-----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, A58c+moA5kx0BF0pohdVsvdgPyYxcKgILjfyXkwzorwt6LCWTVn/nxBit61TapXP ACmesP1KvzX5BtIyiIGZAQ== /in/edgar/work/20000814/0001092306-00-000113/0001092306-00-000113.txt : 20000921 0001092306-00-000113.hdr.sgml : 20000921 ACCESSION NUMBER: 0001092306-00-000113 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000630 FILED AS OF DATE: 20000814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DHB CAPITAL GROUP INC /DE/ CENTRAL INDEX KEY: 0000899166 STANDARD INDUSTRIAL CLASSIFICATION: [3842 ] IRS NUMBER: 113129361 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-13112 FILM NUMBER: 697247 BUSINESS ADDRESS: STREET 1: 555 WESTBURY AVE CITY: CARLE PLACE STATE: NY ZIP: 11514 BUSINESS PHONE: 5166212552 MAIL ADDRESS: STREET 1: 555 WESTBURY AVE CITY: CARLE PLACE STATE: NY ZIP: 11514 10-Q 1 0001.txt SECOND QUARTER 2000 FORM 10-Q ================================================================================ U.S. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------- FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000 COMMISSION FILE NUMBER: 0-22429 DHB CAPITAL GROUP INC (Exact name of Registrant as specified in its charter) DELAWARE 11-3129361 - ---------------------------- ------------------- (State or other jurisdiction (I.R.S. Employer of incorporation) Identification No.) 555 WESTBURY AVENUE, CARLE PLACE, NEW YORK 11514 (Address of principal executive offices) Registrant's telephone number: (516) 997-1155 Former name, former address and former fiscal year, if changed since last report - -------------------------------------------------------------------------------- Not applicable Indicate by check whether the registrant (1) filed all reports required to be filed by section 13 or 15(d) of the Exchange Act 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, 2000, there were 32,327,390 shares of Common Stock, $.001 par value outstanding. ================================================================================ CONTENTS Page ---- PART I Financial Information --------------------- Item 1. Financial Statements Consolidated Balance Sheet as of June 30, 2000 and December 31, 1999 2 Unaudited Consolidated Statements of Income and Accumulated Deficit For The Three Months Ended June 30, 2000, 1999 and 1998 3 Unaudited Consolidated Statements of Operations and Accumulated Deficit For The Six Months Ended June 30, 2000, 1999 and 1998 4 Unaudited Consolidated Statements of Cash Flows For The Three Months Ended March 31, 2000, 1999 and 1998 5 Unaudited Notes to Consolidated Financial Statements 6 Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition 7-8 PART II Other Information 8 ----------------- Signatures 9
DHB CAPITAL GROUP INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS Unaudited ASSETS June 30, 2000 December 31, 1999 ------ ------------- ----------------- CURRENT ASSETS Cash and cash equivalents $ 700,850 $ 473,441 Accounts receivable, less allowance for doubtful Accounts of $751,150 and $757,741 4,715,981 5,208,365 Inventories 11,406,171 9,045,853 Net assets held for sale - 3,928,980 Prepaid expenses and other current assets 539,570 596,441 ----------- ----------- Total Current Assets 17,362,572 19,253,080 ----------- ----------- PROPERTY AND EQUIPMENT, net 2,357,098 2,252,693 ----------- ----------- OTHER ASSETS Intangible assets, net 6,728 14,353 Investments in non-marketable securities 1,000,000 1,000,000 Deferred tax assets 444,000 444,000 Deposits and other assets 196,726 335,371 ----------- ----------- Total Other Assets 1,647,454 1,793,724 ----------- ----------- TOTAL ASSETS $21,367,124 $23,299,497 =========== =========== LIABILITIES AND STOCKHOLDERS' DEFICIENCY CURRENT LIABILITIES Notes payable-bank $ - $ 5,000,000 Accounts payable 7,775,434 9,495,663 Accrued expenses and other current liabilities 5,333,855 2,557,290 Current maturities of long term debt 85,810 152,815 ----------- ----------- Total Current Liabilities 13,195,099 17,205,768 ----------- ----------- LONG TERM LIABILITIES Long term debt, net of current maturities 43,492 233,582 Note Payable - stockholder 16,046,469 16,046,469 ----------- ----------- Total Long Term Debt 16,089,961 16,280,051 ----------- ----------- Total Liabilities 29,285,060 33,485,819 COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' DEFICIENCY Common stock, $.001 par value, 100,000,000 shares authorized, 32,327,390 and outstanding 32,327 32,332 Additional paid in capital 25,684,453 25,691,774 Subscription receivable - (700,025) Foreign currency translation adjustment (45,614) 12,408 Accumulated deficit (33,589,102) (35,222,811) ----------- ----------- STOCKHOLDERS' DEFICIENCY (7,917,936) (10,186,322) ----------- ----------- TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY $21,367,124 $23,299,497 =========== =========== See accompanying notes to financial statements.
DHB CAPITAL GROUP, INC. AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF INCOME AND ACCUMULATED DEFICIT FOR THE THREE MONTHS ENDED JUNE 30, 2000 1999 1998 ---- ---- ---- Net sales $16,128,373 $8,347,387 $8,045,467 Cost of sales 11,516,371 4,667,251 4,963,208 ----------- ---------- ---------- Gross Profit 4,612,002 3,680,136 3,082,259 Selling, general and administrative expenses 2,814,800 2,605,673 2,411,404 ----------- ---------- ---------- Income before other income (expense) 1,797,202 1,074,463 670,855 ----------- ---------- ---------- Other Expenses (762,998) (323,392) (139,617) ----------- --------- --------- Income from Continuing Operations 1,034,204 751,071 531,238 Discontinued operations Loss from discontinued operations - (612,597) (419,014) ----------- ---------- --------- Income before income taxes 1,034,204 138,474 112,224 Income taxes 22,878 9,410 3,534 ----------- ---------- ---------- Net income 1,011,326 129,064 108,690 Accumulated Deficit Beginning (34,600,428) (3,069,488) (3,715,771) ----------- ---------- ---------- Accumulated Deficit Ending $(33,589,102) $(2,940,424) $(3,607,081) ============ =========== =========== Earnings per common share Continuing Operations Basic shares .032 0.029 0.021 =========== ========== ========== Diluted shares .032 0.025 0.018 =========== ========== ========== Discontinued Operations Basic shares - (0.024) (0.017) =========== ========== ========== Diluted shares - (0.020) (0.014) =========== ========== ========== Weighted shares outstanding Basic shares 32,343,941 25,660,833 24,774,376 Warrants - 4,474,343 4,453,563 ----------- ---------- ---------- Diluted shares 32,343,941 30,135,176 29,227,939 =========== ========== ========== See accompanying notes to financial statements. 3
DHB CAPITAL GROUP, INC. AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND ACCUMULATED DEFICIT FOR THE SIX MONTHS ENDED JUNE 30, 2000 1999 1998 ---- ---- ---- Net sales $29,704,021 $15,717,519 $16,646,148 Cost of sales 21,110,712 9,365,071 10,822,850 ----------- ----------- ----------- Gross Profit 8,593,309 6,352,448 5,823,298 Selling, general and administrative expenses 5,701,489 4,547,191 5,129,913 ----------- ----------- ----------- Income before other income (expense) 2,891,820 1,805,257 693,385 ----------- ----------- ----------- Other Expenses (1,548,032) (645,938) (233,176) ----------- ----------- ----------- Income (Loss) from Continuing Operations 1,343,788 1,159,319 460,209 Discontinued operations Loss from discontinued operations (517,288) (946,468) (825,106) Gain on disposal of discontinued operations 857,860 - - ----------- ----------- ----------- Total income (loss) from discontinued operations 340,572 (946,468) (825,106) Income (loss) before income taxes 1,684,360 212,851 (364,897) Income taxes 50,651 52,377 11,484 ----------- ----------- ----------- Net income (loss) 1,633,709 160,474 (376,381) Accumulated Deficit Beginning (35,222,811) (3,100,898) (3,230,700) ----------- ----------- ----------- Accumulated Deficit Ending (33,589,102) $(2,940,424) $(3,607,081) =========== =========== =========== Earnings (loss) per common share Continuing Operations: Basic shares .042 0.045 0.018 =========== =========== =========== Diluted shares .042 0.039 0.016 =========== =========== =========== Discontinued Operations: Basic shares .011 (0.037) (0.033) =========== =========== =========== Diluted shares .011 (0.032) (0.028) =========== =========== =========== Weighted shares outstanding: Basic shares 32,338,061 25,592,811 24,888,046 Warrants - 4,451,186 4,404,523 ----------- ----------- ----------- Diluted shares 32,338,061 30,043,997 29,292,569 =========== =========== =========== See accompanying notes to financial statements. 4
DHB CAPITAL GROUP, INC. AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30, CASH FLOWS FROM OPERATING ACTIVITIES 2000 1999 1998 ---- ---- ---- Net Income (loss) $ 1,633,709 $ 160,474 $(376,381) Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 210,801 464,191 620,302 Stock issued in settlement of a lawsuit -- 190,000 -- Stock issued for services 32,600 65,156 372,000 Changes in assets and liabilities (Increase) Decrease in: Accounts receivable 492,385 645,422 (800,606) Marketable securities -- 427,242 1,601,698 Inventories (2,360,317) (4,596,204) (2,333,174) Prepaid expenses and other current assets 56,871 (635,193) (977,712) Deferred taxes -- (100,000) (22,118) Deposits and other assets 138,645 (12,667) (101,787) Increase (decrease) in: Accounts payable (1,720,229) 401,879 (566,507) Accrued expenses and other current liabilities 2,776,564 1,403,207 841,270 State income taxes payable -- 10,395 22,286 ----------- ---------- ---------- Net cash provided (used) by operating activities 1,261,029 (1,576,098) (1,720,729) ----------- ---------- ---------- CASH FLOWS FROM INVESTING ACTIVITIES Payments for purchase of assets of subsidiary, net of cash acquired 3,933,980 -- (4,924,073) Payments made for property and equipment (312,581) (331,778) (780,347) ----------- ---------- ---------- Net Cash provided (used) by investing activities 3,621,399 (331,778) (5,704,420) ----------- ---------- ---------- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds (repayments) of note payable- bank (5,000,000) 825,000 2,325,000 Proceeds from shareholder note -- -- 7,100,000 Principal payments on long-term debt (257,095) (53,568) (41,417) Foreign Currency Translation (58,022) (18,505) (6,206) Purchase of treasury stock (31,026) (240,245) (2,770,002) Stock warrant exercised -- 62,500 66,000 Net proceeds from sale of common stock 691,125 1,127,000 -- ----------- ---------- ---------- Net cash provided by financing activities (4,655,018) 1,702,182 6,673,375 NET DECREASE IN CASH AND EQUIVALENTS 227,409 (205,694) (751,774) CASH AND CASH EQUIVALENTS - BEGINNING 473,441 519,117 882,884 ----------- --------- ---------- CASH AND CASH EQUIVALENTS - END $ 700,850 $ 313,423 $131,110 =========== ========== ========== Supplemental cash flow information Cash paid for: Interest $88,272 $154,557 $174,350 Taxes $26,206 $57,468 $ 27,134 See accompanying notes to financial statements. 5
DHB CAPITAL GROUP INC NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED JUNE 30, 2000, 1999 AND 1998 ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS: The consolidated balance sheet at the end of the preceding year has been derived from the audited consolidated balance sheet contained in the Company's form 10-K and is presented for comparative purposes. All other financial statements are unaudited. All unaudited amounts are subject to year-end adjustments and audit, but the Company believes all adjustments, consisting only of normal and recurring adjustments, necessary to present fairly the financial condition, results of operations and changes in cash flows for all interim periods have been made. The results of operations for interim periods are not necessarily indicative of the operating results for the full year. Footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted in accordance with published rules and regulations of the Securities and Exchange Commission. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's form 10-K for the most recent fiscal year. The consolidated financial statements of DHB Capital Group, Inc. and Subsidiaries(the "Company") are unaudited and reflect all adjustments, which are, in the opinion of management, necessary for a fair presentation of the financial position and operating results for the interim period. The consolidated Company includes the following entities: DHB Capital Group Inc., Lanxide Armor Products Inc., Lanxide Electronic Components Inc., NDL Products Inc., Orthopedic Products Inc., Point Blank Body Armor Inc. and Protective Apparel Corporation of America. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. RESULTS OF OPERATIONS THREE MONTHS ENDED JUNE 30, 2000, COMPARED TO THE THREE MONTHS ENDED JUNE 30, 1999. Consolidated net sales increased 93% to $16,128,373 for the three months ended June 30, 2000 as compared to $8,347,387 for the three months ended June 30, 1999 as a result of increased sales volumes in all of the operating companies. Operating income rose to $1,797,202 for the second quarter of 2000 versus $1,074,403 for the second quarter of 1999. Net income was approximately $1,011,000 for the three months ended June 30, 2000 as compared to approximately $129,000 for the three months ended June 30, 1999. THREE MONTHS ENDED JUNE 30, 1999, COMPARED TO THE THREE MONTHS ENDED JUNE 30, 1998 Consolidated net sales were approximately $8,347,387 and $8,045,467 for the three 6 months ended June 30, 1999and 1998, respectively. Gross profit for the three months ended June 30, 1999 increased approximately $598,000 to $3,680,136 over the gross profit for the three months ended June 30, 1998. This is a result of improved operating efficiencies and tighter production controls. Operating income increased 60% to $670,855 for the three months ended June 30, 1999 as compared to operating income of $1,074,463 for the three months ended June 30, 1998. SIX MONTHS ENDED JUNE 30, 2000, COMPARED TO THE SIX MONTHS ENDED JUNE 30, 1999. For the six months ending June 30, 2000 operating income rose approxi- mately $1,086,000 to $2,891,000 from $1,805,000 for the comparable period in the prior year. Net income was approximately $1,634,000 for the six months ended June 30, 000 as compared to $160,000 for the six months ended June 30, 1999. On March 10, 2000 the Company sold its Electronics Division. For the period ended June 30, 2000, the company showed a gain from discontinued operations of $340,572 as compared to a loss of $946,468 for the six months ended June 30, 1999. LIQUIDITY AND CAPITAL RESOURCES The Company's primary capital requirements over the next twelve months are to assist PACA, Point Blank, NDL, and Point Blank International in financing their working capital requirements. Working capital is needed to finance the receivables, manufacturing process and inventory. Working capital at June 30, 2000 was approximately $4.17 million as compared to $19.7 million and $13 million at June 30, 1999 and 1998, respectively. The current ratio at June 30, 2000 improved to 1.31 as of June 30, 2000 as compared to $1.24 as of March 31, 2000 and $1.11 as of December 31, 1999. The Company's cash flow statement showed net cash provided by operating activities for the six months ended June 30, 2000 of $1,261,029 as compared to cash used by operating activities of and ($1,576,098) for the periods ended June 30, 1999. Cash, cash equivalents, and marketable securities totaled $700,850 at June 30, 2000 as compared to $313,423 at June 30, 1999. As of December 31, 1999, the Company had a line of credit with the Bank of New York for $5,000,000 and all of the Company's assets secured the line. On March 10, 2000 the Company repaid the entire line of credit using the proceeds from the sale of the Electronics Group. EFFECT OF INFLATION AND CHANGING PRICES. The Company did not experience significant increases in raw material prices during the six months ended June 30, 2000, 1999 and 1998. The Company believes it will be able to increase prices on their products to meet future price increases in raw materials, should they occur. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS 7 This Annual Report contains certain forward-looking statements and information relating to the Company that is based on the beliefs of the Company's management as well as assumptions made by and information currently available to the Company's management. When used in this document, the words "anticipate," "believe," "estimate", "expect", "going forward", and the similar expressions, as they relate to the Company or Company management, are intended to identify forward-looking statements. Such statements reflect the current views of the Company with respect to future events and are subject to certain risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated or expected. The Company does not intend to update these forward-looking statements. PART II. OTHER INFORMATION ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. On July 21, 2000 the Company held its annual meeting of Security Holders. David Brooks was elected Chairman of the Board, Morton Cohen, Dawn Schlegel and Jerome Krantz were elected to the board. The board elected Mr. David Brooks to be the Chief Executive Officer of the Company. Also voted on at the meeting was to continue the use of Paritz and Company P.A. as the Company's independent auditors. 8 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed by the undersigned, thereunto duly authorized. Dated: August 9, 2000 DHB CAPITAL GROUP INC. By: /s/ DAVID H. BROOKS ------------------- David H. Brooks Chairman of the Board, and Director Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed on behalf of the Registrant and in capacities and at the dates indicated: Signature Capacity Date --------- -------- ---- By: /s/ DAVID H. BROOKS Chairman of the Board August 9, 2000 ------------------- David H. Brooks By: /s/ DAWN SCHLEGEL Chief Financial Officer August 9, 2000 ----------------- Dawn Schlegel 9 EX-27 2 0002.txt FINANCIAL DATA SCHEDULE FOR 2ND QUARTER 2000 10-Q
5 0000899166 DHB Capital Group Inc. 1 U.S. Dollars 6-MOS DEC-31-2000 JAN-31-2000 JUN-30-2000 1.000 700,850 0 4,715,981 747,388 11,406,173 17,362,572 2,357,098 1,969,883 21,367,124 13,195,099 0 0 0 32,327 (7,885,609) 21,367,124 29,704,021 29,704,021 21,110,712 21,110,712 0 0 1,548,032 1,684,360 50,651 1,343,788 340,572 0 0 1,633,709 .042 .042
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