-----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, R5x+0NuU/6v/r/ovjkGIVBGrtvBDAqvnlUOf8L2oY3e9i041cnS7WRcKoRGJ79WZ 4XA2S0TDLX3THC5ESTcjEg== 0000008137-96-000005.txt : 19960816 0000008137-96-000005.hdr.sgml : 19960816 ACCESSION NUMBER: 0000008137-96-000005 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960814 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: 96611690 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, 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 0-3062 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 13, 1996 Issued and outstanding - 8,976,467 shares PART I - FINANCIAL INFORMATION Item 1. Financial Statements Guy F. Atkinson Company of California Consolidated Balance Sheets (in thousands of dollars except share and per share amounts) June 30, December 31, 1996 1995 (unaudited) ASSETS Current assets Cash and short-term investments $3,909 $39,804 Accounts receivable 112,867 76,196 Costs and estimated earnings in excess of billings 7,695 28,751 Inventories and unamortized costs on contracts 26,068 20,987 Investments in joint ventures 37,109 32,272 Other current assets 6,361 5,244 Total current assets 194,009 203,254 Property, plant and equipment At cost: Land 2,570 2,683 Buildings 10,387 11,203 Construction equipment 34,582 36,036 Other equipment 8,318 7,478 55,857 57,400 Less accumulated depreciation 28,356 28,163 Total property, plant and equipment, net 27,501 29,237 Other assets 2,354 2,353 Total assets $223,864 $234,844 See accompanying notes Page 1 Guy F. Atkinson Company of California Consolidated Balance Sheets (in thousands of dollars except share and per share amounts) June 30, December 31, 1996 1995 (unaudited) LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Notes payable, including current portion of long-term debt $3,006 $844 Accounts payable 71,281 86,671 Billings in excess of costs and estimated earnings 17,290 20,300 Accrued federal and foreign income taxes 8,735 5,020 Other accrued expenses 28,894 28,145 Deferred income taxes 248 248 Due to joint ventures 212 730 Total current liabilities 129,666 141,958 Non-current liabilities Long-term debt, less current portion 1,663 1,917 Deferred income taxes 88 88 Postretirement healthcare and postemployment benefit obligations 7,423 7,423 Total liabilities 138,840 151,386 Stockholders' Equity Preferred stock, par value $0.01; 2,000,000 shares authorized; none issued or outstanding Common stock, par value $0.01; 20,000,000 shares authorized; 8,974,467 outstanding at June 30, 1996 and 8,951,154 at December 31, 1995 1,895 1,895 Paid-in capital 13,107 13,085 Accumulated translation adjustment (4,403) (4,446) Unearned compensation - (400) Additional pension liability (344) (344) Retained earnings 74,769 73,668 Total stockholders' equity 85,024 83,458 Total liabilities and stockholders' equity $223,864 $234,844 See accompanying notes Page 2 Guy F. Atkinson Company of California Consolidated Statements of Income (unaudited) (in thousands of dollars except share and per share amounts) Quarter Ended Six Months Ended June 30, June 30, 1996 1995 1996 1995 Revenue $128,714 $86,434 $227,899 $176,172 Cost of revenue 115,787 79,170 206,347 161,970 Gross margin 12,927 7,264 21,552 14,202 General and administrative expenses 10,113 8,882 19,991 17,687 Income (loss) from operations 2,814 (1,618) 1,561 (3,485) Other income (expense) Interest income 703 1,040 1,557 2,086 Interest expense (152) (57) (309) (258) Miscellaneous (375) 1,046 247 1,130 Total other income (expense) 176 2,029 1,495 2,958 Income (loss) before income taxes 2,990 411 3,056 (527) Provision for income taxes 1,406 (310) 1,955 (261) Net income (loss) $1,584 $721 $1,101 ($266) Net income (loss) per share $0.17 $0.08 $0.12 ($0.03) Average number of shares and common stock equivalents utilized in net income (loss) per share calculation 9,403,000 9,033,000 9,328,000 8,917,000 See accompanying notes Page 3 Guy F. Atkinson Company of California Consolidated Statements of Cash Flows (unaudited) (in thousands of dollars except share and per share amounts) Six Months Ended June 30, 1996 1995 Operating activities Net income (loss) $1,101 ($266) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization 5,974 1,242 Deferred income taxes - 7 (Gain) on dispositions of property, plant and equipment (2,759) (2,821) Changes in operating assets and liabilities: Accounts receivable (36,664) (10,084) Inventories and unamortized costs on contracts (5,080) 865 Investments in joint ventures (5,354) 2,918 Other current assets (1,117) (505) Accounts payable and accrued expenses (14,646) 9,010 Accrued income taxes 3,715 (2,682) Billings in excess of costs and estimated earnings, net 18,044 20,002 Other, net 56 55 Net cash provided by (used in) operating activities (36,730) 17,741 Cash flows from investing activities: Property, plant and equipment expenditures (6,637) (10,470) Proceeds from dispositions of property, plant and equipment 5,160 6,651 (Decrease) in other assets, net (1) (1,269) Net cash (used in) investing activities (1,478) (5,088) Cash flows from financing activities: Short-term borrowings 2,200 - Long-term debt repayments (293) (412) Common stock issuance related to stock option awards 422 - Cash dividends paid - (17,835) Net cash provided by (used in) financing activities 2,329 (18,247) Effect of exchange rate changes on cash (16) 463 Net (decrease) in cash and short-term investments ($35,895) ($5,131) Supplementary information: Cash paid (received) during the year for: Interest $300 $293 Federal, foreign and state income taxes (2,258) 3,857 See accompanying notes Page 4 Guy F. Atkinson Company of California Notes to Consolidated Financial Statements (in thousands of dollars except share and per share amounts) Financial Statement Content The information contained herein reflects all adjustments which are, in the opinion of management, necessary for a fair presentation of results for the interim periods. Inventories and Unamortized Costs on Contracts June 30, December 31, Inventory classifications are as follows: 1996 1995 (unaudited) Construction materials and supplies $1,830 $2,812 Unamortized costs on contracts 24,238 18,175 $26,068 $20,987 Stock Options and Warrants At June 30, 1996, the company had options outstanding with respect to 935,658 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. Earnings Per Share Net primary earnings per share of common and common stock equivalents are calculated using the weighted average number of common shares outstanding, 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. Page 5 Guy F. Atkinson Company of California Notes to Consolidated Financial Statements (in thousands of dollars except share and per share amounts) Litigation and Contingencies 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. Page 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Page 7 Results of Operations Quarter ended June 30, 1996 vs. Quarter ended June 30, 1995 (in thousands of dollars except share and per share amounts) Revenue: The company's revenue of $128,714 in the second quarter of 1996 increased by 49% over the corresponding $86,434 in the second quarter of 1995. The increase in revenue was attributable to the substantial volume of new contract awards in 1995 that is making a significant contribution to revenue in 1996. The backlog of uncompleted contracts amounted to $540,115 at June 30, 1996, representing an increase of 9% over the June 30, 1995 backlog of $495,346. Gross margin: The company's gross margin of $12,927 increased by 78% in the second quarter of 1996 over the corresponding $7,264 in 1995. The increase in gross margin was attributable to both the increased volume of revenue as well as a more profitable mix of construction contracts in 1996. The percentage of gross margin to revenue increased to 10.0% in 1996 from 8.4% in 1995. General and administrative expense: General and administrative expenses of $10,113 in 1996 were 14% higher than the corresponding figure of $8,882 in 1995 due to ongoing business development activities in construction, water and wastewater treatment and increased international market development. Page 8 Results of Operations (continued) Quarter ended June 30, 1996 vs. Quarter ended June 30, 1995 Interest income: Interest income decreased to $703 in 1996 from $1,040 in 1995 due to the reduced level of cash and short-term investment balances in 1996, offset in part, by interest earned on a deferred receivable as discussed in "Liquidity and Capital Resources." Interest expense: Interest expense increased to $152 in the second quarter of 1996 from $57 in 1995. The increase was due to the increased level of borrowings in 1996 compared with 1995. Miscellaneous: Miscellaneous expense amounted to $375 in 1996, compared with miscellaneous income of $1,046 in 1995. Miscellaneous income and expense consists of, among other items, gains and losses from foreign exchange and property dispositions. The $1,046 in 1995 included a gain of $1,900 from the disposition of surplus real estate. Income taxes and net income: Income before taxes amounted to $2,990 in 1996, compared with $411 in 1995. Income tax expense was $1,406 in 1996 compared with an income tax benefit of $310 in 1995. The 1996 tax expense was primarily attributable to foreign income taxes on foreign source income, while the 1995 tax benefit was due to the recovery of foreign taxes expensed in earlier years. Net income for the second quarter of 1996 amounted to $1,584, compared with $721 in the second quarter of 1995. Results of Operations (continued) Six months ended June 30, 1996 vs. six months ended June 30, 1995 Revenue: Revenue of $227,899 for the six month period of 1996 increased by 29% over the corresponding $176,172 in 1995, due to the start-up of a number of construction projects in 1995 and 1996 which are making a significant contribution to revenue in 1996. Gross margin: The company's gross margin of $21,552 increased by 52% in the six month period of 1996 over the corresponding figure of $14,202 in 1995 due to a combination of increased revenue and improved operating margins. General and administrative expense: General and administrative expenses of $19,991 in 1996 were 13% higher than the corresponding $17,687 in 1995 due to the increased level of business development activities, and increased development of international market presence as described in the discussion of general and administrative expense for the quarter. Interest income: Interest income decreased to $1,557 in the six month period of 1996 from $2,086 in 1995 due to the reduced level of cash and short- term investment balances in 1996, offset in part, by interest earned on a deferred receivable as outlined in the discussion of "Liquidity and Capital Resources." Interest expense: Interest expense increased to $309 in 1996 from $258 in 1995 due to a slightly higher average level of borrowings in 1996, compared with 1995. Page 9 Results of Operations (continued) Six months ended June 30, 1996 vs. six months ended June 30, 1995 Miscellaneous: Miscellaneous income amounted to $247 in 1996, compared with $1,130 in 1995. The $1,130 in 1995 included a gain of $1,900 from the disposition of surplus real estate. Income taxes and net income: Income before taxes amounted to $3,056 in the six month period of 1996, compared with a loss before taxes of $527 in the corresponding period of 1995. Income taxes gave rise to an expense of $1,955 in 1996 compared with a benefit of $261 in 1995. The 1996 income tax expense was primarily attributable to foreign income taxes on foreign source income, while the 1995 income tax benefit was due to the recovery of foreign taxes expensed in earlier years. Net income for the six month period of 1996 amounted to $1,101, compared with a net loss of $266 in 1995. Liquidity and Capital Resources Operating activities utilized cash of $36,730 in the six month period of 1996, compared with $17,741 of cash generated during the corresponding period of 1995. The utilization of cash by operating activities in 1996 is attributable to the cash requirements for mobilization of new construction projects commencing in the first quarter of 1996, as well as the ongoing cash requirements of existing projects which are expected to Page 10 Results of Operations (continued) Liquidity and Capital Resources return cash to the company in the latter part of 1996. The utilization of cash by operating activities in 1996 is also due to an account receivable of approximately $30,000 upon which the company has agreed to accept deferred payment terms in exchange for certain financing fees and other agreed compensation. This receivable relates to a project to construct the first phase of a continuing care retirement facility. The funds to repay the receivable are generated from the sale of residential units in the facility, and are held in an escrow account to be released and applied towards payment of the receivable at such time as 60% of the residential units have been sold. The construction of this facility is complete, and approximately 51% of the units have been sold to date. Investing activities utilized cash of $1,478 in 1996, compared with $5,088 in 1995 as the company selectively acquired new construction equipment to service its ongoing construction projects. The company's 1996 cash requirements for operations of $36,730 and net capital investments of $1,478 were financed by drawing upon cash and short-term investments amounting to $35,895, and by short-term borrowing of $2,200. The company has a two-year $40 million syndicated line of credit which expires on June 30, 1997. The availability of this line of credit is reduced by any letters of credit which may be outstanding under the lines. At June 30, 1996, the company had $2,200 in outstanding borrowings and $6,773 in outstanding letters of credit. Page 11 Results of Operations (continued) Liquidity and Capital Resources The company believes that its cash and short-term investments, together with lines of credit and funds generated from operations and other sources will be adequate to cover foreseeable future requirements. EX-27 2
5 1000 6-MOS DEC-31-1996 JUN-30-1996 3,312 597 112,867 0 26,068 194,009 55,857 28,356 223,864 129,666 1,663 1,895 0 0 83,129 223,864 0 227,899 0 206,347 19,991 0 309 3,056 1,955 1,101 0 0 0 1,101 0.12 0
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