-----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, GtMxB8jVQxOGp5fj8TwNqunicgDS4GHBq5O42vWLK98WluBLeJxMZyTGzY8bWfP8 Jelj+MDP6FicoAhEWEBTrg== 0000950134-96-003653.txt : 19960724 0000950134-96-003653.hdr.sgml : 19960724 ACCESSION NUMBER: 0000950134-96-003653 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960628 FILED AS OF DATE: 19960723 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: VERTEX COMMUNICATIONS CORP /TX/ CENTRAL INDEX KEY: 0000780416 STANDARD INDUSTRIAL CLASSIFICATION: RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT [3663] IRS NUMBER: 751982974 STATE OF INCORPORATION: TX FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-15277 FILM NUMBER: 96597636 BUSINESS ADDRESS: STREET 1: 2600 N LONGVIEW ST STREET 2: PO BOX 1277 CITY: KILGORE STATE: TX ZIP: 75662 BUSINESS PHONE: 9039840555 10-Q 1 FORM 10-Q FOR PERIOD ENDED JUNE 28, 1996 1 ================================================================================ UNITED STATES 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 28, 1996 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: 0-15277 VERTEX COMMUNICATIONS CORPORATION (Exact name of Registrant as specified in its charter) TEXAS 75-1982974 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 2600 N. LONGVIEW STREET, KILGORE, TEXAS 75662 (Address of principal executive offices and zip code) (903) 984-0555 (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 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 --------- --------- Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. AS OF JUNE 28, 1996, THERE WERE 4,427,356 SHARES OUTSTANDING OF THE REGISTRANT'S COMMON STOCK $.10 PAR VALUE. ================================================================================ 2 VERTEX COMMUNICATIONS CORPORATION TABLE OF CONTENTS TO FORM 10-Q FOR THE THREE MONTHS ENDED JUNE 28, 1996 PART I - FINANCIAL INFORMATION Item 1. Financial Statements - (Unaudited) Condensed Consolidated Balance Sheets - June 28, 1996 and September 30, 1995 Condensed Consolidated Statements of Income - Three months ended June 28, 1996 and June 30, 1995 Condensed Consolidated Statements of Income - Nine months ended June 28, 1996 and June 30, 1995 Condensed Consolidated Statements of Cash Flows - Nine months ended June 28, 1996 and June 30, 1995 Notes to Condensed Consolidated Financial Statements - June 28, 1996 Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K SIGNATURE 3 VERTEX COMMUNICATIONS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share amounts)
June 28 September 30 1996 1995 ----------- ------------ ASSETS (Unaudited) * CURRENT ASSETS Cash and equivalents $ 12,892 $ 14,870 Accounts receivable, net 20,623 16,295 Inventories (Note B) 15,379 14,324 -------- -------- 48,894 45,489 PROPERTY AND EQUIPMENT, at cost 22,908 20,798 Less accumulated depreciation (9,960) (8,400) -------- -------- 12,948 12,398 GOODWILL, less accumulated amortization of $538 and $268 4,879 5,149 Other assets 626 818 -------- -------- TOTAL ASSETS $ 67,347 $ 63,854 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 3,282 $ 2,883 Accrued compensation 1,968 1,799 Other accrued liabilities 3,391 4,935 Customers' advances 2,405 2,015 Deferred income taxes 1,030 461 -------- -------- 12,076 12,093 ACQUISITION INDEBTEDNESS 875 1,312 DEFERRED INCOME TAXES 763 763 COMMITMENTS AND CONTINGENCIES --- --- SHAREHOLDERS' EQUITY Common stock, ($.10 par value, 20,000,000 shares authorized, 4,661,402 shares issued) 466 466 Capital in excess of par value 24,829 24,963 Retained earnings 31,195 26,758 Treasury stock, at cost, (234,046 shares in June; 230,146 shares in September) (2,871) (2,700) Translation adjustment 14 199 -------- -------- 53,633 49,686 -------- -------- TOTAL LIABILITIES AND EQUITY $ 67,347 $ 63,854 ======== ========
* The balance sheet at September 30, 1995 has been taken from audited financial statements at that date and condensed. 1 4 VERTEX COMMUNICATIONS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (In thousands, except per share amounts)
Three Months Ended June 28 June 30 1996 1995 ---------- ---------- NET SALES $ 19,109 $ 15,934 COSTS AND EXPENSES: Cost of sales 13,997 11,586 Research and development 705 595 Marketing 1,007 1,045 General and administrative 1,364 1,086 ---------- ---------- 17,073 14,312 ---------- ---------- OPERATING INCOME 2,036 1,622 OTHER INCOME (EXPENSE): Income from investments 160 138 Interest expense (26) (36) ---------- ---------- INCOME BEFORE INCOME TAXES 2,170 1,724 Provision for income taxes 586 479 ---------- ---------- NET INCOME $ 1,584 $ 1,245 ========== ========== EARNINGS PER SHARE $ .34 $ .28 ========== ========== AVERAGE SHARES AND EQUIVALENT SHARES OUTSTANDING 4,650 4,512 ========== ==========
2 5 VERTEX COMMUNICATIONS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (In thousands, except per share amounts)
Nine Months Ended June 28 June 30 1996 1995 -------- -------- NET SALES $ 57,306 $ 46,899 COSTS AND EXPENSES: Cost of sales 41,898 34,343 Research and development 2,374 1,681 Marketing 2,982 2,824 General and administrative 4,221 3,209 -------- -------- 51,475 42,057 -------- -------- OPERATING INCOME 5,831 4,842 OTHER INCOME (EXPENSE): Income from investments 494 457 Interest expense (78) (61) -------- -------- INCOME BEFORE INCOME TAXES 6,247 5,238 Provision for income taxes 1,810 1,500 -------- -------- NET INCOME $ 4,437 $ 3,738 ======== ======== EARNINGS PER SHARE $ .96 $ .82 ======== ======== AVERAGE SHARES AND EQUIVALENT SHARES OUTSTANDING 4,642 4,572 ======== ========
3 6 VERTEX COMMUNICATIONS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (In thousands)
Nine Months Ended June 28 June 30 1996 1995 ------------ ----------- CASH FLOWS FROM OPERATING ACTIVITIES $ 875 $ 2,617 CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property and equipment (2,110) (1,706) Payment for business purchased in fiscal 1995 (438) (5,597) ---------- --------- (2,548) (7,303) CASH FLOWS FROM FINANCING ACTIVITIES: Purchase of treasury stock (436) (3,186) Other 131 151 ---------- --------- (305) (3,035) ---------- --------- DECREASE IN CASH AND EQUIVALENTS (1,978) (7,721) CASH AND EQUIVALENTS: At beginning of period 14,870 20,527 ---------- --------- AT END OF PERIOD $ 12,892 $ 12,806 ========== =========
4 7 VERTEX COMMUNICATIONS CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE A - BASIS OF PRESENTATION The accompanying condensed 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 Article 10 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 the adjustments (consisting of normal recurring accruals) considered necessary for fair presentation have been included. 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 September 30, 1995. NOTE B - INVENTORIES (IN THOUSANDS) The components of inventory consist of the following:
June 28 September 30 1996 1995 ----------------- ------------------ Raw Materials $ 5,760 $ 4,476 Work-In-Process 8,009 8,661 Finished Goods 1,610 1,187 -------- -------- $ 15,379 $ 14,324 ======== ========
NOTE C - ACQUISITION On January 25, 1995 (effective January 1, 1995), the Company acquired all of the outstanding common stock of Maxtech, Inc. by purchase. Below are the unaudited pro forma results of operations prepared by management, as if the acquisition had occurred on October 1, 1994.
Nine Months Ended June 30, 1995 ------------------ Net Sales $ 48,265,000 Net Income $ 3,659,000 Earnings Per Share $ .80
5 8 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION RESULTS OF OPERATIONS QUARTER ENDED JUNE 28, 1996 Third quarter net sales increased 20 percent over the same quarter last year as a result of increased product demand. Research and development expenses were up 18 percent over the third quarter last year primarily due to new product design efforts in the small aperture antenna product line. General & administrative and marketing expenses increased 11 percent from the comparable quarter reflecting the addition of two new operating divisions. Net income of $1.6 million surpassed the record profits achieved in the second quarter of fiscal 1996 and was 27 percent more than the same quarter one year earlier. RESULTS OF OPERATIONS NINE MONTHS ENDED JUNE 28, 1996 Net sales increased 22 percent compared to the same nine-month period last year primarily due to the acquisition of Maxtech and increased product demand. Research and development spending increased by 41 percent from the comparable period because of 9 meter antenna development work, start-up of two new operating divisions, and the inclusion of Maxtech for the full nine-month period of fiscal 1996. Marketing and G & A expenses increased by 19 percent when compared to the nine months ended June 30, 1995 mainly as a result of the Maxtech acquisition and start-up of the two new operating divisions. Higher net income of $4.4 million compared to $3.7 million over same period one year earlier, was caused largely by increased sales volume. The effective tax rate for fiscal 1996 is lower than the prescribed statutory rates mainly due to the effect of tax incentives available from export shipments and certain investment income that is nontaxable. FINANCIAL CONDITION During the nine months ended June 28, 1996, the balance of cash and cash equivalents decreased by $2 million principally due to investment in equipment used to expand manufacturing capabilities. Management believes that forecasted cash flows combined with the Company's strong financial condition will be sufficient to fund operations and planned capital investments for the foreseeable future. The company is not aware of any demands which are likely to impact liquidity in an adverse manner. 6 9 PART II - OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits: Exhibit 27 - Financial Data Schedule (b) Form 8-K: The Company filed no reports on Form 8-K and none were required to be filed during the three months ended June 28, 1996. 7 10 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. VERTEX COMMUNICATIONS CORPORATION --------------------------------- (Registrant) Date: July 23, 1996 /s/ J. D. Carter --------------------------------- J. D. Carter Vice President - Finance (Duly Authorized Officer and Principal Financial and Accounting Officer) 8 11 INDEX TO EXHIBITS
EXHIBIT NUMBER DESCRIPTION - ------- ----------- 27 - Financial Data Schedule
EX-27 2 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE COMPANY'S FINANCIAL STATEMENTS FOR THE NINE MONTHS ENDED JUNE 28, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 9-MOS SEP-30-1996 OCT-01-1995 JUN-28-1996 12,892 0 20,860 237 15,379 48,894 22,908 9,960 67,347 12,076 0 466 0 0 53,167 67,347 57,306 57,306 41,898 41,898 9,577 0 78 6,247 1,810 4,437 0 0 0 4,437 .96 .96
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