U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C 20549
FORM 1O-QSB
(Mark One)
_X_ Quarterly report under Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended ____June 30, 1995___
______Transition report under Section 13 or 15(d) of the Exchange Act
For the transition period from ____________ to _________________
Commission File Number ____0-7855___
_____________________UNITED-GUARDIAN INC.______________________
(Exact Name of Small Business Issuer as Specified in Its Charter)
__________Delaware_____________ ____11-1719724___
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
____________230 Marcus Boulevard, Hauppauge, New York 11788__________
(Address of Principal Executive Offices)
____________________________(516) 273-0900______________________________
(Issuer's Telephone Number, Including Area Code)
(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 Exchange Act 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 ________
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required
to be filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court.
Yes _______ No ________
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuers classes of
common equity, as of the latest practicable date
_______________________________4,762,889________________________________
<PAGE>
UNITED-GUARDIAN, INC.
INDEX
Page No.
________
Part I. Financial Information:
Consolidated Statements of Earnings -
Three and Six Months Ended
June 30,1995 and 1994 2
Consolidated Balance Sheets -
June 30, 1995 and
December 31,1994 3-4
Consolidated Statements of Cash Flows -
Six Months Ended
June 30,1995 and 1994 5
Consolidated Notes to Financial Statements 6
Management's Discussion and Analysis of
Financial Condition and Results of
Operations 7-8
Part II. Other Information 9
<PAGE>
PART I. - FINANCIAL INFORMATION
UNITED-GUARDIAN, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30 JUNE 30
<S> <C> <C> <C> <C>
1995 1994 1995 1994
_________ _________ _________ _________
Revenue:
Sales $ 3,572,010 $ 3,217,737 $ 1,885,489 $1,823,767
Fees and retainers 25,000 25,000 25,000 ---
_________ _________ _________ _________
3,597,010 3,242,737 1,910,489 1,823,767
_________ _________ _________ _________
Costs and expenses:
Cost of sales 2,321,635 2,234,029 1,160,992 1,177,019
Operating expenses 921,933 969,384 471,790 483,400
_________ _________ _________ _________
3,243,568 3,203,413 1,632,782 1,660,419
_________ _________ _________ _________
Earnings from operations 353,442 39,324 277,707 163,348
Other income (expense):
Interest income 4,212 3,344 1,833 2,000
Interest expense (57,875) (55,972) (28,615) (27,641
_________ __________ _________ _________
Earnings (loss) before 299,779 (13,304) 250,925 137,707
Income taxes
Provision for income taxes 113,800 --- 96,300 55,000
_________ __________ _________ _________
Net earnings (loss) $ 185,979 $ (13,304) $ 154,625 $ 82,807
_________ __________ _________ _________
Earnings per common share $ .04 $ ___ $ .03 $ .02
_________ __________ _________ _________
_________ __________ _________ _________
</TABLE>
See notes to financial statements
Page 2
<PAGE>
UNITED-GUARDIAN, INC.
CONSOLIDATED BALANCE SHEETS
JUNE 30, DECEMBER 31,
ASSETS 1995 1994
____________ ____________
(UNAUDITED)
Current assets:
Cash and cash equivalents $ 311,990 $ 477,324
Accounts receivable
(less allowance for doubtful
accounts of $17,796 at
June 30, 1995 and $19,634 at
December 31, 1994) 926,008 926,694
Inventories 2,214,742 2,275,247
Prepaid expenses and other 149,858 207,408
current assets
Deferred income taxes 83,845 83,845
_________ _________
Total current assets 3,686,443 3,970,518
_________ _________
Property, plant and equipment;
Land 69,000 69,000
Factory equipment and fixtures 1,895,629 1,776,439
Building and improvements 1,677,975 1,653,643
Waste disposal plant 133,532 133,532
_________ _________
3,776,136 3,632,614
Less: Accumulated depreciation 2,285,805 2,187,653
_________ _________
1,490,331 1,444,961
Assets under capital leases, net 31,195 39,424
_________ _________
1,521,526 1,484,385
_________ _________
Other assets:
Processes and patents, net 503,402 547,258
Other 90,199 12,471
_________ _________
593,601 559,729
_________ _________
$ 5,801,570 $ 6,014,632
_________ _________
_________ _________
See notes to financial statements.
Page 3
<PAGE>
UNITED-GUARDIAN, INC.
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND JUNE 30, DECEMBER 31,
STOCKHOLDERS' EQUITY 1995 1994
_________ _________
(UNAUDITED)
Current liabilities:
Accounts payable $ 493,985 $ 730,544
Notes payable banks 50,000 150,000
Accrued expense and other 149,192 146,294
Current portion of long term
debt and capital lease
obligations 121,159 126,908
_________ _________
Total current liabilities 814,336 1,153,746
_________ _________
Long-term debt 785,026 842,491
_________ _________
Capital lease obligations 7,219 9,385
_________ _________
Deferred income taxes 54,625 54,625
_________ _________
Stockholders' equity:
Common stock $.10 par value, 476,289 476,289
authorized 10,000,000 shares,
issued and outstanding
4,762,889 shares
Capital in excess of par value 3,089,380 3,089,380
Retained earnings 574,695 388,716
_________ _________
Total stockholders' equity 4,140,364 3,954,385
_________ _________
$ 5,801,570 $ 6,014,632
_________ _________
_________ _________
See notes to financial statements.
Page 4
<PAGE>
UNITED-GUARDIAN, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
SIX MONTHS ENDED
JUNE 30
1995 1994
________ ________
Cash flows provided by operating activities:
Net earnings (loss) $ 185,979 $ (13,304)
Adjustments to reconcile net earnings (loss)
to net cash flows from operations:
Depreciation and amortization 150,237 128,215
(Increase) decrease in assets:
Accounts receivable 686 202,610
Inventories 60,505 174,586
Prepaid expenses and other assets (20,178) (94,320)
Increase (decrease) in liabilities:
Accounts payable (236,559) (107,704)
Accrued expenses and other 2,898 (183,661)
________ ________
Net cash provided by operating activities 143,568 106,422
________ ________
Cash flows from investing activities:
Acquisition of property, plant and equipment (143,522) (107,579)
________ ________
Net cash (used in) investing activities (143,522) (107,579)
________ ________
Cash flows from financing activities:
Decrease notes payable-bank, net (100,000) (170,000)
Principal payments on long-term debt (57,465) (22,500)
Principal payments on capital lease
obligations (7,915) (11,195)
________ ________
Net cash (used in) financing activities (165,380) (203,695)
________ ________
Net (decrease) in cash and cash equivalents (165,334) (204,852)
Cash and cash equivalents at beginning
of period 477,324 736,268
________ ________
Cash and cash equivalents at
end of period $ 311,990 $ 531,416
________ ________
________ ________
See Notes to Financial Statements
Page 5
<PAGE>
UNITED-GUARDIAN, INC.
CONSOLIDATED NOTES TO FINANCIAL STATEMENTS
1. In the opinion of the Company, the accompanying unaudited financial
statements contain all adjustments (consisting of only normal recurring
accruals) necessary to present fairly the financial position as of June 30,
1995 and December 31, 1994 and the results of operations and cash flows for
the three and six months ended June 30, 1995 and 1994. The accounting
policies followed by the Company are set forth in the Company's financial
statements included in the December 31, 1994 Annual Report.
2. The results of operations for the three and six months ended June
30, 1995 and 1994 are not necessarily indicative of the results to be
expected for the full year. Certain prior year amounts have been
reclassified to conform with the current year presentation.
3. For purposes of the Statement of Cash Flows, the Company considers
all highly liquid investments purchased with a maturity of three months or
less to be cash equivalents.
Cash payments for interest were $58,871 and $55,593 for the six
months ended June 30, 1995 and June 30,1994 respectively.
Cash payments for taxes were $76,409 and $174,136 for the six
months ended June 30,1995 and June 30,1994 respectively.
Page 6
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations
_____________________
Gross Revenue from Operations: Revenue increased $354,273 (10.9%) for
the six months ended June 30, 1995 as compared to the comparable period in
1994. The Guardian division had a sales increase of $376,485 (15.9%) while
the Eastern division had a sales decrease of $22,212 (2.6%). The Guardian
sales increase was primarily due to increased sales volume and price increases
on some cosmetic products.
For the three month period ended June 30, 1995, revenue increased
$86,722 (4.8%) over the comparable period in 1994, while sales of the
Eastern division decreased $9,339 (2.3%). The Guardian sales increase was
primarily due to increased sales volume and price increases on some cosmetic
products. Fees and retainers totaling $25,000 were earned in the three month
period ended June 30, 1995 as compared to none for the comparable period in
1994.
Cost of Sales: As a percentage of sales, cost of sales decreased from 69.4%
for the six months ended June 30, 1994 to 65% in the comparable period in
1995. This decrease is mainly due to the absorption of plant fixed costs by
significantly higher revenue in 1995 as compared to 1994, along with
increased margins resulting from the Company's restructuring of some of its
distributor agreements.
Cost of sales, as a percentage of sales, decreased from 64.5% for the three
month period ended June 30, 1994 to 61.6% for the comparable period in
1995. This decrease was mainly due to increased margins resulting from the
Company's restructuring of some of its distributor agreements.
Operating Expenses decreased $47,451 (4.9%) in the six months ended June
30, 1995 when compared to the comparable period in 1994. For the three
months ended June 30, 1995 there was a decrease of $11,610 (2.4%) over the
comparable period in 1994. These decreases were primarily due to decreases
in payroll and payroll related costs.
Interest Expense increased $1,903 (3.4%) in the six months ended June 30,
1995 when compared to the comparable period in 1994 and $974 (3.5%) in the
three month period ended June 30, 1995 over the comparable period in 1994.
These increases were mainly due to the increase in interest rates.
Interest Income increased $868 (26%) in the six months ended June 30, 1995
when compared to the comparable period in 1994. This increase is primarily
due the increase in interest rates. For the three month period ended June
30, 1995 there was a decrease of $167 (8.4%) over the comparable period in
1994. This decrease mainly resulted from the decline in outstanding notes
receivable.
Financial Condition
___________________
Working capital increased from $2,816,772 at December 31, 1994 to
$2,872,107 at June 30, 1995 primarily as a result of cash provided by
operations. The working capital ratio increased from 3.4 to 1 at December
31, 1994 to 4.5 to 1 at June 30, 1995. The Company believes that its
working capital is and will continue to be sufficient to support its
operating requirements.
Page 7
<PAGE>
SIGNATURES
In accordance with 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.
UNITED-GUARDIAN, INC.
(Registrant)
By: Alfred R. Globus
Alfred R. Globus
Chief Executive Officer and
Chief Financial Officer
Date: August 8, 1995
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000101295
<NAME> UNITED-GUARDIAN, INC.
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<CASH> 311,990
<SECURITIES> 0
<RECEIVABLES> 943,804
<ALLOWANCES> 17,796
<INVENTORY> 2,214,742
<CURRENT-ASSETS> 3,686,443
<PP&E> 3,776,136
<DEPRECIATION> 2,285,805
<TOTAL-ASSETS> 5,801,570
<CURRENT-LIABILITIES> 814,336
<BONDS> 785,026
<COMMON> 476,289
0
0
<OTHER-SE> 3,664,075
<TOTAL-LIABILITY-AND-EQUITY> 5,801,570
<SALES> 3,572,010
<TOTAL-REVENUES> 3,579,010
<CGS> 2,321,635
<TOTAL-COSTS> 2,321,635
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 57,875
<INCOME-PRETAX> 299,779
<INCOME-TAX> 113,800
<INCOME-CONTINUING> 185,979
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 185979
<EPS-PRIMARY> .04
<EPS-DILUTED> .04
</TABLE>
