction, of shares of common stock in an amount which when added to the number of shares of common stock purchased in the Dutch Auction would equal 1,485,000. The Dutch Auction was concluded on October 7, 1998, with the purchase of 1,353,862 shares at a price of $19.09 per share. At each of the January 22, 1999 and the August 20, 1999 Board of Directors meetings, the Board approved an additional 440,000 shares for the stock repurchase program. Utilizing these Board authorizations, the Company has purchased 635,150 shares through the first quarter of fiscal 2001 for approximately $9.3 million with the price per share ranging from approximately $12 to $17. Since the beginning of the stock repurchase program in fiscal 1999, the Company has purchased 1,989,012 shares for approximately $35.7 million. The long-term debt balance increased to $20,570,000 at September 30, 2000, compared to $20,050,000 at July 1, 2000 and $21,050,000 at October 2, 1999. The increase from July 1, 2000 reflects funds utilized for capital expenditures. The decrease from the October 2, 1999, balance reflects funds utilized for capital expenditures and stock repurchases, offset by net income earned during the period. Anticipated cash flows from operations and available balances on the revolving credit line are expected to be adequate to fund working capital, capital expenditures and dividend payments. Year 2000 As of the date of this report, the Company has not experienced any Year 2000 issues arising from its systems or those of its material vendors and suppliers. To the extent that there may be any ongoing Year 2000 issues that might arise at a later date, the Company has contingency plans in place to address such issues. 10 KNAPE & VOGT MANUFACTURING COMPANY AND SUBSIDIARIES QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The Company is exposed to market risks, which include changes in the foreign currency exchange rate as measured against the U.S. dollar and changes in U.S. interest rates. The Company holds a derivative instrument in the form of an interest rate swap, which is viewed as a risk management tool and is not used for trading or speculative purposes. The intent of the interest rate swap is to effectively fix the interest rate on part of the borrowings under the Company's variable rate revolving credit agreement. Quantitative disclosures relating to financial instruments and debt are included in the tables below. The following table provides information on the Company's fixed maturity investments as of September 30, 2000 that are sensitive to changes in interest rates. The table also presents the corresponding interest rate swap on this debt. Since the interest rate swap effectively fixes the interest rate on the notional amount of debt, changes in interest rates have no current effect on the interest expense recorded by the Company on the portion of the debt covered by the interest rate swap. Liability Amount Maturity Date - --------- ------ ------------- Variable rate revolving credit agreement $45 million November 1, 2004 First $20,000,000 at an interest rate of 6.68% plus weighted average credit spread of .5% Amounts in excess of $20,000,000 have an interest rate of approximately 7.2% Interest Rate Swap Notional amount $20 million June 1, 2006 Pay fixed/Receive variable - 6.68% Pay fixed interest rate - 6.25%
The Company has a sales office located in Canada. Sales are typically denominated in Canadian dollars, thereby creating exposures to changes in exchange rates. The changes in the Canadian/U.S. exchange rate may positively or negatively affect the Company's sales, gross margins and retained earnings. The Company attempts to minimize currency exposure through working capital management. The Company does not hedge its exposure to translation gains and losses relating to foreign currency net asset exposures. 11 KNAPE & VOGT MANUFACTURING COMPANY AND SUBSIDIARIES PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits See Exhibit Index (b) Reports on Form 8-K There were no reports on Form 8-K filed for the three months ended September 30, 2000. 12 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. Knape & Vogt Manufacturing Company (Registrant) Date: November 3, 2000 /s/ William R. Dutmers William R. Dutmers Chairman, President and Chief Executive Officer Date: November 3, 2000 /s/ Leslie J. Cummings Leslie J. Cummings Vice President of Finance and Treasurer 13 EXHIBIT INDEX (27) Financial Data Schedule 14
EX-27 2 0002.txt
5 3-MOS JUN-30-2001 JUL-02-2000 SEP-30-2000 2,213,185 0 19,454,466 634,000 16,672,564 40,773,876 76,181,490 36,668,374 89,238,988 23,434,402 0 0 0 9,231,352 27,139,719 89,238,988 36,957,550 36,957,550 26,383,824 26,383,824 6,743,438 78,000 381,393 3,370,895 1,190,000 2,180,895 0 0 0 2,180,895 0.47 0.47
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