================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended September 30, 1996
[ ] 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 0-20743
OPEN PLAN SYSTEMS, INC.
(Exact name of small business issuer as specified in its charter)
Virginia 54-1515256
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
4299 Carolina Avenue, 23222
Building C, Richmond, Virginia (Zip Code)
(Address of principal executive
office)
(804) 228-5600
(Issuer's telephone number)
-------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 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 __.
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practical date:
Common Stock, no par value - 4,472,433 shares as of November 14, 1996.
<PAGE>
OPEN PLAN SYSTEMS, INC.
Contents
PART I. FINANCIAL INFORMATION PAGE
Item 1. Financial Statements
Balance Sheets - September 30, 1996 (unaudited) and
December 31, 1995 1
Statements of Income - Three months and Nine months 2
ended September 30, 1996 and 1995 (unaudited)
Statements of Cash Flows - Nine months 3
ended September 30, 1996 and 1995 (unaudited)
Notes to Financial Statements - September 30, 1996 5
Item 2. Management's Discussion and Analysis of 8
Financial Condition and Results of Operations
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 14
Item 2. Changes in Securities 14
Item 3. Defaults Upon Senior Securities 14
Item 4. Submission of Matters to a Vote of 14
Security Holders
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURES
<PAGE>
OPEN PLAN SYSTEMS, INC.
PART I
FINANCIAL INFORMATION
Item 1: Financial Statements
Balance Sheets
September 30 December 31
1996 1995
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $9,554,080 $ 241,564
Trade accounts receivable, net 3,585,814 3,091,607
Inventories 5,384,895 4,045,144
Prepaids and other 355,764 360,345
Refundable income taxes 85,500 --
Deferred income taxes 34,000 --
-------------------------
Total current assets 19,000,053 7,738,660
Property and equipment, net 2,281,262 753,575
Advances to stockholders -- 377,663
Other 267,230 139,587
-------------------------
Total assets $21,548,545 $9,009,485
=========================
Liabilities and stockholders' equity
Current liabilities:
Notes payable $ 300,000 $ --
Revolving line of credit -- 2,706,000
Trade accounts payable 966,795 733,997
Accrued and other liabilities 323,427 419,266
Customer deposits 373,920 336,634
Current portion of long-term debt and capital
lease obligations 196,655 182,666
-------------------------
Total current liabilities 2,160,797 4,378,563
Deferred income taxes 28,000 --
Long-term debt and capital lease obligations,
less current 150,815 303,733
portion
-------------------------
Total liabilities 2,339,612 4,682,296
Stockholders' equity:
Common stock, no par value:
Authorized shares - 50,000,000
Issued and outstanding shares - 4,384,933 at
September 30, 1996 and 2,429,933 at
December 31, 1995 18,775,109 1,215,299
Additional capital 136,971 --
Retained earnings 296,853 3,111,890
-------------------------
Total stockholders' equity 19,208,933 4,327,189
Total liabilities and stockholders' equity $21,548,545 $9,009,485
=========================
See accompanying notes.
1
<PAGE>
OPEN PLAN SYSTEMS, INC.
Statements of Income (Unaudited)
Three Months ended Nine Months ended
September 30 September 30
1996 1995 1996 1995
--------------------- ----------------------
Net sales $4,401,537$3,382,018 $14,946,370$11,048,067
Cost of sales 3,054,485 2,280,039 9,962,146 7,448,223
--------------------- ---------------------
Gross profit 1,347,052 1,101,979 4,984,224 3,599,844
Operating expenses:
Selling and marketing 730,041 443,993 2,212,525 1,370,501
General and administrative 390,087 262,029 1,005,063 733,329
--------------------- ----------------------
1,120,128 706,022 3,217,588 2,103,830
--------------------- ----------------------
Operating income 226,924 395,957 1,766,636 1,496,014
Other (income) expense:
Interest expense 7,458 32,538 130,555 109,683
Interest income (140,402) (5,009) (187,418) (22,508)
Other, net (3,489) 5,630 (18,440) (3,640)
--------------------- ----------------------
(136,433) 33,159 (75,303) 83,535
--------------------- ----------------------
Income before income taxes 363,357 362,798 1,841,939 1,412,479
Provision for income taxes 147,000 -- 169,000 --
--------------------- ----------------------
Net income $ 216,357 $ 362,798 $1,672,939 $1,412,479
===================== ======================
Earnings per common share $ .05
==========
Weighted average common shares 4,384,933
outstanding
==========
Pro forma income data (Note 5):
Pro forma income before
income taxes $ 362,798 $1,841,939 $1,412,479
----------------------
Pro forma provision for
income taxes 143,000 718,000 559,000
--------- ----------------------
Pro forma net income $ 219,798 $1,123,939 $ 853,479
=========== ======================
Pro forma earnings
per common share $ .08 $ .33 $ .31
=========== ======================
Weighted average common
shares 2,713,435 3,410,803 2,721,101
outstanding =========== ======================
See accompanying notes.
2
<PAGE>
OPEN PLAN SYSTEMS, INC.
Statements of Cash Flows (Unaudited)
Nine Months ended
September 30
1996 1995
-----------------------
Operating activities
Net income $1,672,939 $1,412,479
Adjustments to reconcile net income to net cash
provided by operating activities:
Provision for losses on receivables 15,376 37,053
Depreciation and amortization 170,386 89,280
Losses on disposal of property and equipment -- 1,814
Deferred income taxes (6,000) --
Deferred rent (19,227) (28,251)
Increase in cash surrender value of life
insurance (53,006) (31,986)
Changes in operating assets and liabilities:
Trade accounts receivable (509,583) (546,303)
Inventories (1,339,751) (683,506)
Prepaids and other (72,619) (157,645)
Trade accounts payable 232,798 454,211
Customer deposits 37,286 (240,478)
Accrued and other liabilities (78,241) 137,737
-----------------------
Net cash provided by operating activities 50,358 444,405
Investing activities
Proceeds from sale of property and equipment 63,648 --
Purchases of property and equipment (842,400) (296,913)
Acquisition of equipment from Birum Corporation (417,321) --
Other (73,008) 11,061
-----------------------
Net cash used in investing activities (1,269,081) (285,852)
3
<PAGE>
OPEN PLAN SYSTEMS, INC.
Statements of Cash Flows (Unaudited) (continued)
Nine Months ended
September 30
1996 1995
Financing activities
Advances to stockholders $ (305,652)$ (356,610)
Repayment of advances to stockholders 84,143 200,000
Net (repayments) borrowings on revolving line (2,706,000) 771,000
of credit
Principal payments on notes payable, long-term
debt, (340,929) (42,000)
and capital lease obligations
Proceeds from sale of common stock 17,559,810 --
Purchase of common stock -- (144,902)
Distributions to stockholders (3,760,133) (791,477)
-----------------------
Net cash provided (used) by financing activities 10,531,239 (363,989)
-----------------------
-----------------------
Increase (decrease) in cash and cash equivalents 9,312,516 (205,436)
Cash and cash equivalents at beginning of period 241,564 206,136
=======================
Cash and cash equivalents at end of period $9,554,080 $ 700
=======================
=======================
Supplemental disclosures
Interest paid $ 130,555 $ 109,683
=======================
=======================
Income taxes paid $ 260,500 $ --
=======================
Summary of noncash transactions
Issuance of notes payable for equipment $ 502,000 $ --
=======================
Amounts offset against advances to stockholders:
Distributions to stockholders $ 590,872 $ 156,296
=======================
=======================
Purchase of common stock $ -- $ 12,500
=======================
See accompanying notes.
4
<PAGE>
OPEN PLAN SYSTEMS, INC.
Notes to Financial Statements (Unaudited) (continued)
September 30, 1996
1. Basis of Presentation
The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-QSB of the Securities and Exchange
Commission. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management these financial statements
reflect all adjustments of a normal recurring nature which the Company considers
necessary for a fair presentation. Historically, the Company's business has been
significantly affected by seasonal factors. The Company typically has greater
sales revenue during the first and fourth quarters. The results for the three
month and nine month periods ended September 30, 1996 are not necessarily
indicative of the results that may be achieved for the entire year ending
December 31, 1996 or for any other interim period.
2. Inventories
Inventories are in two main stages of completion and consisted of the following:
September 30 December 31
1996 1995
-------------------------
-------------------------
(Unaudited)
Components and fabric $3,449,122 $2,103,176
-------------------------
Jobs in process and finished goods 1,935,773 1,941,968
-------------------------
=========================
$5,384,895 $4,045,144
=========================
3. Contingencies
The Company guarantees certain bank borrowings of five stockholders aggregating
$205,734 at September 30, 1996. The loans were made to enable the individuals to
purchase shares of the Company's common stock. These loans bear interest at the
prime rate plus 1.50% and are scheduled to be fully paid by April 1999. The
75,000 shares of common stock held by these stockholders serve as collateral for
the loans.
5
<PAGE>
4. Income Taxes
Prior to the Company's initial public offering of common stock in June 1996, the
Company had elected by consent of its stockholders to be taxed under the
provisions of Subchapter S of the Internal Revenue Code. Under these provisions,
the Company did not pay federal and state income taxes on its corporate income.
Instead the Company's income was included in the income of its stockholders for
federal and state income tax purposes. The Company revoked its S-Corporation
election effective June 1, 1996. The undistributed balance of retained earnings
of $136,971 as of June 1, 1996 has been reclassified to additional capital.
5. Pro Forma Information
The accompanying pro forma income data reflects a provision for income taxes as
if the Company's earnings had been subject to federal and state income taxes as
a regular corporation for all periods presented.
Pro forma earnings per common share are based on the weighted average common
shares outstanding for 1996 increased for the average number of shares of common
stock deemed to be outstanding, which represents the approximate number of
common shares deemed sold by the Company at the initial public offering of $10
per share to fund the declared S-Corporation distribution of $2,695,438 which
was paid from the proceeds of the offering.
6. Acquisitions
On October 1, 1996, the Company acquired all of the outstanding common stock of
Immaculate Eagle, Inc. (d/b/a TFM Total Facilities Management) ("TFM") for an
aggregate purchase price of $5,250,000 (excluding transaction costs). TFM is
located in Lansing, Michigan and is a specialized remanufacturer of panel
systems produced by Haworth, Inc. Consideration for the acquisition consisted of
cash of $3,937,500 and 87,500 shares of common stock valued at a price of $15
per share. The 87,500 shares will be held in escrow until October 1, 1998 as
security for indemnification obligations of the former stockholders of TFM.
Under the terms of the purchase agreement, if the closing sales price of the
Company's common stock on October 1, 1998 is less than $15 per share (subject to
certain adjustments), the Company will make a cash payment to the former
stockholders equal to the difference between the closing sales price on that
date and $15, multiplied times the 87,500 shares of common stock. The
acquisition will be accounted for as a purchase and, accordingly, the operations
of TFM will be included in the Company's financial statements from the date of
acquisition.
6
<PAGE>
6. Acquisitions (continued)
On June 17, 1996, the Company purchased certain equipment from Birum
Corporation. Total consideration amounted to approximately $920,000, including
transaction costs. In connection with this purchase, the Company issued
short-term, non-interest bearing notes payable to the seller in the amount of
$502,000. The balance outstanding on these notes at September 30, 1996 was
$300,000 and was fully repaid on October 17, 1996.
7
<PAGE>
OPEN PLAN SYSTEMS, INC.
Item 2: Management's Discussion and Analysis of Financial
Condition and Results of Operations
Overview
Since its inception in 1989, the Company has generated the majority of
revenues from the sale of remanufactured Work Stations and to a lesser extent
from the sale of "as-is" Work Stations and rentals. The Company's sales are
highly dependent upon its network of Company-owned sales offices and sales
personnel because the Company sells approximately 80% of its Work Stations
directly to end-users. Sales from these offices have increased each year as the
Company has added sales personnel, as these personnel have gained experience and
as the Company has achieved greater consumer awareness and name recognition.
Generally, branch sales offices do not generate significant sales in their first
nine months to one year of operation.
The Company sells approximately 20% of its Work Stations through its
dealer network. While the Company prefers to sell directly to the end-user
through its own sales offices, it will continue to use dealers in non-exclusive
relationships, in markets that are too small to support a sales office or in
markets where it does not expect to be able to open a sales office in the near
future. Selling through Company-owned sales offices rather than through dealers
increases the Company's selling costs due to increased overhead and salesperson
compensation expenses. However, the Company believes that these increased costs
are more than offset by the portion of the dealer gross profit margin captured
by the Company. The Company believes that the fifty largest metropolitan areas
in the United States are of sufficient size to support a Company sales office. A
core component of the Company's growth strategy is to increase sales by opening
new sales offices and adding additional sales personnel. In the third quarter of
1996, the Company began manufacturing a line of new workstations to be sold
through the branch sales offices and its dealer network to supplement the
traditional remanufactured product offerings.
Historically, the Company's business has been significantly affected by
seasonal factors. The Company typically has greater sales revenue during the
first and fourth quarters. Since most of the Company's orders are shipped within
three weeks of booking the order, the Company has no significant backlog of
orders and forecasting short-term revenue levels is difficult. The Company uses
temporary employees and other measures to increase production capacity during
periods of higher sales while keeping its baseline operating expenses to a
minimum during periods of lower sales.
8
<PAGE>
Results of Operations
The following table sets forth the relationship of costs and expenses as a
percentage of the Company's sales for the periods indicated:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net Sales...................... 100.0% 100.0% 100.0% 100.0%
Cost of sales.................. 69.4 66.7 67.4 67.4
----- ----- ----- -----
Gross profit................... 30.6 32.6 33.3 32.6
Selling and marketing expernses 16.5 13.2 4.8 12.5
General and administrative
expenses.................... 8.9 7.7 6.7 6.6
----- ----- ----- -----
Operating income ............. 5.2 11.7 11.8 3.5
Other (income) expenses ...... (3.1) 1.0 0.5 0.7
----- ----- ----- -----
Net income before income .....
taxes .................... 8.3 10.7 12.3 2.8
Provision for income taxes ... 3.4 (1.1) 0.0 0.0
Net income ................... 4.9% 12.8% 10.7% 11.2%
===== ===== ===== =====
</TABLE>
Comparison of Three and Nine months Ended September 30, 1996 and
September 30, 1995
Sales. Sales in the three months ended September 30, 1996 were $4,402,000,
an increase of $1,020,000 or 30.3% over the same period in 1995. Sales for the
first nine months of 1996 were $14,946,000, an increase of $3,898,000 or 35.3%
over the same period in 1995. The increases were primarily from increased
same-office sales, and modest sales from three new offices, as well as an
unusually large brokerage sale of $780,000 in April, 1996. The new offices,
located in Chicago, Illinois, New York, New York, and Raleigh, North Carolina
were opened during the fourth quarter 1995, the first quarter 1996, and the
third quarter 1996, respectively, and replaced the two Florida offices which
were closed in 1995. The new offices performed at sales levels typical for new
sales offices in their initial months of operation. The Company believes the
increase in same-office sales is the result of additional market penetration and
an increase in the experience of its sales force. An additional sales office in
the Norfolk, Virginia area was opened in early October, 1996.
Cost of Sales. The Company's cost of sales includes cost of raw materials
(used Work Station components, new fabric, laminate, paint, and other
materials), labor, supplies, freight, utilities, and other manufacturing related
expenses. During the third quarter of 1996, the Company expanded its strategy of
manufacturing component parts that had previously been purchased from third
parties. In September 1996, the Company placed in service equipment purchased
during the second quarter from Birum Corporation and commenced operations of its
metal fabrication facility. This facility manufactures metal component parts
used in the remanufacturing process and in the Company's line of new furniture.
9
<PAGE>
The increase in cost of sales of $774,000 for the third quarter of 1996
and $2,514,000 in the first nine months of 1996 was primarily attributable to
increased sales volume. The gross profit margin decreased during the quarter to
30.6% from 32.6% in the same period last year. The gross margin for the first
nine months of 1996 was 33.3% compared to 32.6% for the same period in 1995. The
decrease in the third quarter was primarily the result of the costs associated
with the establishment of the new metal fabrication facility. The increase for
the first nine months of 1996 was mainly attributable to economies of scale in
purchases of component parts and in cost reductions realized in the Company's
wood fabrication operations that were commenced in the fourth quarter of 1995.
Component and fabric costs increased $278,000 or 23.1% for the quarter,
and $1,225,000 or 31.4% for the first nine months of 1996. As a percentage of
sales, component and fabric costs decreased from 35.6% to 33.7% for the quarter
and from 35.3% to 34.3% in the first nine months. The decreases are due
primarily to cost reductions realized in the wood fabrication facility and to a
lesser extent in the metal fabrication facility.
Remanufacturing costs increased $496,000 or 46.1% for the quarter and
$1,289,000 or 36.4% for the first nine months of 1996. Compensation costs, the
largest single component of remanufacturing costs, increased $167,000 or 35.3%
for the quarter and $640,000 or 45.1% for the first nine months. Compensation as
a percentage of sales increased to 14.6% from 14.0% in the quarter and increased
from 12.7% to 13.7% in the first nine months of 1996. The increases were due
primarily to staffing of the wood and metal fabrication facilities that began
operations in the fourth quarter, 1995 and third quarter, 1996 respectively. The
Company believes that the costs associated with the operation of these
facilities is more than outweighed by the reduction in materials costs which
would otherwise be incurred. Other remanufacturing costs increased $329,000 or
54.7% for the third quarter and $649,000 or 30.3% for the first nine months of
1996 primarily as a result of expenses incurred in establishing the metal
fabrication facility in the third quarter of 1996. As a percentage of sales,
these costs increased to 21.2% from 17.8% for the quarter ended a year earlier,
and decreased to 18.7% from 19.4% for the nine month period ended September 30,
1996.
10
<PAGE>
Selling and Marketing Expenses. The most significant selling and marketing
expenses are salesperson compensation, advertising and other marketing expenses
and rents. The Company compensates its salespeople through a combination of
salaries, commissions and bonuses. While most of these expenses are directly
related to the current year's sales, certain other marketing expenses are
incurred to build name recognition and generate sales leads that may contribute
to sales in later periods.
During the third quarter and first nine months of 1996, the Company
continued to expand its marketing through increased advertising and expansion of
its telemarketing efforts begun in 1995. Salesperson compensation increased
$183,000 or 69.0% during the third quarter and $407,000 or 49.9% during the
first nine months as a result of additional personnel being added to the
salesforce during 1996. Advertising costs increased $36,000 or 48.1% during the
quarter and $171,000 or 82.1% for the first nine months of 1996, as the Company
expanded advertising into the three new markets as well as continued advertising
in existing markets.
General and Administrative Expenses. General and administrative expenses
consist primarily of administrative salaries and related employee benefits, and
legal and accounting fees. Total general and administrative expenses increased
$128,000 or 48.9% for the quarter and $272,000 or 37.1% during the first nine
months of 1996, relating primarily to increased legal and accounting fees and
increased administrative staffing to support increased sales volume.
Other (Income) Expense. The Company has historically operated under a Line
of Credit from Crestar Bank, Richmond, Virginia, that bears interest at the
lesser of the Crestar Bank prime rate or the thirty day LIBOR plus 2.25%. The
Company repaid all outstanding borrowings on the line in June 1996 from the
proceeds of its initial public offering. The Company also has obligations under
long-term notes incurred in connection with the acquisition of manufacturing
equipment. Interest expense decreased $25,000 or 77.1% during the third quarter
of 1996 as a result of the retirement of all interest bearing short-term debt.
Interest expense increased $21,000 for the first nine months of 1996 versus the
prior year period as a result of increased borrowings during the first five
months of the year to support increases in inventories and accounts receivable.
Interest income for the third quarter was $140,000 and $187,000 for the first
nine months of 1996 compared to $5,000 and $23,000 respectively for the same
periods in 1995. The increase was attributable to the investment of cash
proceeds from the Company's initial public offering.
Liquidity and Capital Resources
Historically, the Company's working capital needs have been driven
primarily by the growth associated with its rapidly expanding business. The
Company's primary sources of liquidity have been cash generated from operations
and borrowings under its Line of Credit from Crestar Bank. On May 9, 1996, the
Company increased the maximum amount available under its Line of Credit to
$5,000,000 and extended the expiration date to April 30, 1997. Borrowings on the
Line of Credit bear interest at the lesser of the Crestar Bank prime rate or the
thirty day LIBOR plus 2.25% and are secured by substantially all of the
Company's assets. On June 10, 1996, the Company retired all borrowings on the
Line of Credit with the proceeds from its initial public offering.
11
<PAGE>
Net cash provided by operating activities of $50,000 for the nine months
ended September 30, 1996 was used primarily to fund increased working capital
needs associated with sales growth. Trade accounts receivable and inventories
increased $1,834,000 during the nine months ended September 30, 1996 Trade
accounts receivable increased $494,000 during the nine month period due
primarily to increased sales volume and an increase in the accounts receivable
collection period (the "Collection Period"). The Collection Period, computed by
dividing ending accounts receivable by the average daily sales during the
quarter, rose to 66 days at September 30, 1996 from 58 days at June 30, 1996,
and 64 days at December 31, 1995. Since 1993, the Company's Collection Period
has ranged from a low of 44 days to a high of 73 days, with an average of 56
days. The Company does not anticipate future credit losses to differ materially
from historical percentages which since 1993 have averaged 0.5% of sales.
Inventories for the nine months ended September 30, 1996 increased in line with
the general increase in the Company's business. In addition, since prices of
used furniture vary greatly in the marketplace based on seasonality and source,
the Company generally purchases inventory when prices are favorable rather than
based on target stocking levels. While this methodology may increase carrying
costs somewhat, overall costs are generally reduced.
Net cash used in investing activities was $1,269,000 for the first nine
months of 1996, which was primarily associated with additional investments in
property and equipment. On June 17, 1996, the Company acquired manufacturing
equipment from Birum Corporation, a privately held furniture manufacturer, for
$920,000 (including transaction costs), of which $417,000 was paid in cash in
the second quarter of 1996 from a portion of the proceeds of the Company's
initial public offering. The purchase agreement provided for payments totaling
$202,000 in the third quarter of 1996 and $300,000 in the fourth quarter of
1996, and did not provide for the payment of interest. As of September 30, 1996,
$300,000 remained outstanding under the terms of the agreement which was repaid
on October 17, 1996.
12
<PAGE>
Net cash provided by financing activities was $10,531,000 for the first
nine months of 1996. In the second quarter of 1996 the Company sold 1,955,000
shares of common stock at a price of $10.00 per share. Net proceeds from the
offering (after deducting underwriting discounts and other offering related
expenses) were $17,560,000. Historically, the Company has distributed a portion
of its earnings each year to its shareholders to enable them to pay federal and
state income taxes on their pro rata share of S Corporation income and to
provide them with a return on their investment. The Company distributed
$3,760,000 to shareholders in 1996. The Company revoked its "S Election"
effective June 1, 1996 and will no longer make S Corporation distributions.
As the Company implements its planned expansion, it will require more
funds than it has historically needed. Management believes that the net proceeds
of the initial public offering consummated during the second quarter of 1996
together with cash generated from operations and available borrowings under the
Line of Credit, will provide adequate funds for the Company's anticipated needs,
including working capital and expansion of sales offices and product lines,
until the end of 1997. Management also believes that cash provided from
operations will be sufficient to satisfy all existing debt obligations as they
mature.
Impact of Inflation
Inflation has not had a significant effect on the Company's operations.
13
<PAGE>
OPEN PLAN SYSTEMS, INC.
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
Limitations on Dividends - Under the terms of the Company's revolving
line of credit agreement, the payment of dividends shall not exceed 60%
of the Company's net income.
Item 3. Defaults upon Senior Securities
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
Not Applicable
Item 5. Other Information
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
The registrant has included the following exhibits pursuant to Item 601
of Regulation S-B.
Exhibit No. Description Page No.
----------------------------------------------------------------
11 Schedule Re: Computation of Per Share 10
Earnings
27 Financial Data Schedule (filed 11
electronically only)
(b) Reports on Form 8-K:
On July 2, 1996, the Company filed a Form 8-K related to its acquisition
of certain assets of Birum Corporation.
14
<PAGE>
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
OPEN PLAN SYSTEMS, INC.
-------------------------------------
(Registrant)
Date: November 14, 1996 /s/ Stan A. Fischer
-------------------------------------
Stan A. Fischer
President
Date: November 14, 1996 /s/ Gary M. Farrell
-------------------------------------
Gary M. Farrell
Chief Financial
Officer
15
<PAGE>
OPEN PLAN SYSTEMS, INC.
EXHIBIT INDEX
Exhibit No. Description
-------------------------------------------------------
-------------------------------------------------------
11 Schedule Re: Computation of Per Share
Earnings
27 Financial Data Schedule (filed
electronically only)
16
<PAGE>
OPEN PLAN SYSTEMS, INC.
EXHIBIT 11 - STATEMENT RE:COMPUTATION
OF PER SHARE EARNINGS
Three Months ended Nine Months ended
September 30 September 30
1996 1995 1996 1995
------------------------- ------------------------
Weighted average shares
outstanding during
the period 4,384,933 2,443,891 3,256,356 2,451,557
Average number of shares
assumed outstanding
during the period
approximating the
number of shares sold
(at the initial offering
price of $10) to fund
the final S-Corporation
distribution -- 269,544 154,447 269,544
--------------------------- ------------------------
Total 4,384,933 2,713,435 3,410,803 2,721,101
=========================== ========================
Net income used in
earnings per common
share calculation $ 216,357
==============
Earnings per common
share $ .05
==============
Pro forma net income used in
earnings per common share $ 219,798 $1,123,939 $ 853,479
calculation
============= ========================
Pro forma earnings per
common share $ .08 $ .33 $ .31
============= ========================
17
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET OF OPEN PLAN SYSTEMS, INC. AS OF SEPTEMBER 30, 1996 AND THE RELATED
STATEMENTS OF INCOME AND CASH FLOWS FOR THE NINE MONTHS THEN ENDED AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> Dec-31-1996
<PERIOD-END> Sep-30-1996
<CASH> 9,554,080
<SECURITIES> 0
<RECEIVABLES> 3,661,190
<ALLOWANCES> (75,376)
<INVENTORY> 5,384,895
<CURRENT-ASSETS> 19,000,053
<PP&E> 2,857,740
<DEPRECIATION> (576,478)
<TOTAL-ASSETS> 21,548,545
<CURRENT-LIABILITIES> 2,160,797
<BONDS> 150,815
0
0
<COMMON> 18,775,109
<OTHER-SE> 433,824
<TOTAL-LIABILITY-AND-EQUITY> 21,548,545
<SALES> 14,946,370
<TOTAL-REVENUES> 14,946,370
<CGS> 9,962,146
<TOTAL-COSTS> 9,962,146
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 15,376
<INTEREST-EXPENSE> 130,555
<INCOME-PRETAX> 1,841,939
<INCOME-TAX> 169,000
<INCOME-CONTINUING> 1,672,939
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,672,939
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
