-----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, Jn3IaPiZSwRi4dbX3rX1VXTLU9nfXderYiHZVsHFcPGpxMTtOWkAYbAmpRGWcxBU ejPcjQSUIb87B/lV2m2G9w== 0000088790-03-000014.txt : 20031112 0000088790-03-000014.hdr.sgml : 20031111 20031112084022 ACCESSION NUMBER: 0000088790-03-000014 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20031111 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20031112 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SELAS CORP OF AMERICA CENTRAL INDEX KEY: 0000088790 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL PROCESS FURNACES & OVENS [3567] IRS NUMBER: 231069060 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-05005 FILM NUMBER: 03990683 BUSINESS ADDRESS: STREET 1: 2034 LIMEKILN PK CITY: DRESHER STATE: PA ZIP: 19025 BUSINESS PHONE: 2156466600 MAIL ADDRESS: STREET 1: 2034 LIMEKILN PIKE CITY: DRESHER STATE: PA ZIP: 19025 8-K 1 aa8k111103.txt 8K11-11-2003 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 OR 15(d) of The Securities Exchange Act Of 1934 Date of Report (Date of earliest event reported) November 11, 2003 SELAS CORPORATION OF AMERICA (Exact name of registrant as specified in its charter) Pennsylvania 1-5005 23-1069060 (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 1260 Red Fox Road, Arden Hills, MN 55112 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (651) 636-9770 Not Applicable (Former name or former address, if changed since last report) Item 9. Other Events and Regulation FD Disclosure and Item 12. Results of Operations and Financial Condition On November 11, 2003, Selas Corporation of America announced earnings for the three and nine months ended September 30,2003 and discussed recent developments. A copy of the press release is attached as Exhibit 99.1 and is incorporated herein by reference. SIGNATURE 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. Selas Corporation of America By: /s/ Robert F. Gallagher ------------------------------ Robert F. Gallagher Chief Financial Officer Date: November 12, 2003 Exhibit 99.1 FROM: SELAS CORPORATION OF AMERICA SCA-444 CONTACT: Robert F. Gallagher 651-604-9638 FOR IMMEDIATE RELEASE SELAS CORPORATION OF AMERICA REPORTS THIRD-QUARTER RESULTS Precision Miniature Medical and Electronic Products Business Continues Strong Growth ST. PAUL, Minn. -November 11, 2003 - Selas Corporation of America (AMEX: SLS) today reported results for the third quarter and nine months ended September 30, 2003. For the third quarter, the Company had sales of $11.8 million, up 13 percent from $10.4 million for the 2002 third quarter. The gain was chiefly due to stronger sales in Selas' Precision Miniature Medical and Electronic Products business. The Company's net loss narrowed significantly to $810,000, or $.16 per share, from a net loss of $6,504,000, or $1.27 per share, for the prior-year period. Selas recognized income of $907,000, or $.18 per share, from discontinued operations for the third quarter, compared with a loss from discontinued operations in the year-earlier period of $5,935,000, or $1.16 per share. Third-quarter 2003 discontinued operations include a gain of $1,247,000, or $.24 per share, from the sale of the Company's wholly owned subsidiary, Deuer Manufacturing. This was partially offset by a net charge of $340,000, or $.06 per share, due to the insolvency filing by Selas SAS, the Company's French Heat Technology subsidiary. For the third quarter, the Company recorded a loss of $1,716,000, or $.34 per share, from continuing operations, which includes a deferred tax asset valuation reserve of approximately $1,215,000, or $.24 per share. This compares to a net loss of $568,000, or $.11 per share, in the year-ago period. For the nine-month period, the Company reported sales of $34.6 million, versus $33.5 million for the year-earlier nine months. Selas' loss improved to $2,377,000, or $.46 per share, from $16,963,000, or $3.31 per share, for the prior-year period. The year-earlier loss of $16,963,000 included $10,552,000 or $2.06 per share, of goodwill that was written off. Mark S. Gorder, president and chief executive officer of Selas, stated "We are pleased to report a sales increase for the third quarter. Our gross margins rose 32 percent and we narrowed the Company's operating loss considerably. As previously announced, Selas' French Heat Technology business filed for insolvency during the second quarter. This process is moving forward as expected, and while its outcome is unknown, we're working cooperatively with the French courts. Concurrently, we're focusing on areas of our business with stronger growth and future potential." Growth Strategy Gorder reiterated that the Company's long-term strategy is to continue to accelerate growth for its Precision Miniature Medical and Electronic Products business. Management believes that Selas' core competencies position it well to expand its line of medical products to capture significantly more business. For the third quarter, Precision Miniature Medical and Electronic Products sales increased 7 percent to $9.2 million from $8.6 million for the 2002 third quarter. For the nine months ended September 30, 2003, Precision Miniature Medical and Electronic Products sales were also up 7 percent to $27.9 million, from $26.1 million in the comparable 2002 period. Net income rose to $594,000 from $461,000 in the prior year. Results for Selas' Precision Miniature Medical and Electronic Products business continue to be buoyed by Selas' small but growing medical component business that saw year-over-year revenue growth of 52 percent. This gain was primarily due to higher sales of components within third-party medical products to detect air bubbles in IV lines and for safety needles that are part of implanted drug delivery systems. However, income from this segment was more than offset by losses in the Company's Heat Technology segment and by general corporate expenses. Gorder concluded, "Our Precision Miniature Medical and Electronic Products business delivered strong performance again in the third quarter. We're building the Company around these core product lines and divesting our non-core assets. With Selas' expertise in the robotic manufacture of miniature and micro-miniature electronic products, we believe we're well suited to compete in the medical device market and strongly positioned for the future." About Selas Headquartered in St. Paul, Minn., Selas Corporation of America designs, develops, engineers and manufactures microminiaturized medical and electronic products. The company's core business segment, Precision Miniature Medical and Electronic Products, supplies microminiaturized components, systems and molded plastic parts, primarily to the hearing instrument manufacturing industry, as well as the computer, electronics, telecommunications and medical equipment industries. Through its core competencies and robotic manufacturing expertise, Selas believes it is well-positioned to compete in the hearing health market and a medical device market that increasingly demands products with increased miniaturization, better cost containment, more reliability and high customer satisfaction. The Company has facilities throughout the United States, Asia and Europe. Selas' common stock is traded on the American Stock Exchange under the symbol "SLS." Forward-Looking Statements Statements as to the company's long-term strategy and other statements herein that are not historical facts or that include forward-looking terminology such as "may", "will", "believe", "expect", "optimistic" or "continue" or the negative thereof or other variations thereon are "forward-looking statements" within the meaning of the Securities Exchange Act of 1934 as amended. These forward-looking statements are affected by known and unknown risks, uncertainties and other factors that may cause Selas' actual results, performance or achievements to differ materially from the results, performance and achievements expressed or implied in the forward-looking statements. These risks, uncertainties and factors include the risk that the Company may not be able to achieve its long-term strategy, risks arising in connection with the insolvency of Selas SAS, competition by competitors with more resources than the Company, foreign currency risks arising from the Company's foreign operations, the cyclical nature of the market for large custom engineered contracts, weakening demand for products of the Company's other business segments due to general economic conditions, possible non- performance of developing technological products and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the year ended December 31, 2002. The Company disclaims any intent or obligation to publicly update or revise any forward-looking statements, regardless of whether new information becomes available, future developments occur or otherwise. Selas Corporation of America Consolidated Statements of Operations (Unaudited) Three Months Ended September 30 September 30, 2003 2002 Sales, net $11,754,452 $10,356,927 Cost of sales 8,723,953 8,055,843 Gross margin 3,030,499 2,301,084 Selling, general and administrative expenses 3,355,020 2,999,530 Operating loss (324,521) (698,446) Interest expense (128,370) (185,940) Interest income 4,801 8,868 Other income (expense), net (46,647) 9,804 Loss from continuing operations before income taxes (494,737) (865,714) Income tax expense (benefit) 1,221,978 (297,336) Loss from continuing operations (1,716,715) (568,378) Income (loss) from discontinued operations, net of Income tax expense (benefit) 906,767 (5,935,268) Net Loss $(809,948) $(6,503,646) Income (loss) per share Basic Continuing operations $ (.34) $( .11) Discontinued operations .18 (1.16) $ (.16) $ (1.27) Diluted Continuing operations $ (.34) .11) Discontinued operations .18 (1.16) $ (.16) $ (1.27) Selas Corporation of America Consolidated Statements of Operations (Unaudited) Nine Months Ended September,30 September,30 2003 2002 Sales, net $34,576,834 $33,544,367 Cost of sales 25,247,839 25,397,410 Gross margin 9,328,995 8,146,957 Selling, general and administrative expenses 9,881,783 9,134,277 Operating loss (552,788) (987,320) Interest expense (444,927) (525,629) Interest income 12,778 29,329 Other income, net 115,034 72,869 Loss from continuing operations before income taxes (869,903) (1,410,751) Income tax expense (benefit) 1,131,004 (488,674) Loss from continuing operations (2,000,907) (922,077) Loss from discontinued operations, net of income tax benefit (376,482) (5,488,752) Net loss before change in (2,377,389) (6,410,829) accounting principle Cumulative effect of change in accounting principle (10,551,926) Net Loss $(2,377,389) $(16,962,755) Loss per share Basic Continuing operations $ (.39) $ ( .18) Discontinued operations (.07) (1.07) Accounting principle change (2.06) $ (.46) $ (3.31) Diluted Continuing operations $(.39) $( .18) Discontinued operations (.07) (1.07) Accounting principle change (2.06) $ (.46) $ (3.31) Selas Corporation of America Consolidated Balance Sheets (Unaudited) September 30, December 31, 2003 2002 Current assets Cash, including cash equivalents of $423,000 in 2003, and $418,000 in 2002, $ 438,910 $ 1,319,207 all cash equivalents are restricted. Accounts receivable (less allowance for doubtful accounts of $592,000 in 2003, and 7,589,646 6,996,896 $434,000 in 2002) Inventories 9,130,356 8,783,153 Refundable income tax 669,275 344,633 Deferred income taxes 854,964 1,591,160 Asset held for sale 540,175 540,175 Other current assets 711,311 726,729 Assets of discontinued operations -- 25,140,325 Total current assets 19,934,637 45,442,278 Property, plant and equipment Land 170,500 170,500 Buildings 1,614,518 1,614,518 Machinery and equipment 28,277,037 27,726,773 30,062,055 29,511,791 Less: Accumulated depreciation 20,158,800 18,684,119 Net property, plant and equipment 9,903,255 10,827,672 Goodwill 5,376,317 5,376,317 Deferred income taxes -- 466,164 Other assets, less amortization 1,820,563 1,568,291 $37,034,772 $63,680,722 Liabilities and Shareholders' Equity September,30 December 31, Current liabilities 2003 2002 (Unaudited) (Audited) Notes payable $4,935,048 $10,920,984 Current maturities of long-term debt 2,150,049 1,573,716 Accounts payable 3,577,727 4,094,908 Customers' advance payments on contracts 863,680 907,811 Guarantee obligations and estimated costs of service 498,300 544,735 Accrued salaries, wages and commissions 1,924,762 1,289,120 Other accrued liabilities 3,848,022 2,668,869 Liabilities of discontinued operations -- 18,757,587 Total current liabilities 17,797,588 40,757,730 Long-term debt -- 2,736,236 Other postretirement benefit obligations 3,603,870 3,571,017 Deferred income taxes 127,746 --- Contingencies and commitments Shareholders' equity Common shares, $1 par; 10,000,000 shares authorized; 5,634,968 shares issued 5,634,968 5,634,968 Additional paid-in capital 12,012,541 12,012,541 Retained earnings (accumulated deficit) (634,133) 1,743,256 Accumulated other comprehensive loss (242,730) (1,509,948) Less: 515,754 common shares held in treasury, at cost (1,265,078) (1,265,078) Total shareholders' equity 15,505,568 16,615,739 $37,034,772 $63,680,722 # # # -----END PRIVACY-ENHANCED MESSAGE-----