-----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, GQ7Bx7xwgRu91nZQ+WB9NKWqS07xO2PKONYuk7DVo/TUCQM4DG8IkMyWFPABmHhi iD4Nw/ROBVXBNmeCPwYXRQ== 0000008137-95-000008.txt : 19950814 0000008137-95-000008.hdr.sgml : 19950814 ACCESSION NUMBER: 0000008137-95-000008 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950630 FILED AS OF DATE: 19950811 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: ATKINSON GUY F CO OF CALIFORNIA CENTRAL INDEX KEY: 0000008137 STANDARD INDUSTRIAL CLASSIFICATION: HEAVY CONSTRUCTION OTHER THAN BUILDING CONST - CONTRACTORS [1600] IRS NUMBER: 941649018 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-03062 FILM NUMBER: 95561299 BUSINESS ADDRESS: STREET 1: 1001 BAYHILL DR STREET 2: P O BOX 593 CITY: SAN BRUNO STATE: CA ZIP: 94066 BUSINESS PHONE: 4158761000 MAIL ADDRESS: STREET 1: P O BO 593 STREET 2: S SAN FRANCISCO 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended June 30, 1995 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 0-3062 GUY F. ATKINSON COMPANY OF CALIFORNIA (Exact name of registrant as specified in its charter) STATE OF DELAWARE (State or other jurisdiction of 94-1649018 incorporation or organization) (IRS Employer Identification No.) 1001 Bayhill Drive, San Bruno, California 94066 (Address of principal executive offices) (zip code) Registrants' telephone number, including area code - (415) 876-1000 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, and (2) has been subject to such filing requirements for the past 90 days. Yes X No Common stock as of August 11, 1995 Issued and outstanding - 8,951,154 shares ATKINSON COMPANY OF CALIFORNIA AND SUBSIDIARY COMPANIES PART I - FINANCIAL INFORMATION Item 1. Financial Statements
Consolidated Balance Sheets June 30, December 31, (thousands of dollars) 1995 1994 (unaudited) ASSETS Current Assets: Cash and short-term investments $ 73,310 $ 78,441 Accounts receivable 43,210 33,150 Costs and estimated earnings in excess of billings 2,646 4,338 Inventories and unamortized costs on contracts in progress 19,171 20,062 Investments in joint ventures 37,600 40,503 Deferred income taxes 12 23 Other current assets 3,663 3,163 Total current assets 179,612 179,680 Property, plant and equipment, at cost 48,749 51,896 Less accumulated depreciation 25,723 34,345 23,026 17,551 Deferred income taxes 90 88 Other assets 3,663 2,395 $ 206,391 $199,714 LIABILITIES Current Liabilities: Notes payable, including current portion of long-term obligations $ 563 $ 662 Accounts payable 54,708 43,998 Billings in excess of costs and estimated earnings 35,231 16,920 Accrued expenses 22,424 24,240 Accrued federal & foreign income taxes 4,232 6,953 Due to joint ventures 127 103 Total current liabilities 117,285 92,876 Long-term obligations, less current portion 1,886 2,199 Postemployment benefit obligations and postretirement health care obligations 7,651 7,651 Total liabilities 126,822 102,726 STOCKHOLDERS' EQUITY Capital stock 1,894 1,894 Paid-in capital 12,857 13,185 Accumulated translation adjustment (4,600) (5,249) Unearned compensation (375) (736) Retained earnings 69,793 87,894 79,569 96,988 $ 206,391 $ 199,714 See accompanying notes
GUY F. ATKINSON COMPANY OF CALIFORNIA AND SUBSIDIARY COMPANIES
Consolidated Statements of Operations (unaudited) (thousands of dollars except per share amounts) Quarter Ended Six Months Ended June 30, June 30, 1995 1994 1995 1994 Revenue $ 86,434 $123,429 $176,172 $250,600 Cost of revenue 79,170 116,393 161,970 237,715 Gross margin 7,264 7,036 14,202 12,885 General and administrative expense 8,882 9,158 17,687 17,667 (Loss) from operations (1,618) (2,122) (3,485) (4,782) Other income (expense), net: Interest expense (57) (653) (258) (1,520) Miscellaneous, net 2,086 (118) 3,216 823 Total other income (expense), net 2,029 (771) 2,958 (697) Income (loss) from continuing operations before taxes and the cumulative effect of changes in accounting 411 (2,893) (527) (5,479) (Benefit) for income taxes (based on estimated annual effective tax rates) (310) (229) (261) (686) Income (loss) from continuing operations before the cumulative effect of changes in accounting 721 (2,664) (266) (4,793) Discontinued operations, net of income taxes - 1,670 - 3,041 Income (loss) before the cumulative effect of changes in accounting 721 (994) (266) (1,752) Cumulative effect of changes in accounting: Postemployment benefit costs - - - (739) Net income (loss) $ 721 $ (994) $ (266) $ (2,491) See accompanying notes
GUY F. ATKINSON COMPANY OF CALIFORNIA AND SUBSIDIARY COMPANIES
Consolidated Statements of Operations (unaudited), continued (thousands of dollars except per share amounts) Quarter Ended Six Months Ended June 30, June 30, 1995 1994 1995 1994 Income (loss) per share of common stock from continuing operations before the cumulative effect of changes in accounting $ 0.08 $ (0.30) $ (0.03) $ (0.54) Income per share of common stock from discontinued operations - 0.19 - 0.34 Income (loss) per share of common stock before the cumulative effect of changes in accounting 0.08 (0.11) (0.03) (0.20) Cumulative effect of changes in accounting per share - - - (0.08) Net income (loss) per share $ 0.08 $ (0.11) $ (0.03) $ (0.28) Average number of shares and common stock equivalents utilized in net income per share calculations 9,033 8,780 8,917 8,827 See accompanying notes GUY F. ATKINSON COMPANY OF CALIFORNIA AND SUBSIDIARY COMPANIES
Consolidated Statements of Cash Flows (unaudited) (thousands of dollars) Six Months Ended June 30, 1995 1994 Operating activities: Net (loss) $ (266) $ (2,491) Adjustments to reconcile net income to net cash provided by (used for) operating activities: Income from discontinued operations - (3,041) Depreciation, depletion and amortization 1,242 1,076 Deferred income taxes 7 3 Net (gain) on dispositions of property, plant and equipment (2,821) (499) Cumulative effect of changes in accounting - 739 Changes in operating assets and liabilities: Accounts receivable (10,084) 11,286 Inventories and unamortized costs 865 1,258 Investments in joint ventures 2,918 (3,663) Other current assets (505) (1,767) Accounts payable and accrued expenses 9,010 7,540 Accrued income taxes (2,682) 76 Billings in excess of costs and estimated earnings, net 20,002 (2,115) Other, net 55 (113) Net cash provided by operating activities from continuing operations 17,741 8,289 Net cash (used in) operating activities from discontinued operations - (8,844) Net cash provided by (used in) operating activities 17,741 (555) Investing activities: Property, plant and equipment expenditures (10,470) (862) Proceeds from dispositions of property, plant and equipment 6,651 568 Decrease (increase) in other assets, net (1,269) (718) Net investing activities of discontinued operations - (1,569) Net cash (used in) investing activities (5,088) (2,581) Financing activities: Cash dividends paid (17,835) - Short-term borrowing repayments, net - 4,653 Long-term debt repayments (412) (294) Net cash by (used in) financing activities (18,247) 4,359 Effect of exchange rate changes on cash 463 (1,205) Net increase (decrease) in cash and short-term investments $ (5,131) $ 18 Supplementary information: Cash paid during the period for: Interest $ 293 $ 801 Federal, foreign and state income taxes 3,857 (523) See accompanying notes
GUY F. ATKINSON COMPANY OF CALIFORNIA AND CONSOLIDATED SUBSIDIARIES Notes to Condensed Financial Statements (all dollar amounts are in thousands) 1. The information furnished reflects all adjustments which are, in the opinion of management, necessary to a fair statement of results for the interim periods. 2. During 1994, the company sold its principal manufacturing subsidiary, Lake Center Industries, Inc., its pipe distribution business, Comco Pipe & Supply Company, and its oil and gas investments. The results of operations of these divested businesses are shown separately in the income statement for 1994 as "Discontinued operations, net of income taxes". The summarized results of discontinued operations were as follows: Quarter Ended Six Months Ended June 30, 1994 June 30, 1994 Revenue $ 49,170 $ 91,877 Income from discontinued operations before taxes 2,726 4,880 Provision for income taxes 1,056 1,839 Income from discontinued operations $ 1,670 $ 3,041 Income per share of common stock from discontinued operations $ 0.19 $ 0.34 GUY F. ATKINSON COMPANY OF CALIFORNIA AND CONSOLIDATED SUBSIDIARIES Notes to Condensed Financial Statements (all dollar amounts are in thousands) 3. The major classifications of inventory are as follows: June 30, December 31, 1995 1994 Construction materials, parts and supplies $ 3,208 $ 3,724 Unamortized costs on contracts in progress 15,963 16,338 $ 19,171 $20,062 4. In 1994, the company recorded an accounting charge of $739 for postemployment benefits upon the adoption of Statement of Financial Accounting Standards No. 112. 5. On March 31, 1995, the company paid a special cash dividend of $2.00 per share to shareholders of record on March 15, 1995. 6. The company has 40,000 shares of restricted stock outstanding pursuant to the provisions of the Guy F. Atkinson Company of California Executive Stock Plan. Restrictions on the shares are progressively removed based on achievement of earnings per share performance goals. GUY F. ATKINSON COMPANY OF CALIFORNIA AND CONSOLIDATED SUBSIDIARIES Notes to Condensed Financial Statements (all dollar amounts are in thousands) 6. (continued) In the event that performance goals are not achieved, the restricted shares are progressively subject to forfeiture. The market value of the outstanding restricted shares has been recorded as unearned stock grant compensation, a separate component of stockholders' equity. The unearned compensation will be charged to general and administrative expense as the performance goals are met. At June 30, 1995 no such amounts have been charged. At June 30, 1995, the company had options outstanding with respect to 735,152 shares of common stock at exercise prices ranging from $6.55 to $11.95 per share. The right to exercise these options vests progressively over a four year period commencing with the date of issue and expiring ten years from the date of issue. In addition, there were stock warrants outstanding for 387,500 shares of common stock with an exercise price of $7.00 expiring in 1998. GUY F. ATKINSON COMPANY OF CALIFORNIA AND CONSOLIDATED SUBSIDIARIES Notes to Condensed Financial Statements (all dollar amounts are in thousands) 7. Net primary earnings per share of common and common stock equivalents are calculated using the weighted average number of common shares outstanding, excluding restricted shares for which performance goals have not been met, plus the net additional number of shares which would be issuable upon the exercise of stock options and warrants, assuming that the company used the proceeds received to repurchase outstanding shares at market prices. 8. On March 7, 1995, a complaint asserting breach of contract and other wrongdoing in connection with the company's sale of its manufacturing subsidiary, Lake Center Industries, Inc., was filed against the company and its financial advisor by an unsuccessful bidder for Lake Center. The plaintiffs allege they have suffered actual damages of $290 in connection with preparing their bid and also seek to recover $7,000 on a theory of unjust enrichment, together with an additional $10,000 in punitive damages. The company will vigorously defend this suit, which it believes to be without merit and further believes that the outcome will not have a material adverse effect on its financial condition. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations (all dollar amounts are in thousands unless otherwise stated) Quarter ended June 30, 1995 vs. quarter ended June 30, 1994 Revenue: The company's revenue of $86 million in the second quarter of 1995 was 30% lower than the corresponding figure of $123 million in the second quarter of 1994. This reduction in revenue was attributable to the completion of certain industrial construction projects in 1994, while new contract awards (amounting to $360 million in the first two quarters of 1995) are not yet making a significant contribution to revenue. The backlog of uncompleted contracts amounted to $495 million at June 30, 1995, representing an increase of 65% over the restated June 30, 1994 backlog of $300 million. The restatement of June 30, 1994 backlog is in respect of a $293 million contract award which was removed from backlog due to its unlikely prospects of proceeding. Gross margin: The company's gross margin of $7,264 increased by 3% in the second quarter of 1995 over the corresponding $7,036 in 1994. The percentage of gross margin to revenue increased to 8.4% in 1995 from 5.7% in 1994 reflecting a more profitable mix of construction contracts in 1995. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, continued General and administrative expense: General and administrative expenses of $8,882 were 3% lower than the corresponding figure of $9,158 in 1994. This was due to reductions in corporate overhead expense implemented in the fourth quarter of 1994, somewhat offset by the cost of increased construction business development efforts for Asia, the Middle East and South America, as well as the ongoing costs of implementation of the company's new accounting and information systems. Other income (expense): Interest expense decreased to $57 in the second quarter of 1995, from $653 in the second quarter of 1994, primarily due to the company having retired all of its short-term debt in the fourth quarter of 1994. Miscellaneous income of $2,086 in 1995 was principally due to gains from the disposition of property and other surplus assets, amounting to $1,900, together with interest income net of losses on foreign exchange. Income taxes and net income: The company had income from continuing operations before taxes and the cumulative effect of changes in accounting of $411 in 1995 compared to a loss of $2,893 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, continued in 1994. Income taxes gave rise to a benefit of $310 in 1995 compared to a benefit of $229 in 1994. The 1995 tax benefit was due to the recovery of foreign income taxes previously paid, while the 1994 tax benefit was due to the allocation of income taxes to discontinued operations. In 1994, discontinued operations, net of income taxes, provided income of $1,670. Net income for the second quarter of 1995 was $721, compared to a net loss of $994 for the corresponding period of 1994. Six months ended June 30, 1995 vs. six months ended June 30, 1994 Revenue: The company's revenue of $176 million was 30% lower than the corresponding figure of $251 million in 1994, for the same reasons outlined in the previous discussion of revenue for the quarter ended June 30, 1995. Gross margin: The company's gross margin of $14,202 increased by 10% in the six month period of 1995 over the Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, continued corresponding figure of $12,885 in 1994. The percentage of gross margin to revenue improved to 8.1% in 1995 from 5.1% in 1994 reflecting the company's increasing focus on higher margin construction projects. General and administrative expense: General and administrative expense of $17,687 was essentially unchanged from the $17,667 recorded in 1994. The effect of reduced corporate overhead was offset by increased business development efforts as noted in the discussion of general and administrative expense for the quarter. Other income (expense): Interest expense declined to $258 in 1995 from $1,520 in 1994 due to the absence of short-term debt on the company's balance sheet in 1995. Miscellaneous income of $3,216 in 1995 was attributable to gains from the disposition of surplus assets of $1,900 and net interest income of $1,826, less foreign exchange losses and other miscellaneous expenses of $510. In 1994, miscellaneous income of $823 was derived from gains on asset sales of $450, together with foreign exchange gains and other miscellaneous income of $373. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, continued Income taxes and net income: The company had a loss from continuing operations before taxes and the cumulative effect of changes in accounting of $527 in 1995 compared to a loss of $5,479 in 1994. Income taxes resulted in a benefit of $261 in 1995 compared to a benefit of $686 in 1994. The 1995 tax benefit was due to the recovery of foreign income taxes previously paid, while the 1994 tax benefit was due to the allocation of income taxes to discontinued operations. In 1994, discontinued operations, net of income taxes, provided income of $3,041, while the adoption of Statement of Financial Accounting Standards No. 112 resulted in an accounting charge of $739. Net loss for the six month period of 1995 was reduced to $266 from $2,491 in the corresponding period of 1994. Liquidity and Capital Resources The company's operating activities generated cash of $17,741 in the six month period of 1995 compared with $8,289 from Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, continued continuing operating activities in the comparable period of 1994. Net investing activities in 1995 used $5,088 of cash, which, together with a special $2.00 per share dividend payment (amounting to $17,835) resulted in a net decrease in cash and short-term investments of $5,131. In 1994, the cash from continuing operating activities of $8,289, together with net borrowings of $4,359, were used to fund investing activities and discontinued operations. As of June 30, 1995, the company's short-term lines of credit amounted to approximately $33,644. The availability of these lines of credit is reduced by any letters of credit outstanding under the lines. At June 30, 1995, the company had no outstanding borrowings and $6,982 in outstanding letters of credit. The company believes that its cash and short-term investments, together with lines of credit and funds generated from operations will be adequate to cover foreseeable future requirements. GUY F. ATKINSON COMPANY OF CALIFORNIA AND CONSOLIDATED SUBSIDIARIES SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant had duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. GUY F. ATKINSON COMPANY OF CALIFORNIA S/ Herbert D. Montgomery Senior Vice President, Chief Financial Officer and Treasurer August 11, 1995 EX-27 2
5 1000 6-MOS DEC-31-1995 JUN-30-1995 3,715 69,575 43,210 0 19,171 179,612 48,749 25,723 206,391 117,285 1,886 1,894 0 0 77,675 206,391 0 176,172 0 161,970 17,687 0 258 (527) (261) (266) 0 0 0 (266) .03 0
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