-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, FeaYTQAPZT8f0cp2+dn0DhiNcAH8YAken7mBKBG7H59EH56ehxvYdFewCl/3t+6q LrXPuP3b5z5hoNfEOkMtow== 0000720672-94-000009.txt : 19940811 0000720672-94-000009.hdr.sgml : 19940811 ACCESSION NUMBER: 0000720672-94-000009 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19940624 FILED AS OF DATE: 19940808 SROS: MSE SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: STIFEL FINANCIAL CORP CENTRAL INDEX KEY: 0000720672 STANDARD INDUSTRIAL CLASSIFICATION: 6211 IRS NUMBER: 431273600 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-09305 FILM NUMBER: 94542313 BUSINESS ADDRESS: STREET 1: 500 N. BROADWAY STREET 2: 14TH FLOOR CITY: ST LOUIS STATE: MO ZIP: 63102-2188 BUSINESS PHONE: 3143422000 MAIL ADDRESS: STREET 1: 500 N BROADWAY CITY: ST LOUIS STATE: MO ZIP: 63102-2188 10-Q 1 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 June 24, 1994 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 1-9305 STIFEL FINANCIAL CORP. (Exact name of registrant as specified in its charter) DELAWARE 43-1273600 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 500 N. Broadway, St. Louis, Missouri 63102-2188 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code 314-342-2000 (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 (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 / / Shares of common stock outstanding at June 24, 1994: 3,989,406 par value $.15. Exhibit Index is on page 16. STIFEL FINANCIAL CORP. AND SUBSIDIARIES INDEX PAGE PART I. FINANCIAL INFORMATION Item 1. Financial Statements (Unaudited) Consolidated Statements of Financial Condition -- June 24, 1994 and December 31, 1993 3-4 Consolidated Statements of Operations -- Three Months Ended June 24, 1994 and June 25, 1993 5 Consolidated Statements of Operations -- Six Months Ended June 24, 1994 and June 25, 1993 6 Consolidated Statements of Cash Flows-- Six Months Ended June 24, 1994 and June 25, 1993 7-8 Notes to Consolidated Financial Statements 9 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 10-13 PART II. OTHER INFORMATION Item 1. Legal Proceedings 14 Item 6. Exhibits and Reports on Form 8-K 14 Signatures 15 PART 1. FINANCIAL CONDITION Item 1. Financial Statements STIFEL FINANCIAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
June 24, 1994 December 31, 1993 (Unaudited) (Note) ASSETS Cash and cash equivalents $ 6,744,546 $ 6,542,052 Cash and U.S. Government securities segregated for the exclusive benefit of customers 1,263,472 1,261,480 Receivable from brokers and dealers 17,053,577 16,462,295 Receivable from customers (less allowance for doubtful accounts of $1,536,096 at June 24, 1994 and $1,435,058 at December 31, 1993) 136,367,657 153,373,372 Securities owned, at market value 27,657,460 86,510,135 Membership in exchanges, at cost (approximate market value: $1,770,500 at June 24, 1994 and $1,514,000 at December 31, 1993) 513,015 513,015 Office equipment, leasehold improvements, and building, at cost (less allowances for de- preciation and amortization of $13,901,083 at June 24, 1994 and $12,973,124 at December 31, 1993, respectively) 4,678,226 4,760,453 Non-securities receivable from employees 4,700,110 2,754,086 Goodwill and other intangible assets 4,428,143 4,590,998 Miscellaneous other assets 9,562,370 11,435,070 ------------ ------------ $212,968,576 $288,202,956 ============ ============
NOTE: The Consolidated Statement of Financial Condition at December 31, 1993 has been derived from the audited financial statements at that date. See Notes to Consolidated Financial Statements. STIFEL FINANCIAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (CONTINUED)
June 24, 1994 December 31, 1993 (Unaudited) (Note) LIABILITIES AND STOCKHOLDERS' EQUITY Short-term borrowings from banks $ 54,250,000 $136,950,000 Payable to brokers and dealers 51,496,031 24,522,655 Payable to customers 24,814,049 36,323,885 Market value of securities sold, but not yet purchased 1,962,309 3,906,547 Drafts payable 11,342,934 14,376,402 Employee compensation 8,207,929 8,987,033 Obligation under capital leases 596,117 931,274 Accounts payable and accrued expenses 9,331,061 10,835,943 Long-term debt 10,760,000 10,760,000 ------------ ------------ Total Liabilities 172,760,430 247,593,739 Stockholders' equity Common stock 617,886 617,886 Additional paid-in capital 17,332,836 17,268,905 Retained earnings 23,490,088 24,161,663 ------------ ------------ 41,440,810 42,048,454 Less: Cost of stock in treasury 1,102,540 1,240,452 Unamortized expense of restricted stock awards 130,124 198,785 ------------ ------------ Total Stockholders' Equity 40,208,146 40,609,217 ------------ ------------ $212,968,576 $288,202,956 ============ ============
NOTE:The Consolidated Statement of Financial Condition at December 31, 1993 has been derived from the audited financial statements at that date. See Notes to Consolidated Financial Statements. STIFEL FINANCIAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Three Months Ended June 24, 1994 June 25, 1993 REVENUES Commissions $ 6,311,971 $ 7,202,547 Principal transactions 5,666,571 5,633,083 Investment banking 2,248,680 8,789,698 Interest 2,695,122 2,024,737 Sale of investment company shares 2,341,641 2,898,510 Sale of insurance products 566,167 477,553 Sale of unit investment trusts 353,883 812,576 Other 2,561,739 1,635,458 ----------- ----------- 22,745,774 29,474,162 EXPENSES Employee compensation & benefits 14,743,984 18,386,420 Commissions & floor brokerage 541,225 649,632 Communication & office supplies 1,697,206 1,652,378 Occupancy & equipment rental 2,215,681 1,875,525 Promotional 718,345 799,111 Interest 1,489,311 1,144,107 Other operating expenses 2,564,461 1,723,936 ----------- ----------- 23,970,213 26,231,109 ----------- ----------- (LOSS) INCOME BEFORE INCOME TAXES (1,224,439) 3,243,053 (Benefit) Provision for income taxes (493,357) 1,212,156 ----------- ----------- NET (LOSS) INCOME $ (731,082) $ 2,030,897 =========== =========== Net (loss) income per share: Primary $ (0.18) $ 0.50 Fully diluted $ (0.18) $ 0.42 Dividends declared per share $ 0.03 $ 0.025 Average common equivalent shares used in calculation: Primary 4,097,000 4,057,000 Fully diluted 5,322,000 5,283,000
See Notes to Consolidated Financial Statements. STIFEL FINANCIAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Six Months Ended June 24, 1994 June 25, 1993 REVENUES Commissions $13,332,201 $14,107,637 Principal transactions 10,159,509 11,480,034 Investment banking 7,187,403 14,901,003 Interest 5,129,673 4,246,319 Sale of investment company shares 5,618,346 5,861,947 Sale of insurance products 1,183,833 965,425 Sale of unit investment trusts 1,338,514 1,713,275 Other 4,623,260 2,969,109 ----------- ----------- 48,572,739 56,244,749 EXPENSES Employee compensation & benefits 31,423,341 35,316,015 Commissions & floor brokerage 1,026,098 1,260,423 Communication & office supplies 3,677,514 3,383,598 Occupancy & equipment rental 4,370,224 3,726,040 Promotional 1,531,344 1,526,229 Interest 2,778,458 2,494,044 Other operating expenses 4,700,816 3,195,616 ----------- ----------- 49,507,795 50,901,965 ----------- ----------- (LOSS) INCOME BEFORE INCOME TAXES (935,056) 5,342,784 (Benefit) Provision for income taxes (383,357) 1,915,206 ----------- ----------- NET (LOSS) INCOME $ (551,699) $ 3,427,578 =========== =========== Net (loss) income per share: Primary $ (0.13) $ 0.85 Fully diluted $ (0.13) $ 0.72 Dividends declared per share $ 0.03 $ 0.05 Average common equivalent shares used in calculation: Primary 4,117,000 4,040,000 Fully diluted 5,342,000 5,277,000
See Notes to Consolidated Financial Statements. STIFEL FINANCIAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Six Months Ended June 24, 1994 June 25, 1993 CASH FLOWS FROM OPERATING ACTIVITIES Net (loss) income $ (551,699) $ 3,427,578 Non-cash items included in earnings: Depreciation and amortization 1,233,684 1,033,238 Bonus notes amortization 164,209 321,195 Deferred compensation 207,296 103,181 Provision for litigation and bad debt 541,928 896,824 Unrealized losses on investments 15,000 372,823 Amortization of restricted stock awards 68,661 92,399 ----------- ----------- 1,679,079 6,247,238 Decrease (increase) in operating receivables: Customers 17,005,715 2,299,900 Brokers and dealers (591,282) 1,196,214 (Decrease) increase in operating payables: Customers (11,509,836) (7,831,074) Brokers and dealers 26,973,376 (1,819,856) (Increase) decrease in other receivables and assets: Cash & U.S. Government securities segregated for the exclusive benefit of customers (1,992) 3,697,757 Securities owned 58,852,675 (50,416,189) Other assets 326,104 (1,371,785) (Decrease) increase in liabilities: Securities sold not yet purchased (1,944,238) 1,315,264 Securities sold under repurchase agreement - - (36,906,900) Drafts payable, accrued expenses, and employee compensation (5,530,865) (5,475,190) ------------ ------------ Cash Provided By (Used For) Operating Activities $ 85,258,736 $(89,064,621)
See Notes to Consolidated Financial Statements. STIFEL FINANCIAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED) (UNAUDITED)
Six Months Ended June 24, 1994 June 25, 1993 Cash Provided By (Used For) Operating Activities - from previous page $ 85,258,736 $(89,064,621) CASH FLOWS FROM FINANCING ACTIVITIES Net (payments for) proceeds from short-term borrowings from banks (82,700,000) 83,110,000 Proceeds from: Employee stock purchase plan 611,688 - - Exercised stock options 58,444 166,751 Payments for: Purchase of treasury stock (559,267) (291,790) Restricted stock awards - - (40,722) Principal payments under capital leases (335,157) (299,638) Cash dividends (119,876) (186,360) ------------ ------------ Cash (Used For) Provided By Financing Activities (83,044,168) 82,458,241 CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from: Sale of investments 7,048 14,633 Sale of office equipment and leasehold improvements 1,930 6,724 Payments for: Acquisition of office equipment, leasehold improvements and building (985,457) (633,855) Acquisition of investments (42,660) (4,037) Bonus notes (992,935) (582,529) ------------ ------------ Cash Used For Investing Activities (2,012,074) (1,199,064) Increase (decrease) in cash and cash equivalents 202,494 (7,805,444) Cash and cash equivalents-beginning of period 6,542,052 12,436,988 ------------ ------------ Cash and Cash Equivalents-end of period $ 6,744,546 $ 4,631,544 ============ ============ Supplemental disclosure of cash flow information: Income tax payments $ 117,360 $ 2,572,760 Interest payments $ 2,836,260 $ 2,536,603
See Notes to Consolidated Financial Statements. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE A - BASIS OF PRESENTATION The consolidated financial statements include the accounts of Stifel Financial Corp. and its wholly owned subsidiaries (collectively referred to as the "Company"). The accompanying unaudited consolidated 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. Operating results for the three and six months ended June 24, 1994 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 1994. For further information, refer to the financial statements and notes thereto included in the Company's report on Form 10-K for the five-month transition period ended December 31, 1993. NOTE B - NET CAPITAL REQUIREMENT As a registered broker-dealer and member of the New York Stock Exchange, the Company's brokerage subsidiary, Stifel, Nicolaus & Company, Incorporated ("SN & Co."), is subject to the Securities and Exchange Commission's ("SEC") uniform net capital rules. SN & Co. has elected to operate under the alternative method of the rule, which prohibits a broker-dealer from engaging in any securities transactions when its net capital is less than 2% of its aggregate debit balances, as defined, arising from customer transactions. The SEC may also require a member firm to reduce its business and restrict withdrawal of subordinated capital if its net capital is less than 4% of aggregate debit balances, and may prohibit a member firm from expanding its business and declaring cash dividends if its net capital is less than 5% of aggregate debit balances. At June 24, 1994, SN & Co. had net capital of $24,331,038 which was 16% of its aggregate debit balances and $21,313,848 in excess of the net capital requirement. NOTE C - INCOME TAXES Effective August 1, 1993, the Company adopted Statement of Financial Accounting Standards (SFAS) No. 109, "Accounting for Income Taxes." This statement requires, among other provisions, that deferred taxes be adjusted to reflect current rates. The adoption of SFAS No. 109 did not have a material effect on the Company's financial condition or results of operations. NOTE D - SUBSEQUENT EVENT On July 19, 1994, the board of directors declared the regular quarterly dividend of $0.03 per share, payable on August 16, 1994 to stockholders of record August 2, 1994. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (all dollars in thousands, except per share amounts) Results of Operations In 1993, the Company changed its fiscal year-end from the last Friday in July to a calendar year-end. The five-month transition period ended December 31, 1993 has been presented in the transition period From 10-K. As a result of this fiscal year-end change, 1993 has been recast for comparative purposes. Three months ended June 1994 and June 1993 The Company recorded a net loss of $731 for the three months ended June 24, 1994, compared to net income of $2,031, for the three months ended June 25, 1993, a decrease of $2,762. The primary loss per share was $0.18 compared to the previous year's primary earnings per share of $0.50, a decrease of $0.68. The decline was primarily attributable to sharply reduced investment banking fee income and a decrease in commissionable revenues. Total revenues, for the three months ended June 24, 1994, decreased $6,728 (22.8%) to $22,746 from $29,474, from the year earlier quarter. Investment banking revenues decreased $6,541 (74.4%), from the same period one year earlier, principally due to decreased municipal bond refundings. Municipal refunding activity had been unusually robust during the past two years as interest rates were declining. During the first half of 1994, as rates began to rise, refunding activity has slowed considerably causing the sharp comparative declines. Commission revenues declined $1,817 (16.0%), principally because of the retail investor's uncertainty of the current market conditions. Agency commission, sale of investment company shares, and sale of unit investment trusts decreased $890 (12.4%), $556 (19.2%), and $459 (56.5%), respectively. The declines were partially offset by the $88 (18.4%) increase in the sale of insurance products. Other revenues increased $927 (56.7%), mostly because of increased investment advisory fees resulting from the late 1993 acquisition of Todd Investment Advisors, Inc. ("Todd"). Net interest income increased $324 (36.8%) to $1,205 from $881, of the prior year. The increase resulted from an increase in margin interest revenues of $660, coming from increased borrowing by customers coupled with higher interest rates. Total expenses for the quarter decreased $2,261 (8.6%), primarily due to reduced compensation and other expenses which vary directly with revenue production. Compensation & benefits and commission & floor brokerage decreased $3,642 (19.8%) and $109 (16.8%), respectively. The majority of the compensation decrease was in the incentive compensation area which decreased, as expected, with the revenue and profit decreases. Occupancy, equipment, communication and supplies expenses increased, $385 a result of management's commitment to expand the retail branch system and the addition of Todd. Retail office locations increased by 7 (10.1%) to a total of 76. These increases were partially offset by a decrease in promotional expenses of $81 (10.1%). Other operating expenses increased a total of $840 (48.7%), mostly due to professional fees and the provision for doubtful accounts which increased $608 and $223, respectively. Six months ended June 1994 and June 1993 The Company incurred a net loss, for the six months ended June 24, 1994 of $552. This compares to net income of $3,428 for the six months ended June 25, 1993. Per share amount decreased $0.98 to a loss of $0.13 per primary share from earnings per primary share of $0.85 in 1993. The diminished results were primarily attributable to lower commission activity, a substantial decline in investment banking activity, and losses in the municipal bond inventories. Total revenues decreased $7,671 (13.6%) to $48,573 from $56,244 from the prior year's six-month period, as a result of decreased investment banking revenues, which decreased $7,714 (51.8%) to $7,187 from $14,901, from the year earlier period. This decline was principally due to sharply decreased municipal bond refunding activity caused by higher market interest rates. Principal transactions decreased $1,320 (11.5%) to $10,160 from the $11,480 recorded in the prior year, due to losses incurred on municipal bond inventories and decreased availability of municipal bond product. Commission revenues decreased $1,175 (5.2%) comprised of agency commission, sale of investment company shares, and sale of unit investment trusts which decreased $776 (5.5%), $244 (4.2%), and $374 (21.8%), respectively. These decreases were partially offset by the sale of insurance products of $219 (22.7%). Other revenues increased $1,654 (55.7%) resulting from gains in investments of $331, compared to unrealized losses of $350, in the year earlier period. Investment advisory fees climbed to $1,323 over last year's $475, an increase of $848 (178.4%), of which Todd attributed $868 of the increase. Net interest income increased $599 (34.2%) to $2,351 from $1,752 of the prior year. The increase resulted from an increase in margin interest revenues of $995, due to increased borrowing by customers coupled with higher interest rates. Total expenses, for the six months ended, decreased $1,393 (2.7%) to $49,508 compared to $50,901 for the prior year's comparable period, primarily due to reduced compensation and other expenses which vary with revenue production. Employee compensation & benefits and commission & floor brokerage decreased $3,893 (11.0%) and $234 (18.6%), respectively. Incentive compensation, Investment Executive compensation, and other variable compensation decreased $5,866 (23.8%), primarily because of decreases in commissionable revenues, investment banking revenues, and overall company profitability. The remaining employee compensation and benefits increased $1,973 (18.4%) due to increased staffing required for the newly opened offices, normal cost of living increases, and increased cost of health care benefits. Occupancy, equipment, communication, and supplies expenses increased $939 for the same reason explained in the three months results of operations ended June 1994. Other operating expenses increased $1,505 (47.1%), largely due to increased professional fees of $1,121 (128.2%) resulting from an ongoing SEC investigation and increased employment and recruitment fees due to management's commitment to seek alternative sources of revenue production. Provision for doubtful accounts increased $212, which resulted from uncertain collectibility of employment notes receivable. Liquidity and Capital Resources The Company's assets are highly liquid, consisting mainly of cash or assets readily convertible into cash. These assets are financed primarily by the Company's equity capital, customer credit balances, short-term bank loans, proceeds from securities lending, long-term senior convertible notes, and other payables. Changes in securities market volumes, related customer borrowing demands, and levels of securities inventory affect the amount of the Company's financing requirements. For the six months ended June 24, 1994, cash and cash equivalents increased $203 (3.1%) to $6,745 from $ 6,542 at December 31, 1993. Cash provided by the decrease in securities owned of $58,853, which resulted principally from lower municipal bond inventories, cash provided by the decrease in operating receivables of $16,414, and cash provided by the increase in operating payables of $15,464 were used primarily for repayment of short-term bank borrowings which decreased $82,700. SN & Co. is subject to requirements of the Securities and Exchange Commission with regard to liquidity and capital requirements (see Note B of the Notes to Consolidated Financial Statements). At June 24, 1994, SN & Co. had net capital of $24,331 which exceeded the minimum net capital requirements by $21,314. Management believes that funds from operations and available unused informal short-term credit arrangements of $151,750, at June 24, 1994, will provide sufficient resources to meet the present and anticipated financial needs. In addition, SN & Co. has obtained a revolving subordinated loan from a financial institution. The subordinated loan will enhance the Company's ability to obtain temporary capital for underwriting and other commitments, if the need arises. Recent market conditions and the low backlog for municipal underwritings have caused commissions, investment banking revenues and related principal transaction revenues to vary significantly downward from prior periods. Correspondingly, variable compensation expense related to the production of these revenues also varied downward. Management does not anticipate that municipal underwriting activity, particularly in the Southwest region, will increase in the near term. Consequently, management is considering the potential for restructuring of certain departments, has taken steps to eliminate fixed costs associated with revenue production, is continuing its effort to grow the number of Investment Executives to increase retail revenue production, and is currently evaluating day-to-day operations for increased efficiencies and cost reduction opportunities. As a result, the Company's future financial condition is expected to remain strong. PART II. OTHER INFORMATION Item 1. Legal Proceedings There were no material changes, during the six months ended June 24, 1994, in the legal proceedings previously reported in the Company's Annual Report on Form 10-K for the year ended December 31, 1993. Such information is hereby incorporated by reference. Item 6. Exhibits and Reports on Form 8-K (a) Exhibit No. (Reference to Sequential Item 601(b) of Regulation S-K) Description Page Number ------------------------------ ------------------- ----------- 11 Computation of 16 Earnings Per Share (b) Reports on Form 8-K There were no reports on Form 8-K filed during the quarter ended June 24, 1994. SIGNATURES Pursuant to the requirement of Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. STIFEL FINANCIAL CORP. (Registrant) Date: August 5, 1994 By /s/ Gregory F. Taylor Gregory F. Taylor (Chief Executive Officer) Date: August 5, 1994 By /s/ Mark D. Knott Mark D. Knott (Principal Financial Officer) EXHIBIT INDEX Exhibit Sequential Number Description Page Number - - ------- ------------------------------------------- ----------- 11 Computation of Earnings Per Share 17 EX-11 2 EXHIBIT 11 STIFEL FINANCIAL CORP. AND SUBSIDIARIES COMPUTATION OF EARNINGS PER SHARE (In Thousands, Except Per Share Amounts) (UNAUDITED)
Three Months Ended June 24, 1994 June 25, 1993 ------------- ------------- Fully Fully Primary Diluted Primary Diluted Net (loss) income $ (731) $ (731) $2,031 $2,031 After-tax interest savings assuming conversion of Senior Convertible Notes (1) - - 168 - - 174 ------ ------ ------ ------ Net income adjusted for after tax interest savings $ (731) $ (563) $2,031 $2,205 ====== ====== ====== ====== Average number of common shares outstanding during the period 3,998 3,998 3,918 3,918 Additional shares assuming exercise of stock options (2) 99 99 139 140 Additional Shares assuming conversion of Senior Convertible Notes (3) - - 1,225 - - 1,225 ------ ------ ------ ------ Average number of common shares used to calculate earnings per share 4,097 5,322 4,057 5,283 ====== ====== ====== ====== Net earnings per share $(0.18) $(0.18)(4) $ 0.50 $ 0.42
Six Months Ended June 24, 1994 June 25, 1993 ------------- ------------- Fully Fully Primary Diluted Primary Diluted Net (loss) income $ (552) $ (552) $3,428 $3,428 After-tax interest savings assumings conversion of Senior Convertible Notes (1) - - 332 - - 349 ------ ------ ------ ------ Net income adjusted for after tax interest savings $ (552) $ (220) $3,428 $3,777 ====== ====== ====== ====== Average number of common shares outstanding during the period 3,996 3,996 3,912 3,912 Additional shares assuming exercise of stock options (2) 121 121 128 140 Additional Shares assuming conversion of Senior Convertible Notes (3) - - 1,225 - - 1,225 ------ ------ ------ ------ Average number of common shares used to calculate earnings per share 4,117 5,342 4,040 5,277 ====== ====== ====== ====== Net earnings per share $(0.13) $(0.13)(4) $ 0.85 $ 0.72 (1)Represents the after-tax interest savings resulting from assumed conversion of $10,000,000 aggregate principal 11.25%Senior Convertible Notes. (2)Represents the number of shares of common stock issuable on the exercise of dilutive employee stock options less the number of shares of common stock which could have been purchased with the proceeds from the exercise of such options. For primary earnings per share computations, these purchases were assumed to have been made at the average market price of the common stock during the period or that part of the period for which the option was outstanding. For fully diluted earnings per share computations, these purchases were assumed to have been made at the greater of the market price of the common stock at the end of the period or average market price of the common stock during the period or that part of the period for which the option was outstanding. (3)Represents the number of shares of common stock issuable upon conversion of $10,000,000 aggregate principal 11.25% Senior Convertible Notes at a conversion price of $8.164 per share. (4)Net fully diluted earnings per share computes to $(0.11) and $(0.04) for three months and six months ended June 24, 1994, respectively. Since this is anti-dilutive, fully diluted earnings per share share.
-----END PRIVACY-ENHANCED MESSAGE-----