-----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, R2nEg1ebd9waZ/W6t+U2E2/OpxEVmvCsgMSgWFXGNJy7HaMA+OVNKwInvv/SYh/r LKcTE2ZdkKItcrLnLPk8KQ== 0000950115-98-000974.txt : 19980518 0000950115-98-000974.hdr.sgml : 19980518 ACCESSION NUMBER: 0000950115-98-000974 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19980331 FILED AS OF DATE: 19980515 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: MOORE PRODUCTS CO CENTRAL INDEX KEY: 0000067975 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL INSTRUMENTS FOR MEASUREMENT, DISPLAY, AND CONTROL [3823] IRS NUMBER: 231427830 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-00545 FILM NUMBER: 98624200 BUSINESS ADDRESS: STREET 1: SUMNEYTOWN PIKE CITY: SPRING HOUSE STATE: PA ZIP: 19477 BUSINESS PHONE: 2156467400 MAIL ADDRESS: STREET 1: SUMNEYTOWN PIKE CITY: SPRING HOUSE STATE: PA ZIP: 19477 10-Q 1 QUARTERLY REPORT SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1998 -------------- 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 0-545 ----- Moore Products Co. ------------------------------------------------------ (Exact name of Registrant as specified in its charter) Pennsylvania 23-1427830 - -------------------------------------------------------------- ---------------- (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) Spring House, PA 19477 ---------------------------------------- ---------- (Address of principal executive offices) (Zip Code) (Registrant's telephone number, including area code) (215) 646-7400 -------------- 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 [ ]. As of April 30, 1998, the number of shares of Registrant's Common Stock outstanding was 2,612,671. PART I. FINANCIAL INFORMATION Item 1. Financial Statements. MOORE PRODUCTS CO. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended March 31 ------------------------------ 1998 1997 ------------ ------------ Net sales $ 38,356,000 $ 37,818,000 Cost of sales 22,897,000 22,350,000 ------------ ------------ Gross profit 15,459,000 15,468,000 Selling, research and development, administrative and general expenses 13,645,000 13,913,000 ------------ ------------ Operating income 1,814,000 1,555,000 Interest expense -- 84,000 Other (income) expense (87,000) 29,000 ------------ ------------ Income before income taxes 1,901,000 1,442,000 Income tax provision 699,000 387,000 ------------ ------------ Net income $ 1,202,000 $ 1,055,000 ============ ============ Earnings per common share: Basic $ .46 $ .41 ===== ===== Diluted $ .41 $ .38 ===== ===== See Notes to Condensed Consolidated Financial Statements. 2 MOORE PRODUCTS CO. CONDENSED CONSOLIDATED BALANCE SHEETS March 31 December 31 1998 1997 ------------ ------------ (Unaudited) (Note A) ASSETS CURRENT ASSETS Cash and cash equivalents $ 4,056,000 $ 3,816,000 Trade accounts receivable, less allowances of $1,849,000 in 1998 and $1,771,000 in 1997 38,443,000 40,768,000 Inventories 19,886,000 18,317,000 Prepaid expenses and deferred income taxes 4,959,000 4,209,000 ------------ ------------ TOTAL CURRENT ASSETS 67,344,000 67,110,000 PROPERTY, PLANT AND EQUIPMENT 60,765,000 59,526,000 Less: Accumulated depreciation (45,211,000) (44,257,000) ------------ ------------ 15,554,000 15,269,000 OTHER ASSETS Prepaid pension costs 12,495,000 11,613,000 ------------ ------------ $ 95,393,000 $ 93,992,000 ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 9,681,000 $ 8,861,000 Accrued compensation 3,627,000 4,890,000 Advances from customers 3,466,000 2,977,000 Accrued income taxes 2,469,000 1,893,000 Other accrued liabilities 7,575,000 7,254,000 ------------ ------------ TOTAL CURRENT LIABILITIES 26,818,000 25,875,000 OTHER LIABILITIES 7,558,000 7,628,000 STOCKHOLDERS' EQUITY Preferred Stock, 5% cumulative, voting and convertible, par value $1 per share: Authorized - 325,000 shares Issued and outstanding - 175,950 shares 176,000 176,000 Common Stock, par value $1 per share: Authorized - 7,500,000 shares Issued and outstanding - 2,605,331 shares in 1998 and 2,592,628 shares in 1997 2,605,000 2,593,000 Capital in excess of par value 11,163,000 10,980,000 Retained earnings 48,787,000 48,627,000 Foreign currency translation adjustments (1,714,000) (1,887,000) ------------ ------------ TOTAL STOCKHOLDERS' EQUITY 61,017,000 60,489,000 ------------ ------------ $ 95,393,000 $ 93,992,000 ============ ============ See Notes to Condensed Consolidated Financial Statements. 3 MOORE PRODUCTS CO. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Three Months Ended March 31 -------------------------- 1998 1997 ----------- ----------- OPERATING ACTIVITIES: Net income $ 1,202,000 $ 1,055,000 Noncash (income) expenses: Depreciation 913,000 864,000 Deferred income taxes (305,000) (117,000) Pension and other postretirement benefits (952,000) (274,000) Changes in operating assets and liabilities: Trade accounts receivable 2,325,000 (2,323,000) Inventories (1,569,000) 859,000 Accounts payable 820,000 1,574,000 Other accrued liabilities 321,000 356,000 Accrued compensation (1,263,000) 595,000 Advances from customers 489,000 146,000 Accrued income taxes 576,000 26,000 Prepaid expenses (445,000) 10,000 ----------- ----------- Net cash provided by (used in) operating activities 2,112,000 2,771,000 INVESTING ACTIVITY: Net purchase of property, plant and equipment (1,162,000) (300,000) FINANCING ACTIVITIES: Decrease in notes payable to bank -- (3,345,000) Proceeds from exercise of stock options 195,000 -- Dividends paid (1,042,000) -- ----------- ----------- Net cash (used in) provided by financing activities (847,000) (3,345,000) Effect of exchange rate changes 137,000 5,000 ----------- ----------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 240,000 (869,000) Cash and cash equivalents at beginning of year 3,816,000 4,066,000 ----------- ----------- CASH AND CASH EQUIVALENTS END OF PERIOD $ 4,056,000 $ 3,197,000 =========== =========== See Notes to Condensed Consolidated Financial Statements. 4 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) MOORE PRODUCTS CO. March 31, 1998 Note A - Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and in compliance with the Instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three month period ended March 31, 1998, are not necessarily indicative of the results that may be expected for the year ended December 31, 1998. The balance sheet at December 31, 1997, has been derived from the audited financial statements at that date. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 1997. Certain reclassifications have been made in prior periods' financial statements in order to conform with the current-period basis of presentation. Note B - Inventories The components of inventory consist of the following: March 31, December 31, 1998 1997 ----------- ----------- Completed instruments $ 3,206,000 $ 3,590,000 Finished parts 10,256,000 9,078,000 Work in process 5,952,000 5,196,000 Raw material 472,000 453,000 ----------- ----------- $19,886,000 $18,317,000 =========== =========== 5 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) MOORE PRODUCTS CO. March 31, 1998 Note C - Earnings per Share The following table sets forth the computation of basic and diluted earnings per share: Three Months Ended March 31 -------------------------- 1998 1997 ----------- ----------- Numerator: Net income $ 1,202,000 $ 1,055,000 Preferred stock dividends (2,000) (2,000) ----------- ----------- Numerator for basic earnings per share - income available to common stockholders 1,200,000 1,053,000 Effect of dilutive securities: Preferred stock dividends 2,000 2,000 ----------- ----------- Numerator for diluted earnings per share - income available to common stockholders after assumed conversions $ 1,202,000 $ 1,055,000 =========== =========== Denominator: Denominator for basic earnings per share - weighted average shares 2,599,761 2,585,972 Effect of dilutive securities: Stock options 240,399 114,004 Convertible preferred stock 70,380 70,380 ----------- ----------- Dilutive potential common shares 310,779 184,384 ----------- ----------- Denominator for diluted earnings per share - adjusted weighted average shares and assumed conversions 2,910,540 2,770,356 =========== =========== Basic income per share $ .46 $ .41 ===== ===== Diluted income per share $ .41 $ .38 ===== ===== 6 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) MOORE PRODUCTS CO. March 31, 1998 Note D - Comprehensive Income As of January 1, 1998, the Company adopted Statement 130, "Reporting Comprehensive Income." Statement 130 establishes new rules for the reporting and display of comprehensive income and its components; however, the adoption of this Statement had no impact on the Company's net income or shareholders' equity. Statement 130 requires foreign currency translation adjustments, which prior to adoption were reported separately in shareholders' equity, to be included in other comprehensive income. During the first quarter of 1998 and 1997, total comprehensive income, which is comprised of net income and net change in the accumulated foreign currency translation adjustment account for the three month period, amounted to $1,375,000 and $949,000, respectively. 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations Sales for the first quarter of 1998 were $38,356,000 compared to $37,818,000 for the same period last year. Higher shipments in the United States were largely offset by lower shipments in Europe. Order bookings for the first quarter of fiscal 1998 were $45,217,000 compared to $39,217,000 for the same period last year, a 15% increase. This increase is primarily attributed to orders placed for process automation systems products, including orders placed on our United Kingdom subsidiary of approximately $7 million for delivery in 1998. The consolidated backlog of unshipped orders as of March 31, 1998 was $44,874,000 compared to $46,634,000 as of March 31, 1997. Gross profit for the first quarter was $15,459,000, or 40% of sales, compared to $15,468,000, or 41% of sales, for the first quarter of 1997. As a result of product mix and higher manufacturing costs, gross profit margin percentages declined slightly compared to last year. Selling, research and development, administrative and general expenses for the first quarter were $13,645,000, or 36% of sales, compared to $13,913,000, or 37% of sales in 1997. Higher payroll, sales and marketing expenses in 1998 were offset by higher net periodic pension income related to the Company's defined benefit pension plan. There was no interest expense recorded for the first quarter of 1998 compared to $84,000 for the first quarter last year. The Company's year-to-date effective tax rate was 37% of pretax income compared to 27% for the first three months of 1997. The fluctuation in the rates was attributable to a changing mix of operating results in countries for which loss benefit carryovers are available. Statutory rates are applied to pretax income in the United States. Consistent with previous reporting periods, tax benefits for losses incurred by certain international subsidiaries in tax jurisdictions outside the United States have not been fully recognized for financial reporting purposes because the realization of such benefits is not presently assured. Net income for the first quarter ended March 31, 1998 was $1,202,000 compared to net income of $1,055,000 for the first quarter of 1997. Diluted net income per share was $0.41 for the first quarter of 1998 compared to $0.38 for the first quarter of 1997. 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued) Liquidity and Capital Resources Cash and cash equivalents increased during the first quarter of 1998 by $240,000. Positive cash flow of $2,112,000, generated from operations, was used to fund capital expenditures and a special 40 cent per share cash dividend on the common stock. Capital expenditures were related primarily to facilities and equipment in support of sales and marketing promotion, and product development. Working capital decreased $709,000 at March 31, 1998, to $40,526,000 from $41,235,000 at December 31, 1997. Accounts receivable declined $2,325,000 in the first quarter of 1998 following record sales in the fourth quarter of 1997. During the first quarter of 1998 inventory levels increased by $1,569,000 reflecting the increase in order backlog from the year ended 1997. Cash and cash equivalents amounted to $4,056,000 at March 31, 1998. The Company had no outstanding advances under credit arrangements at March 31, 1998. Management believes that current cash and cash equivalents, cash flow from operations, and its established credit facilities of approximately $16,000,000 should be sufficient during 1998 to fund planned capital expenditures, working capital needs, dividends, and other cash requirements. The Company has reviewed computer systems to identify and address code changes, testing, and implementation procedures necessary to make these systems Year 2000 compliant. Management believes that after modification to existing software and conversion to new software, the Year 2000 problem will not pose significant operational problems for the Company's computer systems. The Company expects to be compliant by the end of the calendar year 1998. The Company is conducting ongoing discussions with its suppliers and key customers to ensure that those parties have taken appropriate steps to address Year 2000 issues in their systems which may interface with the Company's systems or otherwise impact operations. The Company has determined that current product offerings are Year 2000 compliant. For very limited older generation products, the Company is in communications with customers with advice on recommended corrective actions. Amounts expended for Year 2000 projects have not been and are not expected to be significant to the Company's results of operations or financial condition. 9 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued) This report contains various forward-looking statements and includes assumptions concerning the Company's operations, future results and prospects. These forward-looking statements are based on current expectations and subject to risks and uncertainties. The Company does not undertake any obligation to publicly release the results of any revisions that may be made to these forward-looking statements to reflect any future events or circumstances. In connection with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, the Company provides this cautionary statement identifying important factors that, among others, could cause the actual results and events to differ materially from those set forth in or implied by forward-looking statements and related assumptions. Such factors include, but are not limited to: product demand and market acceptance risks; the effect of global economic conditions; the impact of competitive products and pricing; product development and technological difficulties; capacity and supply constraints or difficulties; availability of capital resources; general business conditions; and changes in government laws and regulations, including taxes. 10 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits: Exhibit Number Description ------- ------------------------------------------------------------------- 27.1 Financial Data Schedule for Quarter Ended March 31, 1998. 27.2 Restated Financial Data Schedule for Quarters Ended March 31, 1997, June 30, 1997 and September 30, 1997. 27.3 Restated Financial Data Schedule for Year Ended December 31, 1997. ------------------------------------- (b) No reports on Form 8-K were filed during the most recently completed fiscal quarter. 11 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. MOORE PRODUCTS CO. Dated: May 13, 1998 By: /s/ R. E. Wisniewski -------------------------------------- As Secretary and Treasurer and as Principal Financial and Accounting Officer 12 EX-27.1 2 ART. 5 FDS FOR 1ST QUARTER 10-Q
5 3-MOS DEC-31-1998 MAR-31-1998 4056000 0 40292000 1849000 19886000 67344000 60765000 45211000 95393000 26818000 0 0 176000 2605000 0 95393000 38356000 38356000 22897000 22897000 0 0 0 1901000 699000 1202000 0 0 0 1202000 .46 .41
EX-27.2 3 ART. 5 FDS FOR 1ST, 2ND AND 3RD QUARTER 10-Q
5 3-MOS 6-MOS 9-MOS DEC-31-1997 DEC-31-1997 DEC-31-1997 MAR-31-1997 JUN-30-1997 SEP-30-1997 3197000 4736000 4622000 0 0 0 33694000 33877000 35697000 830000 1771000 1771000 20620000 21611000 21806000 60396000 62146000 64069000 58205000 58940000 59436000 42336000 43034000 43758000 86348000 88825000 90782000 23719000 25218000 25617000 0 0 0 2586000 2586000 2589000 0 0 0 176000 176000 176000 0 0 0 86348000 88825000 90782000 37818000 75715000 116138000 37818000 75715000 116138000 22350000 44273000 67339000 22350000 44273000 67339000 0 0 0 0 0 0 84000 167000 170000 1442000 2987000 6152000 387000 884000 2262000 1055000 2103000 3890000 0 0 0 0 0 0 0 0 0 1055000 2103000 3890000 .41 .81 1.50 .38 .76 1.41
EX-27.3 4 ART. 5 FDS FOR 1997 FORM 10-K
5 12-MOS DEC-31-1997 DEC-31-1997 3816000 0 42539000 1771000 18317000 67110000 59526000 44257000 93992000 25875000 0 0 176000 2593000 0 93992000 167247000 167247000 95109000 95109000 0 0 172000 10225000 3757000 6468000 0 0 0 6468000 2.50 2.31
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