-----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, FfmNbahw+vre3oxWT4kAE9GRSu6TSF3sxerFwNLLQIQVedItua7vZTHMO4zP5Q4/ bkmOkyiQoXIfx4qiewNnVg== 0000950144-94-001940.txt : 19941215 0000950144-94-001940.hdr.sgml : 19941215 ACCESSION NUMBER: 0000950144-94-001940 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19940930 FILED AS OF DATE: 19941110 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: SCIENTIFIC ATLANTA INC CENTRAL INDEX KEY: 0000087777 STANDARD INDUSTRIAL CLASSIFICATION: 3663 IRS NUMBER: 580612397 STATE OF INCORPORATION: GA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-05517 FILM NUMBER: 94558488 BUSINESS ADDRESS: STREET 1: ONE TECHNOLOGY PKWY SOUTH STREET 2: BOX 105600 CITY: NORCROSS STATE: GA ZIP: 30092 BUSINESS PHONE: 4049035000 FORMER COMPANY: FORMER CONFORMED NAME: SCIENTIFIC ASSOCIATES INC DATE OF NAME CHANGE: 19671024 10-Q 1 SCIENTIFIC ATLANTA FORM 10-Q - 9-30-94 1 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 SEPTEMBER 30, 1994 ---------------------------------------- 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 1-5517 SCIENTIFIC-ATLANTA, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) GEORGIA 58-0612397 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER) ONE TECHNOLOGY PARKWAY, SOUTH NORCROSS, GEORGIA 30092-2967 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) 404-903-5000 (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 --- --- AS OF OCTOBER 28, 1994, SCIENTIFIC-ATLANTA, INC. HAD OUTSTANDING 75,842,057 SHARES OF COMMON STOCK. 1 of 8 2 PART I - FINANCIAL INFORMATION SCIENTIFIC-ATLANTA, INC., AND SUBSIDIARIES CONSOLIDATED STATEMENT OF EARNINGS (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED)
Three Months Ended -------------------------------------- September 30, October 1, 1994 1993 ------------- ----------- SALES $ 232,301 $ 170,292 -------- --------- COSTS AND EXPENSES Cost of sales 162,436 120,700 Sales and administrative 33,148 27,509 Research and development 19,527 12,290 Interest expense 228 252 Interest (income) (886) (841) Other (income) expense, net 40 (133) -------- --------- Total costs and expenses 214,493 159,777 -------- --------- EARNINGS BEFORE INCOME TAXES 17,808 10,515 PROVISION FOR INCOME TAXES Current 6,464 4,152 Deferred (765) (787) ------- -------- NET EARNINGS $ 12,109 $ 7,150 ======== ========= EARNINGS PER COMMON SHARE AND COMMON EQUIVALENT SHARE PRIMARY $ 0.16 $ 0.09 ======== ========= FULLY DILUTED $ 0.16 $ 0.09 ======== ========= WEIGHTED AVERAGE NUMBER OF COMMON SHARES AND COMMON EQUIVALENT SHARES OUTSTANDING PRIMARY 77,910 77,093 ======== ========= FULLY DILUTED 77,978 77,135 ======== ========= DIVIDENDS PER SHARE PAID $ -- $ 0.01 1/2 ======== =========
SEE ACCOMPANYING NOTES 2 of 8 3 SCIENTIFIC-ATLANTA, INC., AND SUBSIDIARIES CONSOLIDATED STATEMENT OF FINANCIAL POSITION
In Thousands ------------------------------------- September 30, July 1, 1994 1994 -------------- -------------- (UNAUDITED) ASSETS CURRENT ASSETS Cash and cash equivalents $ 99,570 $ 123,387 Receivables, less allowance for doubtful accounts of $3,581,000 at September 30 and $3,839,000 at July 1 195,680 206,145 Inventories 171,434 136,813 Deferred income taxes 29,069 27,918 Other current assets 9,850 10,774 ----------- --------- TOTAL CURRENT ASSETS 505,603 505,037 ----------- --------- PROPERTY, PLANT AND EQUIPMENT, at cost Land and improvements 3,850 3,823 Buildings and improvements 29,419 28,890 Machinery and equipment 114,794 108,585 ----------- --------- 148,063 141,298 Less-Accumulated depreciation and amortization 59,618 55,510 ----------- --------- 88,445 85,788 ----------- --------- COST IN EXCESS OF NET ASSETS ACQUIRED 7,501 7,689 ----------- --------- OTHER ASSETS 45,511 41,705 ----------- --------- TOTAL ASSETS $ 647,060 $ 640,219 =========== ========= LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Short-term debt and current maturities of long-term debt $ 8,150 $ 6,487 Accounts payable 90,199 82,285 Accrued liabilities 85,671 95,505 Income taxes currently payable 10,994 17,989 ----------- --------- TOTAL CURRENT LIABILITIES 195,014 202,266 ----------- --------- LONG-TERM DEBT, less current maturities 1,069 1,088 ----------- --------- OTHER LIABILITIES 38,980 41,219 ----------- --------- STOCKHOLDERS' EQUITY Preferred stock, authorized 50,000,000 shares; no shares issued -- -- Common stock, $0.50 par value, authorized 350,000,000 shares; issued 75,783,481 at September 30 and 75,494,670 shares at July 1 37,892 37,747 Additional paid-in capital 145,374 141,179 Retained earnings 227,987 215,926 Accumulated translation adjustments 744 794 ----------- --------- 411,997 395,646 ----------- --------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 647,060 $ 640,219 =========== =========
SEE ACCOMPANYING NOTES 3 of 8 4 SCIENTIFIC-ATLANTA, INC., AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS (IN THOUSANDS) (UNAUDITED)
Three Months Ended ----------------------------------- September 30, October 1, 1994 1993 ------------ --------- NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES: $ (17,340) $ 21,295 --------- -------- INVESTING ACTIVITIES: Purchases of property, plant, and equipment (8,203) (5,957) Other (2,144) (1,163) --------- -------- Net cash used by investing activities (10,347) (7,120) --------- -------- FINANCING ACTIVITIES: Net short-term borrowings 1,663 935 Principal payments on long-term debt (19) (13) Dividends paid -- (1,117) Issuance of common stock 2,226 1,400 --------- -------- Net cash provided by financing activities 3,870 1,205 --------- -------- INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (23,817) 15,380 CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 123,387 103,536 --------- -------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 99,570 $ 118,916 ========= ======== SUPPLEMENTAL CASH FLOW DISCLOSURES Interest paid $ 262 $ 155 ========= ======= Income taxes paid, net $ 12,446 $ 2,516 ========= =======
SEE ACCOMPANYING NOTES 4 of 8 5 NOTES: A. The accompanying consolidated financial statements include the accounts of the company and all subsidiaries after elimination of all material intercompany accounts and transactions. 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 the rules and regulations of the Securities and Exchange Commission. These condensed financial statements should be read in conjunction with the consolidated financial statements and related notes contained in the 1994 Form 10-K. The financial information presented in the accompanying statements reflects all adjustments which are, in the opinion of management, necessary for a fair presentation of the periods indicated. All such adjustments are of a normal recurring nature. B. Earnings per share for the three months ended September 30, 1994, and October 1, 1993 has been computed based on the weighted average number of shares outstanding and equivalent shares derived from dilutive stock options. See Exhibit 11. C. Inventories consist of the following:
September 30, July 1, 1994 1994 -------------- ------------- Raw materials and work-in-process $ 117,421 $ 94,890 Finished goods 54,013 41,923 -------------- ---------- Total inventory $ 171,434 $ 136,813 ============== ==========
D. All per share amounts have been restated to reflect the 2-for-1 stock split effected as a dividend issued on October 6, 1994. 5 of 8 6 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FINANCIAL CONDITION Scientific-Atlanta had stockholders' equity of $412.0 million and cash on hand was $99.6 million at September 30, 1994. Cash decreased $23.8 million during the quarter as expenditures for inventories, equipment and expansion of manufacturing capacity, exceeded cash generated from earnings and accounts receivable collections. The current ratio of 2.6:1 at September 30, 1994, compared to 2.5:1 at July 1, 1994. At September 30, 1994, total debt was $9.2 million or 2 percent of total capital invested. Short-term debt consists of borrowings by the company s international operations to support their working capital requirements. RESULTS OF OPERATIONS Sales for the quarter ended September 30, 1994, were $232.3 million, up 36% from the prior years sales of $170.3 million. Strong growth in sales of transmission and addressable converter products coupled with substantial deliveries of satellite equipment to Orbit Communications Company for its direct to home satellite services contributed to the year-to-year increase in sales, which was partially offset by a decline in sales of instrumentation products. Gross margins were 30.1 percent, up 1.0 percentage point from a year ago. Gains from overall cost improvements and increased volumes in transmission products were offset partially by unfavorable exchange rate changes in Japanese yen and costs associated with capacity expansion. The company believes that gross margins will be negatively impacted in future periods by planned expansion of manufacturing capacity and the continued increase in sales of addressable converter products which have lower margins than some of the company s other products. Continued strength of the yen would also adversely affect gross margins. Certain material purchases are denominated in Japanese yen and, accordingly, the purchase price in U.S. dollars is subject to change based on exchange rate fluctuations. The company has forward exchange contracts to purchase yen to hedge its purchase commitments for a period of approximately two months. Research and development costs were up $7.2 million, or 59 percent, over the prior year due to increased research and development activity, particularly development of digital products. The company anticipates that spending will continue at this level. Selling and administrative expense increased $5.6 million, or 20 percent, from the prior year. Increased expenses reflect costs associated with ongoing investments to support expansion into international markets, the introduction of new products and a build-up in the infrastructure to handle the growth the company is experiencing. Other expense for the quarter ended September 30, 1994, included net losses of $0.5 million from partnership activities and net gains of $0.5 million from royalty income, rental income and other miscellaneous items. Other income of $0.1 million for the quarter ended October 1, 1993, included net losses from partnership activities of $0.2 million and royalty income, rental income and other miscellaneous items of $0.3 million. The company s effective income tax rate was 32 percent for the quarter unchanged from the prior year. Net earnings were $12.1 million, up from $7.2 million in the same quarter a year ago. Higher sales volume and improved margins were the major factors in the year-to-year increase. 6 of 8 7 PART II - OTHER INFORMATION Item 6 Exhibits and Reports on Form 8-K. (a) Exhibits.
EXHIBIT NO. DESCRIPTION ----------- ----------- 11 Computation of Earnings Per Share 27 Financial Data Schedule
(b) No reports on Form 8-K were filed during the quarter ended September 30, 1994 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. SCIENTIFIC-ATLANTA, INC. ------------------------ (Registrant) Date: November 10, 1994 /s/ Harvey A. Wagner ----------------- -------------------- Harvey A. Wagner Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer and duly authorized signatory of the Registrant) 7 of 8 EX-11 2 COMPUTATION OF EARNINGS 1 Exhibit 11 SCIENTIFIC-ATLANTA, INC., AND SUBSIDIARIES COMPUTATION OF EARNINGS PER SHARE (IN THOUSANDS, EXCEPT PER SHARE DATA) EXHIBIT 11 (UNAUDITED)
Three Months Ended ------------------------------------ September 30, October 1, 1994 1993 ------------ --------- WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 75,580 74,494 Add - Additional shares of common stock assumed issued upon exercise of options using the "treasury stock" method as it applies to the computation of primary earnings per share 2,330 2,599 ------------ --------- NUMBER OF COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING 77,910 77,093 Add - Additional shares of common stock assumed issued upon exercise of options using the "treasury stock" method as it applies to the computation of fully diluted earnings per share 68 42 ------------ --------- NUMBER OF SHARES OUTSTANDING ASSUMING FULL DILUTION 77,978 77,135 ============ ========= NET EARNINGS FOR PRIMARY AND FULLY DILUTED COMPUTATION $ 12,109 $ 7,150 ============ ========= EARNINGS PER COMMON SHARE AND COMMON EQUIVALENT SHARE PRIMARY $ 0.16 $ 0.09 ============ ========= FULLY DILUTED $ 0.16 $ 0.09 ============ =========
8 of 8 EX-27 3 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 1994, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 3-MOS JUN-30-1995 JUL-02-1994 SEP-30-1994 99,570 0 199,261 3,581 171,434 505,603 148,063 59,618 647,060 195,014 1,069 37,892 0 0 374,105 647,060 232,301 232,301 162,436 162,436 19,527 (73) 228 17,808 5,699 12,109 0 0 0 12,109 0.16 0.16
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