<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>d10q.txt
<DESCRIPTION>FORM 10-Q
<TEXT>
<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the Quarterly Period Ended June 30, 2002
Commission File No. 0-19811
-------
OPTA FOOD INGREDIENTS, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 04-3117634
-------- ----------
(State of Incorporation) (I.R.S. Employer Identification No.)
25 Wiggins Avenue, Bedford, MA 01730
------------------------------ -----
(Address of Principal Executive Offices) (Zip Code)
(781) 276-5100
--------------
(Registrant's Telephone No., 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 August 9, 2002, the registrant had 10,887,577 shares of common stock
outstanding.
<PAGE>
Opta Food Ingredients, Inc.
Form 10-Q
--------------------------------------------------------------------------------
Quarter Ended June 30, 2002
Table of Contents
Page
Number
------
Part I - Financial Information
------------------------------
Item 1 - Financial Statements
Consolidated Balance Sheet
June 30, 2002 and December 31, 2001 3
Consolidated Statement of Operations for the
Three and Six Months Ended June 30, 2002 and 2001 4
Consolidated Statement of Cash Flows for the
Six Months Ended June 30, 2002 and 2001 5
Notes to Consolidated Financial Statements 6
Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
Item 3 - Quantitative and Qualitative Disclosure
About Market Risk 13
Part II - Other Information
---------------------------
Item 1 through Item 6 14
Signatures 16
<PAGE>
Opta Food Ingredients, Inc.
Consolidated Balance Sheet (in thousands)
--------------------------------------------------------------------------------
(Unaudited)
June 30, December 31,
2002 2001
--------- ------------
ASSETS
Current assets:
Cash and cash equivalents $ 4,540 $ 1,579
Short term investments 2,039 4,341
Accounts receivable, net 4,806 3,679
Inventories (Note 3) 6,012 6,124
Prepaid expenses and other current assets 527 164
-------- --------
Total current assets 17,924 15,887
Fixed assets, net 22,049 23,249
Patents and trademarks, net 282 331
Goodwill, net 1,223 1,223
Other assets 666 695
-------- --------
$ 42,144 $ 41,385
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long term debt $ 1,853 $ 333
Accounts payable 1,270 926
Accrued expenses 1,054 963
-------- --------
Total current liabilities 4,177 2,222
Long term debt -- 1,738
Stockholders' equity:
Common stock 113 113
Additional paid-in capital 79,970 79,943
Treasury stock, at cost (1,115) (1,115)
Accumulated other comprehensive loss (45) (107)
Accumulated deficit (40,956) (41,409)
-------- --------
Total stockholders' equity 37,967 37,425
-------- --------
$ 42,144 $ 41,385
======== ========
The accompanying notes are an integral part of the consolidated financial
statements.
3
<PAGE>
Opta Food Ingredients, Inc.
Consolidated Statement of Operations (in thousands, except per share data)
--------------------------------------------------------------------------------
(Unaudited)
<TABLE>
<CAPTION>
For the three months For the six months
ended June 30, ended June 30,
------------------------ --------------------------
2002 2001 2002 2001
----------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
Product revenue $ 7,412 $ 6,982 $ 13,864 $13,304
Cost and expenses:
Cost of revenue 5,472 5,371 10,382 10,449
Selling, general and administrative 1,137 1,363 2,170 2,506
Research and development 417 631 854 1,353
----------- ---------- ----------- -----------
7,026 7,365 13,406 14,308
----------- ---------- ----------- -----------
Income (loss) from operations 386 (383) 458 (1,004)
Other income (expense):
Interest income 33 116 68 261
Interest expense (37) (42) (72) (93)
Other income (expense), net (15) (3) (1) 25
----------- ---------- ----------- -----------
(19) 71 (5) 193
----------- ---------- ----------- -----------
Net income (loss) $ 367 ($ 312) $ 453 ($ 811)
=========== ========== =========== ===========
Basic net income (loss) per share (Note 4) $ .03 ($ .03) $ .04 ($ .08)
=========== ========== =========== ===========
Diluted net income (loss) per share (Note 4) $ .03 ($ .03) $ .04 ($ .08)
=========== ========== =========== ===========
Weighted average shares outstanding - basic 10,857 10,797 10,857 10,792
=========== ========== =========== ===========
Weighted average shares outstanding - diluted 10,905 10,797 10,883 10,792
=========== ========== =========== ===========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
4
<PAGE>
Opta Food Ingredients, Inc.
Consolidated Statement of Cash Flows (in thousands)
--------------------------------------------------------------------------------
(Unaudited)
For the six months ended
June 30,
----------------------
2002 2001
------- --------
Cash flows from operating activities:
Net income (loss) $ 453 ($ 811)
Adjustments to reconcile net income (loss) to cash
provided by (used in) operating activities:
Depreciation and amortization 1,455 1,510
Change in assets and liabilities:
Increase in accounts receivable, net (1,104) (769)
(Increase) decrease in inventories, net 122 (251)
Increase in other current assets (362) (210)
Increase (decrease) in accounts payable 328 (12)
Increase (decrease) in accrued expenses 91 (461)
------- -------
Total adjustments 530 (193)
------- -------
Net cash provided by (used in) operating activities 983 (1,004)
Cash flows from investing activities:
Purchase of short term investments (447) (2,223)
Maturity of short term investments 2,749 2,150
Purchase of fixed assets (151) (2,217)
Increase in patents and trademarks (18) (58)
Decrease in other assets 29 429
------- -------
Net cash provided by (used in) investing activities 2,162 (1,919)
Cash flows from financing activities:
Proceeds from issuance of common stock 27 30
Principal payments on long term debt (218) (255)
------- -------
Net cash used in financing activities (191) (225)
------- -------
Effect of changes in exchange rates on cash 7 (5)
Net increase (decrease) in cash and cash equivalents 2,961 (3,153)
Cash and cash equivalents at beginning of period 1,579 6,807
------- -------
Cash and cash equivalents at end of period $ 4,540 $ 3,654
======= =======
The accompanying notes are an integral part of the consolidated financial
statements.
5
<PAGE>
Opta Food Ingredients, Inc.
Notes to Consolidated Unaudited Financial Statements
--------------------------------------------------------------------------------
1. Basis of Presentation
The consolidated financial statements of Opta Food Ingredients, Inc. (the
"Company") include, in the opinion of management, all adjustments
(consisting of normal and recurring adjustments) necessary for a fair
statement of the Company's financial position at June 30, 2002 and
December 31, 2001 and the results of operations for the three and six
months ended June 30, 2002 and 2001, respectively. All material
intercompany transactions and balances have been eliminated. The results
of operations are not necessarily indicative of results for a full year.
These unaudited interim consolidated financial statements should be read
in conjunction with the audited consolidated financial statements
contained in the Company's Annual Report on Form 10-K for the year ended
December 31, 2001, filed with the Securities and Exchange Commission
pursuant to Section 13 of the Securities Exchange Act of 1934. The
consolidated balance sheet data as of December 31, 2001 was derived from
audited financial statements. Certain information and footnote
disclosures normally included in the financial statements prepared in
accordance with generally accepted accounting principles have been
condensed or omitted pursuant to the Securities and Exchange Commission's
rules and regulations.
2. Recent Accounting Pronouncements
In July 2001, the FASB issued SFAS No. 142, "Goodwill and Other
Intangible Assets". SFAS No. 142 requires that ratable amortization of
goodwill be discontinued and replaced with periodic tests of the
goodwill's impairment and that certain intangible assets other than
goodwill be amortized over their useful lives. The Company adopted the
provisions of SFAS No. 142 on January 1, 2002, and has therefore recorded
goodwill amortization of $41,000 and $82,000 during the three and six
months ended June 30, 2001, which did not recur in 2002. The Company has
completed the transitional impairment test on the unamortized goodwill
balance of $1.2 million as of June 30, 2002, which resulted in no
impairment loss.
In August 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations", which provides the accounting requirements for
retirement obligations associated with tangible long-lived assets. This
Statement requires entities to record the fair value of a liability for
an asset retirement obligation in the period in which it is incurred.
This Statement is effective for our 2003 fiscal year, and early adoption
is permitted. The adoption of SFAS No. 143 is not expected to have a
material impact on our consolidated results of operations, financial
position or cash flows.
In October 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets", which excludes from the
definition of long-lived assets goodwill and other intangibles that are
not amortized in accordance with SFAS No. 142. SFAS No. 144 requires that
long-lived assets to be disposed of by sale be measured at the lower of
carrying amount or fair value less cost to sell, whether reported in
continuing operations or in discontinued operations. SFAS No. 144 also
expands the reporting of discontinued operations to include components of
an entity that have been or will be disposed of rather than limiting such
discontinuance to a segment of a business. The Company adopted SFAS No.
144 on
6
<PAGE>
Opta Food Ingredients, Inc.
Notes to Consolidated Unaudited Financial Statements (Continued)
--------------------------------------------------------------------------------
January 1, 2002 with no material effect on our consolidated results of
operations, financial position or cash flows.
In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB
Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and
Technical Corrections", which provides guidance on the classification of
gains and losses from the extinguishment of debt and on the accounting
for certain specified lease transactions. The adoption of SFAS No. 145 is
not expected to have an impact on our consolidated results of operations,
financial position, or cash flows.
In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs
Associated with Exit or Disposal Activities", which provides guidance on
the recognition and measurement of liabilities associated with disposal
activities. The statement is effective for the Company on January 1,
2003. The Company is currently reviewing the provisions of SFAS No. 146
to determine the standard's impact, if any, upon adoption.
3. Inventories
Inventories consist of the following (in thousands):
June 30, December 31,
2002 2001
----------- ---------
Raw materials $ 954 $ 681
Finished goods 5,058 5,443
----------- ---------
$ 6,012 $ 6,124
=========== =========
Inventories are stated at the lower of cost or market, cost being
determined using the first-in, first-out method.
4. Net Income (Loss) Per Share
Basic net income (loss) per share is determined by dividing the net
income (loss) by the weighted average number of common shares outstanding
during the period. Diluted net income (loss) per share for the three and
six months ended June 30, 2002 is determined by dividing the net income
by the weighted average shares outstanding including common stock
equivalents of 47,672 and 25,738 shares, respectively which represent
employee stock options. For the three and six-months ended June 30, 2001,
common stock equivalents have been excluded from the computation of
dilutive net income (loss) per share because such equivalents are
anti-dilutive.
Options to purchase approximately 1.2 million shares outstanding at June
30, 2002 were not included in the computation of diluted earnings per
share because the options' exercise prices were greater than the average
market price during the period.
7
<PAGE>
Opta Food Ingredients, Inc.
Notes to Condensed Unaudited Financial Statements (Continued)
--------------------------------------------------------------------------------
5. Comprehensive Loss
For the six months ended June 30, 2002, the Company's comprehensive
income was $515,000, which was comprised of the net income of $453,000
and a gain on foreign currency translation adjustment of $62,000, as
compared to a comprehensive net loss of $824,000, which was comprised of
the net loss of $811,000 and a loss on foreign currency translation
adjustment of $13,000 in the same period in 2001.
6. Restructuring
During the fourth quarter of 2001, the Company recorded a charge of
$161,000 for severance and related costs due to a reduction in
headcount as part of a corporate restructuring program. For the six
months ended June 30, 2002, $157,000 of these charges had been paid.
8
<PAGE>
Part I Item 2
Opta Food Ingredients, Inc.
Management's Discussion and Analysis of Financial Condition and
Results of Operations
--------------------------------------------------------------------------------
Introduction:
Opta Food Ingredients, Inc. ("Opta" or the "Company") is a fully integrated
developer, manufacturer and marketer of proprietary food ingredients used by
consumer food companies to improve the nutritional content, healthfulness and
taste of a wide variety of foods. The Company modifies inexpensive raw materials
and produces natural food ingredients that can be considered Generally
Recognized as Safe ("GRAS") under current U.S. Food and Drug Administration
("FDA") regulations.
You should read the following discussion in conjunction with (1) the Company's
accompanying unaudited Consolidated Financial Statements and notes thereto
included in this report on Form 10-Q and (2) the Company's audited Consolidated
Financial Statements, notes thereto and Management's Discussion and Analysis of
Financial Condition and Results of Operations as of and for the year ended
December 31, 2001 included in our Annual Report on Form 10-K for such period.
The following Discussion and Analysis of the Company's Financial Condition and
Results of Operations may contain forward-looking statements that are based on
current expectations, estimates and projections. Such forward-looking statements
reflect management's good-faith evaluation of information currently available.
However, because such statements are based upon, and therefore can be influenced
by, a number of external variables over which management has no, or incomplete,
control, they are not, and should not be read as being guarantees of future
performance or of actual future results; nor will they necessarily prove to be
accurate indications of the times at or by which any such performance or result
will be achieved. Accordingly, actual outcomes and results may differ materially
from those expressed in such forward-looking statements. The Company does not
intend to update any such forward-looking statements. Factors which could cause
actual results to differ from these expectations include sales to a small number
of food and food service companies, the size and timing of significant orders,
as well as deferral of orders, over which the Company has no control; the
extended product testing cycles of the Company's potential customers; the
variation in the Company's sales cycles from customer to customer; increased
competition posed by food ingredient manufacturers; changes in pricing policies
by the Company and its competitors; the adequacy of existing, or the need to
secure or build additional manufacturing capacity in order to meet the demand
for the Company's products; the Company's success in expanding its sales and
marketing programs and its ability to gain increased market acceptance for its
existing product lines; the Company's ability to timely develop and successfully
introduce new products in its pipeline at acceptable costs; the ability to scale
up and successfully produce its products; the potential for significant
quarterly variations in the mix of sales among the Company's products; the gain
or loss of significant customers; shortages in the availability of raw materials
from the Company's suppliers; the impact of new government regulations on food
products; the challenges of integrating the operations of acquired businesses;
and general economic conditions. Factors that could cause or contribute to such
differences include the factors discussed in the section titled "Business" under
the caption "Cautionary Statement Regarding Forward-Looking Statements" as well
as other risk factors as stated in the Company's Annual Report on Form 10-K.
9
<PAGE>
Opta Food Ingredients, Inc.
Management's Discussion and Analysis of Financial Condition and
Results of Operations
--------------------------------------------------------------------------------
Results of operations for the three months ended June 30, 2002 and 2001:
Revenue. Revenue for the three months ended June 30, 2002 was $7.4 million,
representing an increase of $430,000 or 6% in comparison to $7.0 million for the
comparable 2001 quarter. The increase in second quarter revenue was primarily
attributable to increased demand for Canadian Harvest(R) fiber products by major
cereal manufacturers, a major quick-service restaurant customer and the addition
of several new international accounts. In addition, a 5% price increase for
fiber products that went into effect January 1, 2002 contributed to the overall
revenue increase.
Cost of revenue. Cost of revenue for the three months ended June 30, 2002 was
$5.5 million, representing an increase of $101,000 or 2% in comparison to $5.4
million for the comparable 2001 quarter. Cost of revenue as a percentage of
revenue decreased to 74% for the second quarter of 2002 as compared to 77% in
the second quarter of 2001. This decrease was largely the result of lower fiber
manufacturing costs due to efficiencies realized from increased production
volumes during the second quarter of 2002.
Selling, General and Administrative Expenses. Selling, general and
administrative ("SG&A") expenses for the three months ended June 30, 2002 were
$1.1 million, representing a decrease of $226,000 or 17% in comparison to $1.4
million for the comparable 2001 quarter. A majority of the decrease in SG&A
expenses was principally due to decreased marketing and promotional costs as
well as a reduction in amortization expense of approximately $41,000 as a result
of the adoption of SFAS No. 142, "Goodwill and Other Intangible Assets."
Research and Development Expenses. Research and development ("R&D") expenses for
the three months ended June 30, 2002 were $417,000, representing a decrease of
$214,000 or 34% in comparison to $631,000 for the comparable 2001 quarter. A
majority of the decrease in R&D expenses was the result of lower salaries and
related personnel costs attributable to a reduction in headcount based on the
Company's corporate restructuring program.
Other Income (Expense). Other expense for the three months ended June 30, 2002
was $19,000, representing a decrease of $90,000 in comparison to other income of
$71,000 for the comparable 2001 quarter. The decrease was primarily attributable
to a reduction in interest income on lower levels of cash and investments during
the second quarter of 2002 as compared to the 2001 quarter as well as a
reduction in investment yields.
Results of operations for the six months ended June 30, 2002 and 2001:
Revenue. Revenue for the six months ended June 30, 2002 was $13.9 million,
representing an increase of $560,000 or 4% in comparison with $13.3 million for
the first six months of 2001. The increase in revenue was primarily attributable
to increased demand for Canadian Harvest(R) fiber products by major cereal
manufacturers and the addition of several new international accounts during the
first half of 2002 as well as the impact of the price increase related to the
Company's fiber products which went into effect January 1, 2002.
10
<PAGE>
Opta Food Ingredients, Inc.
Management's Discussion and Analysis of Financial Condition and
Results of Operations
--------------------------------------------------------------------------------
Cost of Revenue. Cost of revenue for the six months ended June 30, 2002 was
$10.4 million, representing a decrease of $67,000 or 1% in comparison to $10.4
million for the comparable 2001 period. Cost of revenue as a percentage of
revenue decreased to 75% for the first six months of 2002 as compared to 79% for
the same period in 2001. This decrease was largely the result of lower fiber
manufacturing costs due to efficiencies realized from increased production
volumes during the the first half of 2002.
Selling, General and Administrative Expenses. SG&A expenses for the six months
ended June 30, 2002 were $2.2 million, representing a decrease of $336,000 or
13% in comparison to $2.5 million for the comparable 2001 period. A majority of
the decrease in SG&A expenses was principally due to decreased marketing and
promotional costs as well as a reduction in amortization expense of
approximately $82,000 for the six months ended June 30, 2002 as a result of the
adoption of SFAS No. 142, "Goodwill and Other Intangible Assets." SG&A expenses
as a percentage of revenue decreased to 16% for the first six months of 2002
from 19% for the same period last year.
Research and Development Expenses. R&D expenses for the six months ended June
30, 2002 were $854,000, representing a decrease of $499,000 or 37% in comparison
to $1.4 million for the comparable 2002 period. A majority of the decrease in
R&D expenses was the result of lower salaries and related personnel costs
attributable to a reduction in headcount based on the Company's corporate
restructuring program. R&D expenses as a percentage of revenue decreased to 6%
for the first half of 2002 from 10% for the same period last year.
Other Income (Expense). Other expense for the six months ended June 30, 2002 was
$5,000, representing a decrease of $198,000 in comparison to other income of
$193,000 for the comparable 2001 period. The decrease was primarily attributable
to a reduction in interest income on lower levels of cash and investments during
2002 as compared to the first six months of 2001 as well as a reduction in
investment yields.
Liquidity and Capital Resources:
At June 30, 2002, the Company had $7.1 million in cash and investments and $13.7
million of working capital. For the first six months of 2002, the Company
generated approximately $983,000 of positive cash flow from operations as
compared with the same period in 2001 when the Company used approximately $1.0
million to fund operations.
Capital expenditures were $151,000 and $2.2 million for the six months ended
June 30, 2002 and 2001, respectively. The higher level of capital expenditures
in 2001 is as a result of expanding the Company's Cambridge, Minnesota oat fiber
production facility to meet anticipated future growth. The total cost of the
expansion to date has been approximately $3.7 million which was funded out of
internal funds and the additional production line is anticipated to be
operational in the fourth quarter of 2002.
The Company's mortgage loan relating to its corporate headquarters located in
Bedford, MA has a balloon payment of $1.6 million due in May 2003. This amount
has been included in the current portion of long term debt at June 30, 2002. It
is the Company's intention to refinance the mortgage loan prior to its maturity.
11
<PAGE>
This mortgage loan agreement contains covenants that restrict the Company's
ability to participate in merger discussions, pay dividends, limit annual
capital expenditures, invest in certain types of securities and obtain
additional debt financing without bank approval. The Company was in compliance
with respect to all covenants and restrictions in its loan agreement at June 30,
2002.
The Company believes that its existing cash and cash equivalents, investments,
long and short term debt and product sales will be adequate to fund potential
future losses as well as its planned operations, capital requirements and
expansion needs through the next few years. However, the Company may require
additional capital in the long term, which it may seek through equity or debt
financing, equipment lease financing or funds from other sources. No assurance
can be given that these funds will be available to the Company on acceptable
terms, if at all. In addition, because of the Company's need for funds to
support future operations, it may seek to obtain capital when conditions are
favorable, even if it does not have an immediate need for additional capital at
such time.
Critical Accounting Policies and Estimates
The preparation of the unaudited consolidated financial statements requires the
Company to make estimates and judgments that affect the reported amounts of
assets, liabilities and expenses. On an on-going basis, the Company evaluates
its estimates, including those related to uncollectible accounts receivable,
inventories, goodwill, intangibles and other long-lived assets. The Company
bases its estimates on historical experience and on various other assumptions
that are believed to be reasonable under the circumstances, the results of which
form the basis for making judgments about the carrying values of assets and
liabilities that are not readily apparent from other sources. Actual results may
differ from these estimates under different assumptions or conditions.
The Company believes the following critical accounting policies affect its more
significant judgments and estimates used in the preparation of its unaudited
consolidated financial statements:
o The Company maintains allowances for uncollectible accounts
receivable for estimated losses resulting from the inability of
its customers to make required payments. If the financial
condition of the Company's customers were to deteriorate,
resulting in an impairment of their ability to make payments,
additional allowances may be required.
o The Company maintains allowances for estimated excess or obsolete
inventories based on the Company's review of inventory levels,
projected future sales and comparison of actual manufacturing
costs to standard costs. If actual market conditions are less
favorable than those projected by management, additional
allowances or write-downs may be required.
o Property, plant and equipment, goodwill, patents, trademarks and
other intangible assets owned by the Company are amortized over
their estimated useful lives. Useful lives are based on
management's estimates over the period that such assets will
generate revenue. Intangible assets are reviewed for impairment
whenever events or changes in circumstances indicate that the
carrying value of an asset may not be recoverable. Future adverse
changes in market conditions or poor operating results of
underlying capital investments or intangible assets could result
in losses or an inability to recover the carrying value of such
assets, thereby possibly requiring an impairment charge in the
future.
12
<PAGE>
Part I Item 3
Quantitative and Qualitative Disclosure about Market Risk
---------------------------------------------------------
Market Rate Risk
Market risks relating to the Company's operations result primarily from changes
in interest rates and foreign currency exchange rates. The Company currently
does not use derivative financial instruments for trading or hedging purposes,
and does not consider its exposure in these areas to be material.
Interest Rate Risk
The Company's exposure to market rate risk for changes in interest rates relates
to its cash equivalents and short-term investments. Cash equivalents consist of
money market mutual funds and other high-credit quality short-term investments
with an original maturity of three months or less. A hypothetical 10% increase
in interest rates would not have a material impact on the fair market value of
these instruments due to their short maturities.
Foreign Currency Exchange Rate Risk
The Company conducts a portion of its business outside the United States through
its foreign subsidiary. The Company's foreign subsidiary maintains its
accounting records in its local currency. Consequently, changes in currency
exchange rates may affect the translation of its foreign statement of operations
into U.S. dollars, which may in turn affect the Company's consolidated statement
of operations. Substantially all of the Company's revenue is invoiced and
collected in U.S. dollars. A hypothetical 10% change in foreign currency
exchange rates would not have a material impact on the Company's results.
13
<PAGE>
Opta Food Ingredients, Inc.
Part II - Other Information
--------------------------------------------------------------------------------
Items 1, 2, 3, 5 and 6(b) - Not Applicable.
Item 4 Submission of Matters to a Vote of Security Holders
(a) The Annual Meeting of Stockholders of Opta Food Ingredients,
Inc. was held on Tuesday, May 21, 2002.
(b) The following individuals were elected to the Board of Directors
for a term expiring in 2003:
<TABLE>
<CAPTION>
Shares voted in favor Votes withheld
--------------------- --------------
<S> <C> <C>
William P. Carmichael 10,288,745 67,925
A. S. Clausi 9,867,645 489,025
Harry Fields 9,867,545 489,125
Glynn C. Morris 10,288,745 67,925
Arthur J. McEvily, Ph.D. 10,211,580 145,090
Olivier Suquet 10,288,745 67,925
</TABLE>
There were no broker non-votes.
(c) The stockholders approved the adoption of the Company's Amended
and Restated Employee Stock Purchase Plan, as described in the
Proxy Statement by a vote of 9,763,773 shares for, 576,997 shares
against and 15,900 shares abstaining, with no broker non-votes.
(d) The stockholders approved the appointment of
PricewaterhouseCoopers LLP as the Company's independent
accountants for fiscal year 2002 by a vote of 10,330,820 shares
for, 12,650 shares against and 13,200 shares abstaining, with no
broker non-votes.
14
<PAGE>
Opta Food Ingredients, Inc.
Part II - Other Information
--------------------------------------------------------------------------------
Item 6 (a) Exhibits
(11) Basic and diluted net income (loss) per share computation (in thousands,
except per share data):
<TABLE>
<CAPTION>
For the three months For the six months
ended June 30, ended June 30,
----------------------------------------
2002 2001 2002 2001
------ ------- ------ --------
<S> <C> <C> <C> <C>
Net income (loss) $ 367 ($ 312) $ 453 ($ 811)
====== ======= ====== ========
Weighted average shares outstanding - basic 10,857 10,797 10,857 10,792
====== ======= ====== ========
Weighted average shares outstanding - diluted 10,905 10,797 10,883 10,792
====== ======= ====== ========
Basic net income (loss) per share $ .03 ($ .03) $ .04 ($ .08)
====== ======= ====== ========
Diluted net income (loss) per share $ .03 ($ .03) $ .04 ($ .08)
====== ======= ====== ========
</TABLE>
For the three and six months ended June 30, 2002, diluted net income (loss) per
share is determined by dividing the net income by the weighted average shares
outstanding including common stock equivalents of 47,672 and 25,738 shares,
respectively which represent employee stock options. For the three and
six-months ended June 30, 2001, common stock equivalents have been excluded from
the computation of dilutive net income (loss) per share because such equivalents
are anti-dilutive.
Options to purchase approximately 1.2 million at June 30, 2002 were not included
in the computation of diluted earnings per share because the options' exercise
prices were greater than the average market price during the period.
(99) Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
15
<PAGE>
Opta Food Ingredients, Inc.
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.
Opta Food Ingredients, Inc.
---------------------------
(Registrant)
DATE: August 12, 2002 BY: /s/ Arthur J. McEvily, Ph.D.
-----------------------------------------
Arthur J. McEvily, Ph.D.
President and Chief Executive Officer
(principal executive officer)
DATE: August 12, 2002 BY: /s/ Scott A. Kumf
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Scott A. Kumf
Chief Operating Officer,
Chief Financial Officer and Treasurer
(principal financial and accounting officer)
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