-----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, KI2CdEGPfLOjFNkfSG6VmsBhOseOwier34rvL4/WHBxj8puiYADPORFqMgZITW5V c23vAF6E5AYLpZj1PQ0aYA== 0001047469-98-040142.txt : 19981113 0001047469-98-040142.hdr.sgml : 19981113 ACCESSION NUMBER: 0001047469-98-040142 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19980930 FILED AS OF DATE: 19981112 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FANTOM TECHNOLOGIES INC CENTRAL INDEX KEY: 0000864300 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC HOUSEWARES & FANS [3634] IRS NUMBER: 980103552 FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 6-K SEC ACT: SEC FILE NUMBER: 000-26308 FILM NUMBER: 98744223 BUSINESS ADDRESS: STREET 1: 1110 HANSLER RD STREET 2: P O BOX 1004 CITY: WELLAND ONTARIO CANA STATE: A6 BUSINESS PHONE: 3016587581 MAIL ADDRESS: STREET 1: 1110 HANSLER ROAD, PO BOX 1004 STREET 2: WELLAND CITY: ONTARIO FORMER COMPANY: FORMER CONFORMED NAME: IONA APPLIANCES INC DATE OF NAME CHANGE: 19950710 6-K 1 6-K [PICTURE] FIRST QUARTER REPORT TO SHAREHOLDERS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1998 [LOGO] To our shareholders FANTOM TECHNOLOGIES INC . We are very pleased to report record results for the July - September, 1998 period (Q1 fiscal 1999), the third successive quarter in which we have set a record. Net Income for the quarter rose 88% to $3.3 million or $0.36 per share (based on 8,972,809 shares outstanding), compared with $1.7 million or $0.21 per share (based on 8,393,441 shares outstanding) for the year-earlier period. Sales during the quarter increased 84% to $55.1 million. Shipments of the FANTOM-Registered Trademark- LIGHTNING-Registered Trademark- canister, launched in late November 1997, contributed significantly to the large year- over-year gain. In addition, sales of upright vacuums were strong, due in part to a number of changes made to the FANTOM-Registered Trademark- FURY-Registered Trademark- and FANTOM-Registered Trademark- THUNDER-Registered Trademark- models. We restyled both products cosmetically, introduced improved packaging graphics, upgraded the FANTOM-Registered Trademark- FURY-Registered Trademark- vacuum from 10 amps to 12 amps, and commenced airing new short-form advertising for the FURY-Registered Trademark- product. Both uprights also enjoyed the benefits of sharper retail pricing. The Company's next dual-cyclonic entry, the FANTOM-Registered Trademark- CYCLONE XT-TM- upright, is scheduled for introduction early in calendar 1999. This premium machine operates with two motors, one to rotate the brush, the other to create suction and airflow, thereby improving the vacuum's cleaning performance through specialization of tasks. It has an improved air path, a more ergonomically-positioned carrying handle, a re-designed collection bin, and a new tool compartment at the top of the vacuum. With the CYCLONE XT-TM- introduction, consumers will be able to choose from a range of FANTOM-Registered Trademark- uprights, with different features and at different price points. In August, the Company entered into arrangements with Omachron Technologies, Inc. covering the acquisition and development of a number of technologies for various household appliances and other consumer and commercial products. The principal scientists of Omachron have been working together for almost two decades on a wide range of civilian and non-civilian projects, many of which have direct application to consumer products. Pursuant to these arrangements, we are combining our Company's expertise in product design, manufacturing and marketing with Omachron's broad scientific knowledge for the purpose of developing exciting new products with ground-breaking technologies. We are targeting to launch at least two new product lines within a two-year time-frame. In September, the Company established a new $59 million secured loan facility with a Canadian chartered bank. The new banking facility includes a $15 million operating credit as well as three term credits totaling $44 million for general corporate purposes, capital expenditures, and research and development activities. On behalf of the Board, /s/ Kenneth Kelman /s/ Allan D. Millman Kenneth Kelman Allan D. Millman CHAIRMAN OF THE BOARD PRESIDENT AND CHIEF EXECUTIVE OFFICER OCTOBER 21, 1998 CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS FANTOM TECHNOLOGIESINC.
Three Months Ended September 30 (Unaudited) 1998 1997 Sales $ 55,114,160 $ 30,019,582 Cost of goods sold 36,168,204 18,185,471 - -------------------------------------------------------------------------------- 18,945,956 11,834,111 Expenses: Selling, general and administrative 13,930,832 9,136,719 Finance charges (99,932) (17,268) - -------------------------------------------------------------------------------- 13,830,900 9,119,451 - -------------------------------------------------------------------------------- Income before income taxes 5,115,056 2,714,660 Income taxes: Current 1,279,119 678,000 Deferred 562,881 299,000 - -------------------------------------------------------------------------------- 1,842,000 977,000 - -------------------------------------------------------------------------------- Net income 3,273,056 1,737,660 Retained earnings at beginning of period 18,015,632 7,698,105 Dividends (270,093) - Retained earnings at end of period $ 21,018,595 $ 9,435,765 - -------------------------------------------------------------------------------- Net income per share (Basic):* $ 0.36 $ 0.21 - --------------------------------------------------------------------------------
*Net income per share has been calculated using the weighted average number of common and series 1, class A preferred shares outstanding during the respective periods. These were 8,972,809 shares for 1998 and 8,393,441 shares for 1997. FINANCIAL INFORMATION IN THIS REPORT IS EXPRESSED IN CANADIAN DOLLARS, UNLESS OTHERWISE NOTED. CONSOLIDATED BALANCE SHEETS FANTOM TECHNOLOGIES INC .
September 30 (Unaudited) 1998 1997 ASSETS Current assets: Cash $ 2,086,587 $ - Trade accounts receivable 40,242,126 18,836,749 Other receivables 1,253,465 1,587,696 Inventories 17,769,684 18,996,713 Prepaid expenses 2,804,150 1,781,833 - -------------------------------------------------------------------------------- 64,156,012 41,202,991 Deferred development costs, net of amortization 1,320,046 - Property, plant and equipment, at cost 28,298,147 18,686,947 Less accumulated depreciation (5,520,072) (3,909,778) - -------------------------------------------------------------------------------- 22,778,075 14,777,169 - -------------------------------------------------------------------------------- $ 88,254,133 $ 55,980,160 - -------------------------------------------------------------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Loan payable $ - $ 1,738,918 Trade accounts payable 27,089,836 11,730,135 Other payables and accruals 9,065,459 4,193,556 Current portion of capital lease obligations 163,353 264,102 - -------------------------------------------------------------------------------- 36,318,648 17,926,711 Capital lease obligations, Less current portions 7,739 169,894 Deferred income taxes 3,072,114 1,725,200 Shareholders' equity: Share capital 27,837,037 26,722,590 Retained earnings 21,018,595 9,435,765 - -------------------------------------------------------------------------------- 48,855,632 36,158,355 - -------------------------------------------------------------------------------- $ 88,254,133 $ 55,980,160 - --------------------------------------------------------------------------------
CONSOLIDATED STATE MENTS OF CHANGES IN FNANCIAL POSITION FANTOM TECHNOLOGIES INC .
Three Months Ended September 30 (Unaudited) 1998 1997 CASH PROVIDED BY (USED FOR): Operations: Net income $ 3,273,056 $ 1,737,660 Items not requiring cash: Depreciation 525,171 305,385 Deferred tax provision 562,881 299,000 Amortization of deferred development costs 25,525 - Change in non-cash operating working capital (3,804,610) (6,308,154) - -------------------------------------------------------------------------------- 582,023 (3,966,109) Financing: Payments on capital leases (68,381) (63,596) Issuance of common shares and warrants 839,447 - Dividends paid (270,093) - - -------------------------------------------------------------------------------- 500,973 (63,596) Investments: Additions to property, plant and equipment (2,807,384) (2,407,369) Change in non-cash working capital relating to investments (307,489) - Additions to deferred development costs (491,334) - - -------------------------------------------------------------------------------- (3,606,207) (2,407,369) Decrease in cash position (2,523,211) (6,437,074) Cash position at beginning of period 4,609,798 4,698,156 - -------------------------------------------------------------------------------- Cash position at end of period $ 2,086,587 $ (1,738,918) - --------------------------------------------------------------------------------
Cash position is defined as cash less loan payable. [LOGO] FANTOM TECHNOLOGIES INC . HEAD OFFICE AND CANADIAN MANUFACTURING FACILITY: 1110 Hansler Road, P.O. Box 1004 Welland, Ontario L3B 5S1 Voice: (905) 734-7476 Fax: (905) 734-9955 UNITED STATES MANUFACTURING FACILITY: 102 Corporate Blvd., Carolina Center Business Park West Columbia, South Carolina 29169 Voice: (803 ) 739 -1151 Fax: (803) 939-0730 TORONTO SALES OFFICE: Suite 414, 1 Eva Road, Toronto, Ontario M9C 4Z5 Voice: (416)-622-9740 Fax: (416)-626-0674 TORONTO STOCK EXCHANGE: FTM NASDAQ: FTMTF WEBSITE: www.fantom.com E-MAIL: fantom@fantom.com TRANSFER AGENT & REGISTRAR: CIBC Mellon Trust Company 320 Bay Street, P.O. Box 1, Toronto, Ontario M5H 4A1 FANTOM-Registered Trademark-, FURY-Registered Trademark-, THUNDER-Registered Trademark-, LIGHTNING-Registered Trademark- and CYCLONE XT are trademarks of FANTOM TECHNOLOGIES INC. -----END PRIVACY-ENHANCED MESSAGE-----