-----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, RmGNGRNZxqBQgWCRqSq2HIBjR0PXEClvK1siipA+oBtShM+Kr3BnM0tM/N/8Ik0e DWW9/4qah6f2JdBVq00xXg== 0000730000-98-000004.txt : 19980729 0000730000-98-000004.hdr.sgml : 19980729 ACCESSION NUMBER: 0000730000-98-000004 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980630 FILED AS OF DATE: 19980728 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: SUPERTEX INC CENTRAL INDEX KEY: 0000730000 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 948328535 STATE OF INCORPORATION: CA FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-12718 FILM NUMBER: 98672089 BUSINESS ADDRESS: STREET 1: 1235 BORDEAUX DR CITY: SUNNYVALE STATE: CA ZIP: 94089 BUSINESS PHONE: 4087440100 MAIL ADDRESS: STREET 1: 1235 BORDEAUX DR CITY: SUNNYVALE STATE: CA ZIP: 94089 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 30, 1998 or ( ) Transition Report Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934 (No Fee Required) Commission File No. 0-12718 SUPERTEX, INC. (Exact name of Registrant as specified in its Charter) California 94-2328535 (State or other jurisdiction of (IRS Employer Identification #) incorporation or organization) 1235 Bordeaux Drive Sunnyvale, California 94089 (Address of principal executive offices) Registrant's Telephone Number, Including Area Code: (408) 744-0100 Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12(g) of the Act: Common Stock 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 July 14, 1998, 12,101,688 shares of the Registrant's common stock were issued and outstanding. Total number of pages: 10 SUPERTEX, INC. QUARTERLY REPORT - FORM 10Q Table of Contents Page No. ----------------- -------- PART I - FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Statements of Income..................... 3 Consolidated Balance Sheets........................... 4 Consolidated Statements of Cash Flows................. 5 Notes to Consolidated Financial Statements............ 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations................... 7 PART II- OTHER INFORMATION Item 6. Exhibits, Financial Statement Schedule and Reports on Form 8-K .............................. 8 PART I - FINANCIAL INFORMATION Item 1. Financial Statements SUPERTEX, INC. CONSOLIDATED STATEMENTS OF INCOME (unaudited) (in thousands, except per share amounts)
Three-months Ended, ------------------ June 30, -------- 1998 1997 ---- ---- Net sales $ 13,001 $ 12,313 ------- ------- Cost and expenses: Cost of sales 6,907 6,680 Research and development 1,501 1,376 Selling, general and administrative 1,692 1,634 ------- ------- Total costs and expenses 10,100 9,690 ------- ------- Income from operations 2,901 2,623 Interest income 470 343 Other income(expense), net (29) 28 ------- ------- Income before provision for income taxes 3,342 2,994 Provision for income taxes 1,135 1,018 ------- ------- Net income $ 2,207 $ 1,976 ------- ------- Net income per share: Basic $ 0.18 $ 0.16 ======= ======= Diluted $ 0.18 $ 0.16 ======= ======= Shares used in per share computation: Basic 12,098 12,050 ======= ======= Diluted 12,322 12,379 ======= ======= See accompanying Notes to Consolidated Financial Statements.
SUPERTEX, INC. CONSOLIDATED BALANCE SHEETS (unaudited)
Jun. 30, 1998 Mar. 31, 1998 ------------- ------------- (in thousands) ASSETS Current assets: Cash and cash equivalents $ 22,498 $ 24,556 Short term investments 12,356 6,956 Trade accounts receivable, net of allowances of $706 and $700 8,798 9,784 Other receivables 199 322 Inventories 10,591 10,263 Deferred income taxes 2,181 2,181 Prepaid expenses 205 218 ------- ------- Total current assets 56,828 54,280 Property, plant and equipment, net 12,309 12,349 ------- ------- TOTAL ASSETS $ 69,137 $ 66,629 ======== ========
LIABILITIES
Current liabilities: Trade accounts payable $ 2,922 $ 3,436 Accrued salaries, wages and employee benefits 2,974 3,086 Income taxes payable 2,134 1,080 Other accrued liabilities 314 359 Deferred revenue on shipments to distributors 1,286 1,451 ------- ------- Total current liabilities 9,630 9,412 ------- ------- SHAREHOLDERS' EQUITY Preferred stock, no par value -- 10,000 shares authorized, none outstanding -- -- Common stock, no par value -- 30,000 shares authorized; issued and outstanding 12,102 and 12,097 shares 20,800 20,713 Retained earnings 38,707 36,504 ------ ------ Total shareholders' equity 59,507 57,217 ------ ------ TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 69,137 $ 66,629 ======= ======= See accompanying Notes to Consolidated Financial Statements.
SUPERTEX, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited, in thousands)
Three Months Ended, ------------------ Jun. 30, 1998 Jun. 30, 1997 ------------- ------------- CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 2,207 $ 1,976 -------- -------- Non-cash adjustments to net income: Depreciation and amortization 772 527 Provision for doubtful accounts and sales returns 254 459 Provision for excess and obsolete inventories (161) (71) Changes in operating assets and liabilities: Accounts and other receivables 855 (1,068) Inventories (167) (139) Prepaid expenses 13 (40) Trade accounts payable and accrued expenses (671) (210) Income taxes payable 1,054 928 Deferred revenue on shipments to distributors (165) 172 ----- ----- Total adjustments 1,784 558 ----- ----- Net cash provided by operating activities 3,991 2,534 ----- ----- CASH FLOWS FROM INVESTING ACTIVITIES Purchases of property, plant and equipment (732) (1,026) Purchases of short term investments (11,400) (4,147) Proceeds from maturities of short term investments 6,000 4,000 Other 58 0 ------- ------- Net cash used in investing activities (6,074) (1,173) ------- ------- CASH FLOWS FROM FINANCING ACTIVITIES Stock options exercised 25 19 ------- ------- Net cash provided by financing activities 25 19 ------- ------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (2,058) 1,380 CASH AND CASH EQUIVALENTS: Beginning of period 24,556 19,166 -------- -------- End of period $ 22,498 $ 20,546 ======== ======== See accompanying Notes to Consolidated Financial Statements.
SUPERTEX, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1 - ------ In the opinion of management, the unaudited financial statements for the three months ended June 30, 1998 and 1997 include all adjustments (consisting of normal recurring adjustments) necessary for fair presentation of financial condition and results of operations for those periods in accordance with generally accepted accounting principles. The year-end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles. These financial statements should be read in conjunction with the audited financial statements of Supertex, Inc. for the fiscal year ended March 31, 1998, which were included in the Annual Report on Form 10-K (File Number 0-12718). Interim results are not necessarily indicative of results for the full fiscal year. Note 2 - ------ Inventories consisted of (in thousands): June 30, 1998 March 31, 1998 ------------- -------------- (unaudited) Finished goods......................... $ 3,836 $ 2,919 Work-in-process........................ 5,797 6,200 Raw materials.......................... 958 1,144 ------- ------- $ 10,591 $ 10,263 ======= ======= Note 3 - ------ Net Income per Share. Basic EPS is computed as net income divided by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur from common shares issuable through stock options, warrants, and other convertible securities. The following is a reconciliation of the numerator (net income) and the denominator (number of shares) used in the basic and diluted EPS calculations. For Three-months Ended, June 30, 1998 1997 ---- ---- BASIC: Weighted average shares outstanding for the period 12,098 12,050 Net income $ 2,207 $ 1,976 -------- -------- Net income per share $ 0.18 $ 0.16 ======== ======== DILUTED: Weighted average shares outstanding for the period 12,098 12,050 Common stock equivalents 224 329 ------ ------ Total common and common equivalent shares 12,322 12,379 ------ ------ Net income $ 2,207 $ 1,976 ------- ------- Net income per share $ 0.18 $ 0.16 ======= ======= PART I - FINANCIAL INFORMATION Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations Certain Factors. This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21 E of the Securities Exchange Act of 1934. Actual future results could differ materially from those discussed here and elsewhere in this report. Factors that could affect future results include general economic conditions, both in the United States and foreign markets, economic conditions specific to the semiconductor industry, the Company's ability to introduce new products, its ability to enhance existing products, its ability to meet the continually changing requirements of its customers, its ability to manufacture efficiently, its ability to control costs, and its ability to maintain and enhance relationships with its assembly and test subcontractors and independent distributors and sales representatives. Results of Operations Net Sales. Net sales for the quarter ended June 30, 1998 were $13,001,000, a 6% increase from $12,313,000 of the same quarter last year. The Company's sales growth has been generated principally by new product introductions in the Company's targeted markets of medical ultrasound imaging, telecommunications, and flat panel displays. In this quarter, approximately 56% of the Company's net sales were derived from customers outside the United States. All of the company's sales to international customers were denominated in U.S. currencies. There was no currency exchange exposure, however as the US dollar continues to be strong against other currencies, many international customers requested and received modest price concessions. Gross Profit. The Company's gross profit for the quarter was $6,094,000, compared with $5,633,000 in the same quarter of last year. As a percent of net sales, gross margin for the quarter was 47%, a 1% increase from 46% when compared with the same quarter last fiscal year, primarily due to cost control measures taken. Research and Development. Research and development expenses increased 9% to $1,501,000 for the quarter ended June 30, 1998 as compared with $1,376,000 for the same quarter of last year. As a percent of sales, research and development expenditures increased slightly to 12% compared to 11% for the same quarter last year. The increase was related to new product development and the Company expects that new product development expenses will increase during this fiscal year. Selling, General and Administrative. Expenses for selling, general and administrative were flat at $1,692,000, or 13% of net sales, compared with $1,634,000, also 13%, in the same quarter of last fiscal year. The dollar increase in this category was due to a slight increase in payroll expenses as a result of headcount increase in the sales department. Interest and Other Income. Interest and other income for this period were $441,000 compared with $371,000 last year. Higher amount of funds available for investments contributed to this increase in interest and other income. Provision for Income Taxes. The Company's effective tax rate for the three months ended June 30, 1998 remained at 34% compared to the same period last year. Overview. Total assets grew to $69,137,000 as of June 30, 1998, up from $66,629,000 from quarter ending March 31, 1998. The increase is due to favorable operating results for the quarter. Liquidity and Capital Resources. On June 30, 1998, the Company had $34,854,000 in cash, cash equivalents, and short term investments, compared with $31,512,000 on March 31, 1998. This increase is mostly due to positive cash flow from operating activities of $3,991,000 consisting principally of net income of $2,207,000 plus depreciation of $772,000, provision for doubtful accounts and sales returns of $254,000, decrease in receivables and prepaid expenses of $868,000 and an increase in liability accounts of $218,000, and partially offset by an increase in inventories of $167,000 and an increase in the provision for obsolescence of $161,000. Net cash used in investing activities in the first quarter of 1998 was $6,074,000 which consisted primarily of purchases of short term investments and purchases of equipment. Net cash provided by financing activities was $25,000 which consists of proceeds from exercises of stock options. The Company anticipates that available funds and cash expected to be generated from operations will be sufficient to meet cash and working capital requirements through the end of fiscal year 1999. Year 2000 Compliance Risks. The Company is aware of the issues associated with the programming code in existing computer systems and software products as the millennium (year 2000) approaches. The "year 2000" problem is pervasive and complex, as virtually every computer operation will be affected in the same way by the rollover of the two digit year value to 00. The issue is whether computer systems will properly recognize date-sensitive information when the year changes to 2000. Systems that do not properly recognize such information could generate erroneous data or cause a system to fail. As a result, many companies' software, computer systems and other equipment may need to be upgraded or replaced in order to comply with such "Year 2000" requirements. The Company is utilizing both internal and external resources to identify, correct or reprogram, and test the systems for year 2000 compliance. It is anticipated that all reprogramming efforts will be completed by December 31, 1999, including and allowing adequate time for testing. This process includes getting confirmations from the Company's primary vendors that plans are being developed or are already in place to address processing of transactions in the year 2000. However, there can be no assurance that the systems of other companies on which the Company's systems rely will also be converted in a timely manner or that any such failure to convert by another company would not have an adverse effect on the Company's systems. Additionally, the Company's net sales could be adversely affected if the Company's customers or potential customers reallocate spending from the Company's products to their efforts to resolve the Year 2000 issue. Finally, the Company utilizes third-party equipment and software that may not be Year 2000 compliant. Although preliminary estimates indicate that the Year 2000 issue will not have a material impact on the Company, there can be no assurance that the Year 2000 issue, due to the above factors or other unforeseen consequences, will not have a material adverse effect on the Company's business, financial condition and operating results. PART II - OTHER INFORMATION Item 6. - Exhibits and Reports on Form 8-K (a) Exhibits 27.1 Financial Data Schedule (b) Reports on Form 8-K. None. SIGNATURE 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. SUPERTEX, INC. (Registrant) Date: July 27, 1998 By: /s/ Henry C. Pao --------------------------- Dr. Henry C. Pao, President (Principal Executive and Financial Officer) EX-27 2 ARTICLE 5 FINANCIAL DATA SCHEDULE FOR 1ST QTR. 10-Q WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
5 1,000 Supertex, Inc. Financial Data Schedule For Three Months ended June 30, 1998 (in thousands) 3-MOS MAR-31-1999 JUN-30-1998 22,498 12,356 9,504 706 10,591 56,828 27,369 15,060 69,137 9,630 0 0 0 20,800 38,707 69,137 13,001 13,001 6,907 10,100 0 35 0 3,342 1,135 2,207 0 0 0 2,207 .18 .18
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