-----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, FVWTbrjKrRpjDHjn1k8iq3fN4+F/+N7qmk0RiTsZBJ+bddzWXizGcIvHC6FL27lu 6nJv2eAYOKHs3ZDpOmo2GQ== 0000950116-95-000520.txt : 19951122 0000950116-95-000520.hdr.sgml : 19951122 ACCESSION NUMBER: 0000950116-95-000520 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19951031 FILED AS OF DATE: 19951121 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: MET PRO CORP CENTRAL INDEX KEY: 0000065201 STANDARD INDUSTRIAL CLASSIFICATION: PUMPS & PUMPING EQUIPMENT [3561] IRS NUMBER: 231683282 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-07763 FILM NUMBER: 95595325 BUSINESS ADDRESS: STREET 1: P O BOX 144 STREET 2: 160 CASSELL ROAD CITY: HARLEYSVILLE STATE: PA ZIP: 19438 BUSINESS PHONE: 2157236751 MAIL ADDRESS: STREET 1: 160 CASSELL ROAD STREET 2: BOX 144 CITY: HARLEYSVILLE STATE: PA ZIP: 19438 FORMER COMPANY: FORMER CONFORMED NAME: MET PRO WATER TREATMENT CORP DATE OF NAME CHANGE: 19740924 FORMER COMPANY: FORMER CONFORMED NAME: MET PRO INC DATE OF NAME CHANGE: 19661026 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended October 31, 1995 Commission file number 001-07763 ------------------ ----------- MET-PRO CORPORATION AND ITS WHOLLY-OWNED SUBSIDIARIES - -------------------------------------------------------------------------------- DELAWARE 23-1683282 - -------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) P.O. BOX 144, HARLEYSVILLE, PA 19438 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code 215-723-6751 ------------------------------ - -------------------------------------------------------------------------------- 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 and (2) has been subject to such filing requirements for the past 90 days. X Yes No ----- ----- 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. Class: COMMON, PAR VALUE $.10 PER SHARE OUTSTANDING at 10/31/95 4,655,040 -------------------------------- --------- MET-PRO CORPORATION AND ITS WHOLLY-OWNED SUBSIDIARIES ----------------------------------------------------- QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 October 31, 1995 INDEX Part I - Financial Information: Condensed consolidated balance sheet as of October 31, 1995 and January 31, 1995 2 Condensed consolidated statement of income for the three-month and nine-month periods ended October 31, 1995 and 1994 3 Condensed consolidated statement of cash flows for the nine-month periods ended October 31, 1995 and 1994 4 Notes to condensed consolidated financial statements 5 Management's discussion and analysis of the financial condition and results of operations 6 to 8 Report on Review by Independent Accountants 9 Part II - Other Information 10 - -1- MET-PRO CORPORATION AND ITS WHOLLY-OWNED SUBSIDIARIES ----------------------------------------------------- CONDENSED CONSOLIDATED BALANCE SHEET (unaudited) - --------------------------------------------------------------------------------
OCTOBER 31, JANUARY 31, 1995 1995 ----------- ----------- ASSETS Current assets: Cash and cash equivalents $ 7,194,985 $ 6,648,380 Accounts receivable, net of allowance for doubtful accounts of approximately $202,000 and $184,000, respectively 9,239,326 8,107,243 Notes Receivable-ESOT 300,000 -- Inventories 11,394,952 10,693,734 Prepaid expenses, deposits and other current assets 790,566 646,571 Deferred income taxes 500,000 500,000 ----------- ----------- Total current assets 29,419,829 26,595,928 Property, plant and equipment, net 13,782,922 13,219,129 Costs in excess of net assets of businesses acquired, net 3,747,200 3,807,326 Other assets 1,303,947 1,546,161 ----------- ----------- Total assets $48,253,898 $45,168,544 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current portion of long-term debt $ 1,175,466 $ 1,170,821 Accounts payable 3,021,896 2,279,262 Accrued salaries, wages and expenses 6,932,184 5,777,565 Payroll and other taxes payable 6,473 6,266 Customers' advances 422,797 272,387 ----------- ----------- Total current liabilities 11,558,816 9,506,301 ----------- ----------- Long-term debt 1,989,144 2,877,386 ----------- ----------- Other non-current liabilities 84,735 34,847 ----------- ----------- Deferred income taxes 620,262 666,000 ----------- ----------- Stockholders' equity: Common stock, $.10 par value; 10,000,000 shares authorized, 4,759,221 and 3,193,418 shares issued, respectively, of which 104,181 and 98,128 shares, were reacquired and held in treasury 475,922 319,342 Additional paid-in capital 7,443,680 7,401,641 Retained earnings 26,776,685 24,816,542 Cumulative translation adjustment 323,727 233,760 ----------- ----------- 35,020,014 32,771,285 Treasury stock, at cost (1,019,073) (687,275) ----------- ----------- Net stockholders' equity 34,000,941 32,084,010 ----------- ----------- Total liabilities and stockholders' equity $48,253,898 $45,168,544 =========== ===========
See accompanying notes to condensed consolidated financial statements. - -2- MET-PRO CORPORATION AND ITS WHOLLY-OWNED SUBSIDIARIES ----------------------------------------------------- CONDENSED CONSOLIDATED STATEMENT OF INCOME (unaudited)
NINE MONTHS ENDED THREE MONTHS ENDED OCTOBER 31, OCTOBER 31, 1995 1994 1995 1994 ----------- ------------ ----------- ----------- Net sales $40,836,917 $ 37,121,444 $14,089,960 $13,177,397 Cost of goods sold 26,918,546 24,879,784 9,263,674 9,048,619 ----------- ------------ ----------- ----------- Gross profit 13,918,371 12,241,660 4,826,286 4,128,778 ----------- ------------ ----------- ----------- Operating expenses: Selling 3,500,128 3,077,667 1,196,512 1,056,764 General and administrative 4,879,692 4,734,858 1,627,318 1,513,416 ----------- ------------ ----------- ----------- 8,379,820 7,812,525 2,823,830 2,570,180 ----------- ------------ ----------- ----------- Income from operations 5,538,551 4,429,135 2,002,456 1,558,598 Other income, net 390,918 177,602 129,201 60,936 ----------- ------------ ----------- ----------- Income before taxes on income 5,929,469 4,606,737 2,131,657 1,619,534 Provision for taxes on income 2,401,438 1,842,695 863,326 647,814 ----------- ------------ ----------- ----------- Net income $ 3,528,031 $ 2,764,042 $ 1,268,331 $ 971,720 =========== ============ =========== =========== Earnings per share* $ .75 $ .59 $ .27 $ .21 =========== ============ =========== =========== Cash dividends per share** $ .30 $ .25 $ - $ - =========== ============ =========== ===========
* Based on weighted average shares outstanding of 4,705,580 and 4,711,504 in the nine-month periods ended October 31, 1995 and 1994, respectively, and 4,686,110 and 4,716,072 in the three-month periods ended October 31, 1995 and 1994, respectively, fully diluted. The average shares outstanding were adjusted for the 3-for-2 stock split which was completed by the Company on May 12, 1995. ** The Company declared a 3-for-2 stock split and a cash dividend of $.30 per share, both of which were paid on May 12, 1995 to stockholders of record on April 7, 1995. The cash dividend was paid on all outstanding shares, including those issued as a result of the stock split. See accompanying notes to condensed consolidated financial statements. - -3- MET-PRO CORPORATION AND ITS WHOLLY-OWNED SUBSIDIARIES ----------------------------------------------------- CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited)
NINE MONTHS ENDED OCTOBER 31, 1995 1994 ----------- ----------- INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS Net cash provided by operating activities $ 4,570,266 $ 3,782,123 ----------- ----------- Net cash (used in) investing activities: Acquisition of property, plant and equipment (net) (1,454,864) ( 858,631) ----------- ----------- Net cash provided by (used in) financing activities: Reduction of debt ( 883,597) ( 873,282) Payment of dividends ( 1,411,308) ( 780,070) Exercise of stock options 299,990 4,000 Purchase of treasury shares ( 589,748) ( 315,050) ----------- ----------- ( 2,584,663) ( 1,964,402) ----------- ----------- Effect of exchange rate changes on cash 15,866 48,675 ----------- ----------- Net increase in cash and cash equivalents 546,605 1,007,765 Cash and cash equivalents: February 1 6,648,380 4,425,347 ----------- ----------- October 31 $ 7,194,985 $ 5,433,112 =========== =========== SUPPLEMENTAL CASH FLOW INFORMATION Cash paid during the period for: Interest $ 203,893 $ 215,780 ----------- ----------- Income taxes $ 2,235,889 $ 1,664,601 ----------- -----------
See accompanying notes to condensed consolidated financial statements. - -4- MET-PRO CORPORATION AND ITS WHOLLY-OWNED SUBSIDIARIES ----------------------------------------------------- NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 1. In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the financial position as of October 31, 1995 and the results of operations for the three-month and nine-month periods ended October 31, 1995 and 1994 and the statement of cash flows for the nine-month periods then ended. The results of operations for the three-month and nine-month periods ended October 31, 1995 are not necessarily indicative of the results to be expected for the full year. 2. Margolis & Company P.C., the Company's auditors, has performed a limited review of the financial information included herein. Their report on such review accompanies this filing. 3. Inventories were comprised of the following: OCTOBER 31, JANUARY 31, 1995 1995 ----------- ----------- Raw material $ 4,668,597 $ 4,381,304 Work-in-progress 1,954,852 1,834,555 Finished goods 4,771,503 4,477,875 ----------- ----------- $11,394,952 $10,693,734 =========== =========== - -5- MET-PRO CORPORATION AND ITS WHOLLY-OWNED SUBSIDIARIES ----------------------------------------------------- MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION AND RESULTS OF OPERATIONS - -------------------------------------------------------------------------------- Results of Operations - --------------------- Sales for the nine-month period ended October 31, 1995 were $40,836,917 compared to $37,121,444 for the nine-month period ended October 31, 1994, an increase of $3,715,473 or 10.0%. This increase was due to higher sales activity in both the Fluid Handling and the Pollution Control Systems and Allied Equipment segments of the business. The backlog at October 31, 1995 was 11.6% higher compared to the backlog at the beginning of the fiscal year. Bookings of new orders were 6.5% higher for the nine-month period ended October 31, 1995 than for the nine-month period ended October 31, 1994. The length of time required to design, engineer, manufacture and ship some of the pollution control systems combined with contract requirements will cause shipments to vary from quarter to quarter. Income before taxes for the nine-month period ended October 31, 1995 was $5,929,469 compared to $4,606,737 for the nine-month period ended October 31, 1994, an increase of $1,322,732 or 28.7%. The increase in income before taxes is related to a combination of factors. The increase in sales of $3,715,473 for the nine-month period ended October 31, 1995 contributed $1,676,711 and the increase in other income contributed $213,316, which was offset by increased operating expenses of $567,295. The gross profit margin for the nine-month period ended October 31, 1995 was 34.1%, compared to 33.0% the same period last year. The increase in gross profit of 1.1% can be attributed to a combination of product mix within both the Fluid Handling and the Pollution Control and Allied Equipment segments, combined with effective cost control measures. Selling expense increased $422,461 during the nine-month period ended October 31, 1995 compared to the same period last year primarily due to an increase in staffing levels. Selling expense as a percentage of sales was 8.6% for the nine-month period ended October 31, 1995, compared with 8.3% for the nine-month period ended October 31, 1994. General and administrative expense was $4,879,692 for the nine-month period ended October 31, 1995 compared to $4,734,858 for the same period last year. General and administrative expense as a percentage of sales declined to 11.9% for the nine-month period ended October 31, 1995 from 12.8% for the same period last year. Other income, net, increased $213,316 for the nine-month period ended October 31, 1995 compared to the nine-month period ended October 31, 1994. Other income, which is comprised primarily of interest income, increased due to higher cash balances combined with slightly higher short-term interest rates. - -6- MET-PRO CORPORATION AND ITS WHOLLY-OWNED SUBSIDIARIES ----------------------------------------------------- MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION AND RESULTS OF OPERATIONS - CONTINUED - -------------------------------------------------------------------------------- Liquidity - --------- The Company's cash and cash equivalents amounted to $7,194,985 on October 31, 1995 and $6,648,380 on January 31, 1995, an increase of $546,605. This increase is the result of positive cash flow provided by operating activities of $4,570,266 and proceeds received from the exercise of stock options of $299,990, offset by payments of long-term debt totalling $883,597, the acquisition of property and equipment amounting to $1,454,864, the acquisition of treasury shares of $589,748 and the payment of dividends of $1,411,308. The Board of Directors declared a 3-for-2 stock split and an annual cash dividend of $ .30 per share payable on May 12, 1995, to shareholders of record on April 7, 1995. The dividend was paid on all outstanding shares, including the additional shares issued as a result of the stock split. This constituted an 80% increase in the cash dividend compared to the previous year. Accounts receivable (net) amounted to $9,239,326 on October 31, 1995 compared to $8,107,243 on January 31, 1995, which represents an increase of $1,132,083. The timing and size of shipments combined with retainage on contracts, especially in the Pollution Control Systems and Allied Equipment segment, will influence accounts receivable balances at any point in time. In August, 1995, loans of $300,000 were authorized to be made to the Employee Stock Ownership Trust to enable the Trust to acquire shares of the Company's stock to be used against future contributions. Inventories were $11,394,952 on October 31, 1995 compared to $10,693,734 on January 31, 1995, an increase of $701,218. Inventory balances fluctuate depending upon the business segment involved, the number of contracts in progress, and lead times required. Current liabilities amounted to $11,558,816 on October 31, 1995 compared to $9,506,301 on January 31, 1995, an increase of $2,052,515. Accounts payable and accrued expenses accounted for $1,897,460 of the increase. The balance amounting to $150,410 is related to customers' advances on projects in progress. The Company has consistently maintained a high "current ratio" and has made little use of its established lines of credit. Funds, in general, have exceeded the needs of the Company. The Company presently foresees no change in this situation. Capital Resources and Requirements - ---------------------------------- Cash flows provided by operating activities during the nine-month period ended October 31, 1995 amounted to $4,570,266 compared with $3,782,123 in the nine-month period ended October 31, 1994, an increase of $788,143. Net cash used in investing activities during the nine-month period ended October 31, 1995 amounted to $1,454,864 compared with $858,631 for the nine-month period ended October 31, 1994. The Company's investing activities represent the acquisition of property, plant, and equipment in the combined operations. During the nine-month period ended October 31, 1995, the Company purchased land in Waukegan, Illinois and commenced construction of a 22,000 square foot building for the Stiles-Kem Division. In addition, the Company expanded the business offices of Mefiag B.V., a subsidiary located in Heerenveen, Holland. - -7- MET-PRO CORPORATION AND ITS WHOLLY-OWNED SUBSIDIARIES ----------------------------------------------------- MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION AND RESULTS OF OPERATIONS - CONTINUED - -------------------------------------------------------------------------------- Financing activities during the nine-month period ended October 31, 1995 required the use of cash of $2,584,663 compared to a use of cash of $1,964,402 for the nine-month period ended October 31, 1994. Cash used for the nine-month period ended October 31, 1995 includes the payment of dividends of $1,411,308, the reduction of debt of $883,597, the acquisition of treasury shares of $589,748, offset by proceeds from the exercise of stock options amounting to $299,990. On June 12, 1995, Met-Pro's Board of Directors announced a stock repurchase plan to buyback up to 75,000 shares of its outstanding common stock. The Company has purchased 42,700 shares under the program as of October 31, 1995. Consistent with past practices, the Company will continue to invest in new product development programs, and will make capital expenditures to support the on-going operations during the coming year. The Company expects to finance all capital expenditures requirements through cash flows generated from operations. - -8- REPORT OF INDEPENDENT ACCOUNTANTS To the Board of Directors Met-Pro Corporation and its Wholly-Owned Subsidiaries Harleysville, Pennsylvania We have reviewed the accompanying condensed consolidated balance sheet of Met-Pro Corporation and its Wholly-Owned Subsidiaries as of October 31, 1995 and the related condensed consolidated statements of income for the three-month and nine-month periods ended October 31, 1995 and 1994 and of cash flows for the nine-month periods ended October 31, 1995 and 1994. These financial statements are the responsibility of the Company's management. We conducted our reviews in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our reviews, we are not aware of any material modifications that should be made to the accompanying condensed consolidated financial statements for them to be in conformity with generally accepted accounting principles. We have previously audited, in accordance with generally accepted auditing standards, the balance sheet as of January 31, 1995 and the related statements of operations, stockholders' equity, and cash flows for the year then ended (not presented herein); and in our report dated February 23, 1995, we expressed an unqualified opinion on those financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of January 31, 1995 is fairly stated, in all material respects, in relation to the balance sheet from which it has been derived. Certified Public Accountants Bala Cynwyd, Pennsylvania November 16, 1995 - -9- MET-PRO CORPORATION AND ITS WHOLLY-OWNED SUBSIDIARIES ----------------------------------------------------- PART II - OTHER INFORMATION ------------------------------------------------------------------------------- Item 6(b) - Exhibits and Reports on Form 8-K: - --------------------------------------------- Reports on Form 8-K - There were no reports on Form 8-K filed for the nine-month period ended October 31, 1995. 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. MET-PRO CORPORATION AND ITS WHOLLY-OWNED SUBSIDIARIES ------------------------------- (REGISTRANT) DATE ---------------- /s/ WILLIAM L. KACIN ------------------------------- WILLIAM L. KACIN, PRESIDENT AND CHIEF EXECUTIVE OFFICER /s/ WILLIAM F. MOFFITT ------------------------------- WILLIAM F. MOFFITT, VICE PRESIDENT, FINANCE, CHIEF FINANCIAL OFFICER, SECRETARY AND TREASURER - -10- EX-27 2 FINANCIAL DATA SCHEDULE
5 9-MOS JAN-31-1996 OCT-31-1995 7,194,985 0 9,239,326 202,000 11,394,952 29,419,829 25,987,105 12,204,183 48,253,898 11,558,816 1,989,144 475,922 0 0 34,000,941 48,253,898 40,836,917 40,836,917 26,918,546 26,918,546 0 0 182,621 5,929,469 2,401,438 0 0 0 0 3,528,031 .75 .75
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