-----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, Eh6WXsH34l4opWo45Po/6TtccyEq0PS5kqKbz+oF5Kg68egWLOCqlUlYMjUbkRDt 1pvOCpYaJJv3+Qoj4DhfsA== 0000704460-97-000009.txt : 19970317 0000704460-97-000009.hdr.sgml : 19970317 ACCESSION NUMBER: 0000704460-97-000009 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970131 FILED AS OF DATE: 19970314 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: PPT VISION INC CENTRAL INDEX KEY: 0000704460 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL INSTRUMENTS FOR MEASUREMENT, DISPLAY, AND CONTROL [3823] IRS NUMBER: 411413345 STATE OF INCORPORATION: MN FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-11518 FILM NUMBER: 97556538 BUSINESS ADDRESS: STREET 1: 10321 W 70TH ST CITY: EDEN PRAIRIE STATE: MN ZIP: 55344 BUSINESS PHONE: 6129425747 MAIL ADDRESS: STREET 1: 10321 W 70TH ST CITY: EDEN PRAIRIE STATE: MN ZIP: 55344 FORMER COMPANY: FORMER CONFORMED NAME: PATTERN PROCESSING TECHNOLOGIES INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: PATTERN PROCESSING CORP DATE OF NAME CHANGE: 19840318 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ----------- QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended January 31, 1997 Commission File Number 0-11518 PPT VISION, INC. --------------------------------------------------------------------- (Exact name of registrant as specified in its charter) MINNESOTA 41-1413345 ---------------------------------------------------------------------- (State of other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 10321 West 70th Street Eden Prairie, Minnesota 55344 ---------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (612) 996-9500 ---------------------------------------------------------------------- (Registrant's telephone number including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 of 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 last 90 days. Yes X No Shares of $.10 par value common stock outstanding at March 10, 1997: 5,372,307 Total pages this report: 13 Page 2 INDEX PPT VISION, INC. Part I. Financial Information Page - ------- --------------------- ---- Item 1. Unaudited Financial Statements Balance Sheets as of January 31, 1997 and................ 3 October 31, 1996 Income Statements for the Three-Month Periods............ 4 ended January 31, 1997 and January 31, 1996 Statement of Cash Flows for the Three-Month Periods...... 5 ended January 31, 1997 and January 31, 1996 Notes to Financial Statements-- January 31, 1997......... 6 Item 2. Management's Discussion and Analysis of.................. 7 Financial Condition and Results of Operations Part II. Other Information....................................... 10 - -------- ----------------- Item 1. Legal Proceedings Item 2. Changes in Securities Item 3. Defaults Upon Senior Securities Item 4. Submission of Matters to a Vote of Security Holders Item 5. Other Information Item 6. Exhibits and Reports on Form 8-K Signatures............................................. 11 ---------- Page 3 PPT VISION, INC. BALANCE SHEETS 01/31/97 10/31/96 Note A Note A ----------- ----------- (unaudited) ASSETS Cash and cash equivalents............. $ 1,449,000 $ 4,179,000 Investments........................... 18,385,000 15,135,000 Accounts receivable, net.............. 3,365,000 4,451,000 Inventories: Manufactured and purchased parts.... 1,363,000 1,015,000 Work-in-process..................... 127,000 144,000 Finished goods...................... 77,000 69,000 Other current assets.................. 161,000 171,000 ----------- ----------- Total current assets............. 24,927,000 25,164,000 Restricted cash....................... 93,000 135,000 Fixed assets, net..................... 1,018,000 863,000 Other assets, net..................... 82,000 79,000 Deferred income taxes................. 1,844,000 1,815,000 ----------- ----------- Total assets..................... $27,964,000 $28,056,000 =========== =========== LIABILITIES AND EQUITY Current liabilities................... $ 988,000 $ 1,081,000 Deferred rent......................... 161,000 166,000 Shareholders' equity: Common stock.......................... 536,000 536,000 Capital in excess of par value........ 29,449,000 29,443,000 Accumulated (deficit)................. (3,165,000) (3,170,000) Unrealized loss--investments.......... (5,000) -- ----------- ----------- Total shareholders' equity....... 26,815,000 26,809,000 ----------- ----------- Total liabilities and shareholders' equity............. $27,964,000 $28,056,000 =========== ===========
Page 4 PPT VISION, INC. INCOME STATEMENTS (UNAUDITED) Three Months Ended January 31, ------------------------ 1997 1996 ----------- ----------- (unaudited) (unaudited) Net revenues............... $2,370,000 $3,135,000 Cost of sales.............. 1,004,000 1,303,000 ---------- ---------- Gross profit............... 1,366,000 1,832,000 Expenses: Selling.................. 818,000 571,000 General and administrative.......... 306,000 280,000 Research and development............. 508,000 447,000 ---------- ---------- Total expenses........... 1,632,000 1,298,000 ---------- ---------- Income from operations..... (266,000) 534,000 Interest income............ 274,000 16,000 Other income (expense)..... -- 7,000 ---------- ---------- Net income before taxes.... 8,000 557,000 Income tax (expense)....... (3,000) -- ---------- ---------- Net income................. $ 5,000 $ 557,000 ========== ========== Per share data (Notes B and C): Weighted average common shares outstanding......... 5,478,000 3,783,000 Net income per share....... $ 0.00 $ 0.15 ========== ==========
Page 5 PPT VISION, INC. STATEMENT OF CASH FLOWS Three Months Three Months Ended Ended January 31, 1997 January 31, 1996 ---------------- ---------------- (unaudited) (unaudited) Net income................................. $ 5,000 $ 557,000 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization............. 93,000 52,000 Deferred rent............................. (5,000) 6,000 Deferred income tax benefit............... (29,000) -- Interest earned not paid.................. (148,000) -- Change in assets and liabilities Accounts receivable....................... 1,086,000 263,000 Inventories............................... (339,000) 44,000 Other assets.............................. 10,000 (48,000) Restricted cash........................... 42,000 -- Accounts payable and accrued expenses..... (93,000) (276,000) ---------- ---------- Total adjustments........................ 617,000 41,000 ---------- ---------- Net cash provided by operating activities.............................. 622,000 598,000 Cash flows from investing activities: Purchase of fixed assets.................. (252,000) (198,000) Purchase of investments................... (5,131,000) -- Proceeds on sales of investments.......... 2,025,000 -- Realized gain on investments.............. -- -- ---------- ---------- Net cash used by investing activities.... (3,358,000) (198,000) Cash flows from financing activities Proceeds from issuance of common stock.... 6,000 19,000 ---------- ---------- Net cash provided by financing activities.............................. 6,000 19,000 ---------- ---------- Net increase in cash and cash equivalents.. (2,730,000) 419,000 Cash and cash equivalents at beginning of year......................... 4,179,000 1,235,000 ---------- ---------- Cash and cash equivalents at end of period............................. $1,449,000 $1,654,000 ========== ==========
Page 6 PPT VISION, INC. NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED) JANUARY 31, 1997 NOTE A - BASIS OF PRESENTATION The accompanying unaudited condensed financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the 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. For further information, refer to the financial statements and footnotes thereto included in the Company's annual report on Form 10-K for the year ended October 31, 1996. NOTE B - STOCK SPLIT On March 14, 1996, the Board of Directors approved a three-for-two stock split in the form of a fifty percent (50%) stock dividend. The distribution of shares was made on April 5, 1996 to shareholders of record as of March 25, 1996. All historical share and per share data included in the financial statements and exhibits have been restated to reflect the stock split. NOTE C - PUBLIC STOCK OFFERING On June 19, 1996, the Company announced the sale of 1,600,000 shares of its Common Stock through a public offering underwritten by Alex. Brown & Sons Incorporated and Piper Jaffray Inc. The shares were sold to the public at the offering price of $12.00 per share, with net proceeds of $17.7 million. Page 7 Item 2 - ------ MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Results of Operations - --------------------- Net Revenues: Net revenues decreased 24% to $2,370,000 for the three-month period ended January 31, 1997, compared to net revenues of $3,135,000 for the same period in fiscal 1996. The decrease in net revenues in fiscal 1997 is mainly due to a 23% decrease in unit sales, with sales of the Company's machine vision systems decreasing to 86 for the first quarter of fiscal 1997 versus 112 for the same period in fiscal 1996. Net revenues for the first quarter of fiscal 1997 decreased 3% in North America and 57% outside North America. Sales to customers outside North America represented 22% of total revenues in the first quarter of fiscal 1997, compared to 40% for the same period in fiscal 1996. The decrease in North America is primarily the result of a slowdown in deliveries to two significant customers in the electronics segment and one significant customer in the transportation segment. The decline internationally is primarily the result of decreased deliveries in the Far East. In addition, international sales in the first quarter of fiscal 1996 were unusually high compared with fiscal 1996 as a whole. Gross Profit: Gross profit decreased 25% to $1,366,000 for the three-month period ended January 31, 1997, compared to $1,832,000 for the same period in fiscal 1996. As a percentage of net revenues, the gross profit for the first quarter of fiscal 1997 remained relatively constant at 58%, compared with the first quarter of fiscal 1996. The Company anticipates that it can support increased net revenues at its current manufacturing capacity. The Company anticipates that the gross profit as a percentage of net revenues may fluctuate and may decline temporarily at certain times in fiscal 1997 due to normal start- up costs associated with expected new product introductions. Selling Expenses: Selling expenses increased 43% to $818,000 for the three- month period ended January 31, 1997, compared to $571,000 for the same period in fiscal 1996. As a percentage of net revenues, selling expenses increased to 35% for the first quarter of fiscal 1997, compared to 18% for the first quarter of fiscal 1996. The increase in expenditures is the result of the addition of several application engineers and sales people in the latter part of fiscal 1996. The increase as a percentage of net revenues is primarily due to the reduced level of sales in the quarter. Although the Company will limit the rate of growth in selling expenses, it is anticipated that selling expenses will increase in fiscal 1997 as the Company maintains its investments in sales and applications engineering. However, the Company believes that during the remainder of fiscal 1997, selling expenses may decline as a percentage of net revenues compared to the first quarter of fiscal 1997 if sales growth resumes. General and Administrative Expenses: General and administrative expenses increased 9% to $306,000 for the three-month period ended January 31, 1997, compared to $280,000 for the same period in fiscal 1996. As a percentage of net revenues, general and administrative expenses increased to 13% for the first quarter of fiscal 1997, compared to 9% for the first quarter of fiscal 1996. The increase in expenditures is primarily attributable to increased expenses Page 8 associated with operating the Company as it continues to grow. The increase as a percentage of net revenues is primarily due to the reduced level of sales in the quarter. The Company believes that during the remainder of fiscal 1997, general and administrative expenses may decline as a percentage of net revenues compared to the first quarter of fiscal 1997 if sales growth resumes. Research and Development Expenses: Research and development expenses increased 14% to $508,000 for the three-month period ended January 31, 1997, compared to $447,000 for the same period in fiscal 1996. As a percentage of net revenues, research and development expenses increased to 21% for the first quarter of fiscal 1997, compared to 14% for the first quarter of fiscal 1996. The increase in expenses is mainly due to new product development programs and increased staffing to support these efforts. The increase as a percentage of net revenues is primarily due to the reduced level of sales in the quarter. While research and development expenses may increase as the Company continues to invest in next generation software and hardware development, the Company expects that during the remainder of fiscal 1997, such expenses may decline as a percentage of net revenues compared to the first quarter of fiscal 1997 if sales growth resumes. Interest income increased to $274,000 for the three-month period ended January 31, 1997, compared to $16,000 for the same period in fiscal 1996. The increase in interest income is primarily due to interest on the proceeds of a public stock offering completed in June of 1996. Income Tax (Expense) Benefit: Income tax expense of $3,000 was recorded for the three-month period ended January 31, 1997, compared with $0 for the same period in fiscal 1996. The increase in income tax expense resulted from the full recognition of the potential future tax benefits of loss carry forwards and net deductible temporary differences available to offset taxable income in future periods, which occurred in the fourth quarter of fiscal 1996. As a result of this full recognition, the Company is reporting earnings on a fully-taxed basis. Liquidity and Capital Resources - ------------------------------- Working capital decreased to $23,939,000 on January 31, 1997 from $24,083,000 on October 31, 1996. Net cash provided from operating activities was $622,000. During the first three months of fiscal 1997, accounts receivable decreased $1,086,000 and inventories increased $339,000. Both of these events are primarily due to the reduced level of sales in the first quarter of fiscal 1997. In addition, the increase in inventories is also partially related to raw material purchases to support new product introductions. The Company used $3,358,000 in cash flow in investing activities, primarily for the purchase of investments and capital equipment. Investments consist of short-term investment grade securities. In addition, the Company generated $6,000 from its financing activities as a result of issuances of its Common Stock upon exercise of stock options. Current assets decreased to $24,927,000 at January 31, 1997 from $25,164,000 at October 31, 1996. This decrease was primarily due to the decline in accounts receivable to $3,365,000 at January 31, 1997 from $4,451,000 at October 31, 1996. Page 9 Current liabilities decreased to $988,000 at January 31, 1997 from $1,081,000 at October 31, 1996. This was mainly due to a reduction in accrued expenses which resulted from the full payment of certain accrued expenses. The Company believes that it cash flow from operations, existing cash and cash equivalents, and investments at January 31, 1997 will be adequate for its foreseeable operating needs. FORWARD LOOKING STATEMENT - ------------------------- Certain of the statements contained in this Form 10-Q that relate to expectations regarding future sales and profitability contain forward-looking statements regarding future performance of the Company. The Company's actual results could differ materially from the estimates made in the forward-looking statements as a result of a number of factors, including (i) risks and uncertainty in the market for machine vision, (ii) cyclicality of capital spending by customers, (iii) quarterly fluctuations in operating results by the Company due to the long selling cycle for machine vision products, (iv) the Company's continued ability to achieve significant international revenue, (v) competition in the Company's principal markets and (vi) the Company's ability to continue to enhance its current products and develop new products that keep pace with technological developments and evolving industry standards. The Company wishes to caution readers not to place undue reliance upon any such forward- looking statement, which speak only as of the date made. Page 10 PART II. Other Information Item 1: LEGAL PROCEEDINGS ----------------- None Item 2: CHANGES IN SECURITIES --------------------- None Item 3: DEFAULTS UPON SENIOR SECURITIES ------------------------------ None Item 4: SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS --------------------------------------------------- On March 5, 1997, the Company held its Annual Meeting of Shareholders. At the meeting, the following actions were taken: (a) The following persons were re-elected to the Company's Board of Directors receiving the votes set forth opposite their names: For Withheld --------- -------- Joseph C. Christenson.. 4,902,016 44,154 Larry G. Paulson....... 4,902,016 44,154 Bruce C. Huber......... 4,902,566 43,604 Peter R. Peterson...... 4,902,509 43,661 David Malmberg......... 4,902,766 43,404
(b) The Company's shareholders approved a proposal to amend the Company's 1988 Stock Option Plan by a vote of 3,921,578 shares in favor, 64,502 shares against, and 779,362 shares abstaining. (c) The Company's shareholders approved the Company's 1997 Stock Option Plan by a vote of 2,409,052 shares in favor, 63,840 shares against, and 2,292,550 shares abstaining. Item 5: OTHER INFORMATION ----------------- None Item 6: EXHIBITS AND REPORTS ON FORM 8-K -------------------------------- (a) Exhibits: Page 1. Exhibit 11 - Calculation of Earnings per Share.......... 12 2. Exhibit 27 - Financial Data Schedule.................... 13 (b) Reports on Form 8-K None Page 11 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on behalf of the undersigned duly authorized. PPT VISION, INC. Date: March 14, 1997 /s/Thomas R. Northenscold ----------------------------- Thomas R. Northenscold (Chief Financial Officer) Page 12 Exhibit 11 PPT VISION, INC. Calculation of Earnings Per Share Three Months Ended January 31, -------------------- 1997 1996 --------- --------- Primary earnings per share Net income...................... $ 5,000 $ 557,000 Common and common equivalent shares: Weighted average number of common shares outstanding...... 5,360,538 3,584,458 Dilutive effect of stock options outstanding after application of treasury stock method.......... 117,697 198,604 ---------- ---------- Weighted average number of common and common equivalent shares outstanding............. 5,478,235 3,783,062 ========== ========== Primary net income per common and common equivalent share:......... $0.00 $0.15
EX-27 2
5 3-MOS OCT-31-1997 JAN-31-1997 1449000 18385000 3390000 (25000) 1728000 24927000 2928000 (1910000) 27964000 988000 0 0 0 26820000 (5000) 26815000 2370000 2370000 1004000 1632000 0 0 (274000) 8000 3000 5000 0 0 0 5000 0.00 0.00
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