-----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, LNUu3MNwJSlUvhM/eGlTLVuBuwrIVrjyqW4rjHT/ATZmZo3smFNiDe988yZ0HqfK mv2TsXDBk/lkUuFItodL5g== 0000856386-96-000013.txt : 19960425 0000856386-96-000013.hdr.sgml : 19960425 ACCESSION NUMBER: 0000856386-96-000013 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960330 FILED AS OF DATE: 19960424 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: GEHL CO CENTRAL INDEX KEY: 0000856386 STANDARD INDUSTRIAL CLASSIFICATION: FARM MACHINERY & EQUIPMENT [3523] IRS NUMBER: 390300430 STATE OF INCORPORATION: WI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-18110 FILM NUMBER: 96550041 BUSINESS ADDRESS: STREET 1: 143 WATER STREET CITY: WEST BEND STATE: WI ZIP: 53095 BUSINESS PHONE: 4143349461 MAIL ADDRESS: STREET 1: 143 WATER STREET CITY: WEST BEND STATE: WI ZIP: 53095 10-Q 1 10-Q 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 Quarterly Period Ended March 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 0-18110 GEHL COMPANY (Exact name of registrant as specified in its charter) Wisconsin 39-0300430 (State or other jurisdiction of incorporation (I.R.S. Employer or organization) Identification No.) 143 Water Street, West Bend, WI 53095 (Address of principal executive office) (zip code) (414) 334-9461 (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. Class Outstanding at March 30, 1996 Common Stock, $.10 Par Value 6,142,372 GEHL COMPANY FORM 10-Q March 30, 1996 REPORT INDEX Page No. PART I. - FINANCIAL INFORMATION: Condensed Consolidated Statements of Income for the Three-Month Periods Ended March 30, 1996 and April 1, 1995 . . . . . . . . . . . . . . . . . . 3 Condensed Consolidated Balance Sheets at March 30, 1996, December 31, 1995, and April 1, 1995 . . . . . . . 4 Condensed Consolidated Statements of Cash Flows for the Three-Month Periods Ended March 30, 1996 and April 1, 1995 . . . . . . . . . . . . . . . . . . 5 Notes to Condensed Consolidated Financial Statements 6 Management's Discussion and Analysis of Results of Operations and Financial Condition . . . . . . . . 8 PART II. - OTHER INFORMATION: Item 6. Exhibits and Reports on Form 8-K . . . . . 10 SIGNATURES . . . . . . . . . . . . . . . . . . 10 PART I - FINANCIAL INFORMATION GEHL COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per share data; unaudited)
Three Months Ended March 30, April 1, 1996 1995 NET SALES $ 39,165 $ 38,268 Cost of goods sold 28,149 27,588 -------- -------- GROSS PROFIT 11,016 10,680 Selling, general and administrative expenses 8,033 7,622 -------- --------- INCOME FROM OPERATIONS 2,983 3,058 Interest expense (1,041) (1,516) Interest income 409 463 Other expense, net (52) (167) --------- --------- INCOME BEFORE INCOME TAXES 2,299 1,838 Income tax provision 403 25 --------- --------- NET INCOME $ 1,896 $ 1,813 ======== ======= EARNINGS PER SHARE $ .31 $ .29
The accompanying notes are an integral part of the financial statements. GEHL COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands)
March 30, December 31, April 1, 1996 1995 1995 (Unaudited) (Unaudited) ASSETS Cash $ 3,740 $ 3,266 $ 4,107 Accounts receivable-net 71,951 69,087 78,372 Finance contracts receivable-net 7,214 4,817 5,190 Inventories 22,856 23,320 22,898 Prepaid expenses and other assets 1,401 1,676 2,590 --------- --------- --------- Total Current Assets 107,162 102,166 113,157 --------- --------- --------- Property, plant and equipment-net 20,438 20,315 20,036 Finance contracts receivable-net, non- current 4,228 2,899 3,081 Other assets 8,337 8,118 5,643 ---------- -------- --------- TOTAL ASSETS $ 140,165 $ 133,498 $ 141,917 ========== ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY Current portion of long-term debt obligations $ 167 $ 197 $ 179 Accounts payable 14,191 14,083 14,377 Accrued liabilities 16,126 15,281 14,153 --------- --------- --------- Total Current Liabilities 30,484 29,561 28,709 --------- --------- --------- Line of credit facility 42,365 37,848 54,988 Long-term debt obligations 8,785 8,818 8,766 Other long-term liabilities 1,485 1,592 1,306 --------- --------- --------- Total Long-Term Liabilities 52,635 48,258 65,060 --------- --------- --------- Common stock, $.10 par value, 25,000,000 shares authorized, 6,218,765, 6,216,765 and 6,171,189 shares issued, respectively 622 622 617 Preferred stock, $.10 par value, 2,000,000 shares authorized, no shares issued - - - Capital in excess of par 26,586 26,580 26,185 Retained earnings 30,373 28,477 21,346 --------- --------- --------- 57,581 55,679 48,148 Less: Treasury stock (76,393 shares- at March 30, 1996) at cost (535) - - --------- --------- --------- Total Shareholders' Equity 57,046 55,679 48,148 --------- --------- --------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 140,165 $ 133,498 $ 141,917 ========== ========== ==========
The accompanying notes are an integral part of the financial statements. GEHL COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands; unaudited)
Three Months Ended March 30, April 1, 1996 1995 CASH FLOWS FROM OPERATING ACTIVITIES: Net Income $ 1,896 $ 1,813 Adjustments to reconcile net income to net cash (used for) provided by operating activities: Depreciation and amortization 675 718 Increase in finance contracts receivable (8,765) (7,692) Proceeds from sales of finance contracts 5,028 4,889 Cost of sales of finance contracts 11 123 Net changes in remaining working capital items (2,087) (7,311) Other - 50 --------- --------- Net cash (used for) provided by operating activities (3,242) (7,410) --------- --------- CASH FLOWS FROM INVESTING ACTIVITIES: Property, plant and equipment additions, net (760) (234) Other assets 505 155 --------- --------- Net cash (used for) provided by investing activities (255) (79) --------- --------- CASH FLOWS FROM FINANCING ACTIVITIES: Decrease in long-term debt obligations (63) (55) Increase (decrease) in long-term liabilities 46 (28) Proceeds from line of credit facility 4,517 9,109 Treasury stock purchase (535) - Proceeds from issuance of common stock 6 - --------- --------- Net cash provided by financing activities 3,971 9,026 --------- --------- Net increase in cash 474 1,537 Cash, beginning of period 3,266 2,570 --------- --------- Cash, end of period $ 3,740 $ 4,107 =========== =========== Supplemental disclosure of cash flow information: Cash paid for the following: Interest $ 1,007 $ 1,393 Income Taxes $ 299 $ 939
The accompanying notes are an integral part of the financial statements. GEHL COMPANY AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS March 30, 1996 (Unaudited) NOTE 1 - BASIS OF PRESENTATION The condensed consolidated financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although management believes that the disclosures are adequate to make the information presented not misleading. In the opinion of management, the information furnished for the three- month periods ended March 30, 1996 and April 1, 1995 includes all adjustments, consisting only of normal recurring accruals, necessary for a fair presentation of the results of operations and financial position of the Company. The results of operations for the three months ended March 30, 1996 are not necessarily indicative of the results to be expected for the entire year. It is suggested that these interim financial statements be read in conjunction with the financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 1995 as filed with the Securities and Exchange Commission. NOTE 2 - EARNINGS PER SHARE Earnings per share is computed by dividing net income by the weighted average number of common shares outstanding and, if applicable, common stock equivalents which would arise from the exercise of stock options and warrants. The weighted average number of shares used in the computations was 6,203,045 and 6,202,996 for the three months ended March 30, 1996 and April 1, 1995, respectively. NOTE 3 - INCOME TAXES The income tax provision is determined by applying an estimated annual effective income tax rate to income before income taxes. The estimated annual effective income tax rate is based on the most recent annualized forecast of pretax income, permanent book/tax differences, and tax credits. NOTE 4 - INVENTORIES If all of the Company's inventories had been valued on a current cost basis, which approximated FIFO value, estimated inventories by major classification would have been as follows (in thousands): March 30, December 31, April 1, 1996 1995 1995 --------- ------------ --------- Raw materials and supplies $ 3,898 $ 4,151 $ 3,803 Work in process 9,292 9,893 9,830 Finished machines and parts 28,539 28,149 26,122 ------- ------ ------- Total current cost value 41,729 42,193 39,755 Adustment to LIFO basis (18,873) (18,873) (16,857) ------- --------- -------- $22,856 $23,320 $22,898 ======== ========= ========= NOTE 5 - CONTINGENCIES The Company has received notification from the City of West Bend, Wisconsin that it may have some financial responsibility with respect to the closure of a landfill site operated by the City of West Bend from the mid- 1960's through 1984. The amount of the Company's potential financial obligation, if any, is not presently determinable. The City of West Bend is currently taking remedial action with respect to the landfill site. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION Results of Operations Three Months Ended March 30, 1996 Compared to Three Months Ended April 1, 1995 Net sales for the first quarter of 1996 of $39.2 million were $897,000, or 2%, higher than the $38.3 million in the comparable period of 1995. Gehl Construction's net sales increased 22% to $17.1 million in the first quarter of 1996 from $14.0 million in the first quarter of 1995. The Gehl Construction increase resulted from increased demand for the Company's products, particularly rough-terrain telescopic forklifts and skid steer loaders. Gehl Agriculture sales decreased 9% to $22.1 million in the first quarter of 1996 from $24.3 million in the first quarter of 1995. The decrease was due in part to no new product introductions in the first quarter of 1996, contrasted with the 1995 first quarter introduction of two redesigned product lines. The decrease was also due in part to 1995's first quarter containing approximately $1 million of sales of products which have since been discontinued. Gross profit increased $336,000, or 3%, during the first quarter of 1996 versus the comparable period of 1995, due primarily to increased sales volume. Gross profit as a percent of net sales increased slightly to 28.1% for the first quarter of 1996 from 27.9% in the comparable period of 1995. The shift in product mix of sales to Gehl Construction resulted in the overall Company increase in gross profit as a percent of net sales. Gross profit as a percent of net sales for Gehl Construction decreased to 32.0% in the first quarter of 1996 from 32.4% in the first quarter of 1995. Gross profit as a percent of net sales for Gehl Agriculture decreased to 24.4% in the first quarter of 1996 from 25.3% for the first quarter of 1995. The primary reason for the lower Gehl Agriculture percentage was increased unit costs due to lower overhead absorption associated with reduced levels of production. Selling, general and administrative expenses increased $411,000, or 5%, during the first quarter of 1996 versus the comparable period of 1995. As a percent of net sales, selling, general and administrative expenses increased to 20.5% during the first quarter of 1996 versus 19.9% in the comparable period of 1995. Greater investment in research and development and in selling expenses accounted for the percentage increase. Income from operations in the first quarter of 1996 of $3.0 million was 2% lower than the $3.1 million for the first quarter of 1995. Interest expense decreased $475,000, or 31%, to $1.0 million in the first quarter of 1996 from $1.5 million in the first quarter of 1995. The decrease was a result of a reduction in average debt outstanding to $50.0 million in the first quarter of 1996 versus $59.6 million in the first quarter of 1995, combined with a decrease in the average rate of interest paid by the Company to 8.1% in the first quarter of 1996 from 9.8% in the comparable period of 1995. The decrease in the average debt outstanding was primarily the result of cash flow generated from reduced accounts receivable levels and increased shareholders' equity over the past twelve months. The rate decrease was due to the impact of a reduced interest rate structure negotiated by the Company in conjunction with the December 1, 1995 amendment to its line of credit facility. Other expense, net was $52,000 in the first quarter of 1996 versus $167,000 in the first quarter of 1995. The reduction was primarily due to lower costs of selling finance contracts receivable in the first quarter of 1996 versus the comparable period of 1995. The reduction in the costs of such sales was primarily the result of lower yields negotiated by the Company with the third party purchasers. The Company's effective income tax rate was 17.5% for the first quarter of 1996. Under generally accepted accounting principles, the Company was not required to record a federal income tax provision related to its 1995 first quarter operating income due to the existence of net operating loss carryforwards. The Company has now utilized substantially all of its federal net operating loss carryforwards. Financial Condition The Company's working capital was $76.7 million at March 30, 1996, as compared to $72.6 million at December 31, 1995, and $84.4 million at April 1, 1995. The increase since December 31, 1995 resulted primarily from seasonal increases in accounts receivable and finance contracts receivables. The decrease from April 1, 1995 was due primarily to a reduction in accounts receivable. The Company's first quarter 1996 cash flow used for operating activities was $3.2 million versus $7.4 million used for operating activities in comparable 1995. The first quarter cash flow from operating activities is normally negative due to seasonal increases in accounts receivables and inventories. Capital expenditures for property, plant and equipment during the first quarter of 1996 were approximately $760,000. Outstanding commitments as of March 30, 1996 totaled approximately $468,000. The Company plans to make approximately $4.0 million of capital expenditures during 1996. As of March 30, 1996, the weighted average interest rate paid by the Company on outstanding borrowings under its line of credit facility was 7.5%. The Company had available unused borrowing capacity of $28.9 million, $27.4 million and $18.0 million under the line of credit facility at March 30, 1996, December 31, 1995, and April 1, 1995, respectively. At March 30, 1996, December 31, 1995, and April 1, 1995, the borrowings outstanding under the line of credit facility were $42.4 million, $37.8 million and $55.0 million, respectively. The sale of finance contracts is an important component of the Company's overall liquidity. Gehl has arrangements with several financial institutions and financial service companies to sell, with recourse, its finance contracts receivable. The Company continues to service all contracts whether or not sold. At March 30, 1996, Gehl serviced $56.2 million of such contracts, of which $44.2 million were owned by other parties. The Company believes that it has sufficient capacity to sell its retail finance contracts for the foreseeable future. Shareholders' equity at March 30, 1996 was $57.0 million. This was $8.9 million higher than the $48.1 million of shareholders' equity at April 1, 1995, due primarily to income earned from April 2, 1995 through March 30, 1996. PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits 3.1 Amendment to Gehl Company By-laws, dated February 23, 1996 [Incorporated by reference to Exhibit 3.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 1995] 3.2 By-laws of Gehl Company, as amended [Incorporated by reference to Exhibit 3.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 1995] 27 Financial Data Schedule [EDGAR version only] (b) Reports on Form 8-K No reports on Form 8-K were filed by the Company during the quarter ended March 30, 1996. SIGNATURES 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. GEHL COMPANY Date: April 24, 1996 By: /s/ William D. Gehl William D. Gehl President and Chief Executive Officer Date: April 24, 1996 By: /s/ Kenneth F. Kaplan Kenneth F. Kaplan Vice President of Finance and Treasurer (Chief Financial and Accounting Officer) GEHL COMPANY FORM 10-Q March 30, 1996 EXHIBIT INDEX Exhibit Number Document Description 3.1 Amendment to Gehl Company By-laws, dated February 23, 1996 [Incorporated by reference to Exhibit 3.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 1995] 3.2 By-laws of Gehl Company, as amended [Incorporated by reference to Exhibit 3.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 1995] 27 Financial Data Schedule [EDGAR version only] EX-27 2 EXHIBIT 27 GEHL COMPANY
5 This schedule contains summary financial information extracted from Gehl Company's consolidated balance sheet at March 30, 1996 and consolidated statements of income for the three month period ended March 30, 1996 and is qualified in its entirety by reference to such financial statements. 1000 3-MOS DEC-31-1996 JAN-1-1996 MAR-30-1996 3740 0 79165 0 22856 107162 54368 33930 140165 30484 51150 622 0 0 56424 140165 39165 39165 28149 28149 0 0 1041 2299 403 1896 0 0 0 1896 .31 0 Company presents receivables on a net basis in compliance with Article 10 of Regulation S-X. Includes all non-current portion of debt obligations Not reported
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