UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the quarterly period ended April 4, 1998 or
[ ] 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 0-22799
B E I T E C H N O L O G I E S, I N C.
(Exact name of Registrant as specified in its charter)
Delaware 94-3274498
------------------------ ------------------------------------
(State of incorporation) (I.R.S. Employer Identification No.)
One Post Street, Suite 2500
San Francisco, California 94104
----------------------------------------
(Address of principal executive offices)
(415) 956-4477
-------------------------------
(Registrant's telephone number)
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 ___
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock: $.001 Par Value, 7,290,236 shares as of May 8, 1998
Page 1 of 13
<PAGE>
BEI TECHNOLOGIES, INC. AND SUBSIDIARIES
INDEX
PART 1. FINANCIAL INFORMATION PAGE
--------------------- ----
Item 1. Financial Statements
Condensed Consolidated Balance Sheets--April 4, 1998
and September 27, 1997 3
Condensed Consolidated Statements of Operations--Quarter
and Six Months ended April 4, 1998 and March 29, 1997 4
Condensed Consolidated Statements of Cash Flows-Six
Months ended April 4, 1998 and March 29, 1997 5
Notes to Condensed Consolidated Financial Statements--
April 4, 1998 6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 9
PART II. OTHER INFORMATION
Item 4. Submission of Matters to Vote of Security Holders 12
Item 6. Exhibits and Reports on Form 8-K 12
(a) Exhibits
27.1 Financial Data Schedule
(b) Reports on Form 8-K
SIGNATURES 13
Page 2 of 13
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
BEI TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<CAPTION>
April 4, September 27,
1998 1997
(Unaudited) (See note below)
(dollars in thousands)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 4,115 $ 5,034
Trade receivables, net 16,880 17,241
Inventories, net -- Note 2 28,074 22,656
Other current assets 6,542 5,618
Current assets of discontinued operations -- Note 3 1,015 1,418
------- -------
Total current assets 56,626 51,967
Property, plant and equipment, net 26,572 25,361
Acquired technology 5,497 5,977
Goodwill 628 654
Other assets, net 4,017 3,825
Non-current assets of discontinued operations -- Note 3 1,518 1,625
------- -------
$94,858 $89,409
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Trade accounts payable $ 7,705 $ 6,317
Accrued expenses and other liabilities 8,413 10,497
Current portion of long-term debt 5,628 5,628
Current liabilities of discontinued operations -- Note 3 2,160 2,558
------- -------
Total current liabilities 23,906 25,000
Long-term debt, less current portion 31,895 27,508
Other liabilities 330 284
Stockholders' equity 38,727 36,617
------- -------
$94,858 $89,409
======= =======
<FN>
See notes to condensed consolidated financial statements
Note: The balance sheet at September 27, 1997 has been derived from the audited consolidated balance sheet at that date.
</FN>
Page 3 of 13
</TABLE>
<PAGE>
<TABLE>
BEI TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
Quarter Ended Six Months Ended
-------------------- --------------------
April 4, March 29, April 4, March 29,
1998 1997 1998 1997
(dollars in thousands except per share amounts)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net sales $30,848 $24,710 $59,104 $47,613
Cost of sales 20,930 15,900 39,564 31,036
------- ------- ------- -------
9,918 8,810 19,540 16,577
Selling, general and administrative expenses 6,262 5,915 12,380 13,029
Research, development and related expenses 1,796 1,070 3,192 1,965
------- ------- ------- -------
Income from operations 1,860 1,825 3,968 1,583
Interest expense 706 475 1,347 951
Other income 167 77 249 188
------- ------- ------- -------
Income from continuing operations before
income taxes 1,321 1,427 2,870 820
Provision for income taxes 542 470 1,214 222
------- ------- ------- -------
Income from continuing operations 779 957 1,656 598
Income from discontinued operations, net of income taxes 10 495 92 889
------- ------- ------- -------
Net income $ 789 $ 1,452 $ 1,748 $ 1,487
======= ======= ======= =======
Earnings per Common Share -- Note 4
Basic Earnings per Common Share
Income from continuing operations, net of
income taxes $ 0.11 $ 0.14 $ 0.24 $ 0.09
Income from discontinued operations, net of income taxes -- 0.07 0.01 0.13
------- ------- ------- -------
Net income per common share $ 0.11 $ 0.21 $ 0.25 $ 0.22
======= ======= ======= =======
Diluted Earnings per Common and Common Equivalent Share
Income from continuing operations, net of income taxes $ 0.11 $ 0.13 $ 0.23 $ 0.08
Income from discontinued operations, net of income taxes -- 0.07 0.01 0.13
------- ------- ------- -------
Net income per common and common
equivalent share $ 0.11 $ 0.20 $ 0.24 $ 0.21
======= ======= ======= =======
Dividends per common share $ 0.02 -- $ 0.04 --
======= ======= ======= =======
<FN>
See notes to condensed consolidated financial statements.
</FN>
Page 4 of 13
</TABLE>
<PAGE>
<TABLE>
BEI TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Six Months Ended
------------------------
April 4 March 29,
1998 1997
(dollars in thousands)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Net cash used in operating activities $ (2,126) $ (1,358)
Cash flows from investing activities:
Purchases of property, plant and equipment (4,432) (2,786)
-------- --------
Net cash used in investing activities (4,432) (2,786)
Cash flows from financing activities:
Proceeds from issuance of long-term debt 10,000 --
Payments on long-term debt (5,611) (12)
Proceeds from sale of equipment in sale - leaseback transaction 1,076 --
Proceeds from issuance of common stock 462 --
Increase in payable to BEI Electronics, Inc. -- 1,006
Payment of cash dividends (288) --
-------- --------
Net cash provided by financing activities 5,639 994
-------- --------
Net decrease in cash and cash equivalents (919) (3,150)
Cash and cash equivalents at beginning of period 5,034 8,201
-------- --------
Cash and cash equivalents at end of period $ 4,115 $ 5,051
======== ========
Supplemental schedule of non-cash investing and financing activities:
Decrease in long-term debt of BEI Electronics, Inc. assumed by BEI Technologies, Inc. $ -- $ (5,600)
======== ========
<FN>
See notes to condensed consolidated financial statements.
</FN>
Page 5 of 13
</TABLE>
<PAGE>
BEI TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
April 4, 1998
NOTE 1 -- BASIS OF PRESENTATION
The accompanying condensed financial statements of BEI Technologies, Inc.
("Technologies" or the "Company") present the condensed financial position and
results of operations of BEI Sensors & Systems Company, Inc. ("Sensors &
Systems") and Defense Systems Company, Inc. ("Defense Systems") former
subsidiaries of BEI Electronics, Inc. ("Electronics") and predecessor entities
to the Company, on a consolidated basis for all dates and periods prior to the
distribution event described below. All intercompany accounts and transactions
have been eliminated. The financial position and results of operations of the
Sensors & Systems business segment are presented as continuing operations and
those of the Defense Systems business segment are presented as discontinued
operations.
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. 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, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the interim periods presented are not
necessarily indicative of the results that may be expected for the year ending
October 3, 1998. For further information, refer to the consolidated financial
statements and footnotes thereto in the Company's annual report on Form 10-K for
the year ended September 27, 1997.
Technologies was incorporated on June 30, 1997 in the State of Delaware, as a
wholly owned subsidiary of Electronics. On September 27, 1997, Electronics
distributed to holders of Electronics common stock one share of common stock of
the Company for each share of Electronics common stock held on September 24,
1997 (the "Distribution"). In connection with the Distribution, Electronics
transferred to Technologies all of the assets, liabilities and operations of its
Sensors & Systems and Defense Systems business segments.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make certain estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported results of operations during the reporting period.
Actual results could differ from those estimates.
Page 6 of 13
<PAGE>
NOTE 2 -- INVENTORIES
April 4, September 27,
1998 1997
(dollars in thousands)
---------------------
Finished products $ 1,300 $ 557
Work in process 11,151 7,412
Materials 15,619 12,302
Costs incurred under long-term contracts,
including U.S. Government contracts 4 2,385
------- -------
Net inventories $28,074 $22,656
======= =======
NOTE 3 -- DISCONTINUED OPERATIONS
On June 30, 1997, the Board of Directors of Electronics, the
predecessor of Technologies, announced a formal plan to discontinue the
operations of the Defense Systems segment. Accordingly, the results of
operations of the segment have been presented as discontinued operations for all
periods presented and the assets and liabilities of the segment have been
segregated in the consolidated balance sheets. The remaining assets are stated
at cost, which management believes approximates net realizable value, and
management does not expect any material loss from the on-going operations or
abandonment of the Defense Systems segment. Previously, in September 1995,
Electronics had reached a decision to exit the HYDRA 70 rocket manufacturing
line of business which made up a substantial portion of the Defense Systems
segment. Additional products for the segment included weapons management systems
and sales under a cost-plus-fee advanced rocket development contract.
As a result of the decision to exit the rocket line of business, the
Company has incurred costs relating to employee severance and the closure and
withdrawal from the leased facility in Camden, Arkansas and similar costs
related to its owned facility in Euless, Texas. At September 27, 1997,
substantially all inventory and equipment assets for the rocket business had
been written off or disposed of. The balance in the reserve at the end of the
second quarter of fiscal year 1998 was not significant. The remaining assets of
Defense Systems are classified as assets of discontinued operations on the
balance sheet. Management expects to complete the disposition of these assets
during fiscal 1998.
Page 7 of 13
<PAGE>
NOTE 4 -- EARNINGS PER SHARE
<TABLE>
The following table sets forth the computation of basic and diluted earnings per
common share from continuing operations:
<CAPTION>
Quarter Ended Six Months Ended
---------------------- ----------------------
April 4, March 29, April 4, March 29,
1998 1997 1998 1997
---------------------- ----------------------
(in thousands except per share amounts)
<S> <C> <C> <C> <C>
Numerator
Income (loss) from continuing operations, net of
income taxes $ 779 $ 957 $1,656 $ 598
====== ====== ====== ======
Denominator
Denominator for basic earnings per share --
Weighted average shares, net of nonvested
shares (FY 1998 -- 256 shares; FY 1997 -
206 shares) 6,984 6,844 6,967 6,842
Effect of dilutive securities:
Nonvested shares 118 81 67 49
Employee stock options 182 170 175 171
------ ------ ------ ------
Denominator for diluted earnings per share 7,284 7,095 7,209 7,062
====== ====== ====== ======
Basic earnings per share from continuing
operations $ 0.11 $ 0.14 $ 0.24 $ 0.09
====== ====== ====== ======
Diluted earnings per share from continuing
operations $ 0.11 $ 0.13 $ 0.23 $ 0.08
====== ====== ====== ======
</TABLE>
NOTE 5 -- CONTINGENCIES AND LITIGATION
Claim Against U.S. Government
In 1996, Defense Systems filed a substantial claim against the U.S. Government
in connection with the parties' HYDRA 70 rocket contract. The discovery phase of
the litigation is currently in process. Depositions are scheduled for the third
quarter of fiscal 1998 for the trial beginning in the latter part of the fiscal
year.
Other
The Company has pending various legal actions arising in the normal course of
business. None of these legal actions is expected to have a material effect on
the Company's operating results or financial condition.
Page 8 of 13
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Except for the historical information contained herein, the following discussion
contains forward-looking statements that involve risks and uncertainties. The
Company's actual results could differ materially from those discussed here.
Factors that could cause or contribute to such differences include, but are not
limited to, those discussed in this section, and those discussed in the
Company's Form 10-K for the year ended September 27, 1997.
<TABLE>
The following table sets forth, for the fiscal periods indicated, the percentage
of net sales represented by certain items in the Company's Condensed
Consolidated Statements of Operations.
<CAPTION>
Quarter Ended Six Months Ended
---------------------- --------------------
April 4, March 29 April 4, March 29,
1998 1997 1998 1997
---------------------- --------------------
<S> <C> <C> <C> <C>
Net sales 100.0 % 100.0% 100.0 % 100.0%
Cost of sales 67.8 64.3 66.9 65.2
----- ----- ----- -----
Gross margin 32.2 35.7 33.1 34.8
Operating expenses
Selling, general and administrative expenses 20.3 24.0 20.9 27.4
Research, development and related expenses 5.8 4.3 5.4 4.1
----- ----- ----- -----
Income from operations 6.1 7.4 6.8 3.3
Interest expense 2.3 1.9 2.3 2.0
Other income 0.5 0.3 0.4 0.4
----- ----- ----- -----
Income from continuing operations before
income taxes 4.3 5.8 4.9 1.7
Provision for income taxes 1.8 1.9 2.1 0.5
----- ----- ----- -----
Income from continuing operations 2.5 3.9 2.8 1.2
Income from discontinued operations, net of income taxes 0.1 2.0 0.2 1.9
----- ----- ----- -----
Net income 2.6% 5.9% 3.0 % 3.1%
===== ===== ===== =====
</TABLE>
Quarters ended April 4, 1998 and March 29, 1997
Net sales for the second quarter of fiscal 1998, ended April 4, 1998, increased
$6.1 million or 24.8% to $30.8 million from $24.7 million during the same period
in fiscal 1997.
Commercial sales increased 42.9% compared to the same quarter in the prior year
but were partially offset by a decrease of 28.1% in sales related to government
contracts. Sales of traditional commercial products, including encoders and
other position sensors, motors, actuators and pressure sensors, increased.
Commercial sales of more recently introduced automotive products, primarily
quartz yaw rate sensors used in automotive stability control systems, also
increased. The decline in sales related to government contracts resulted from
timing of shipments for defense and aerospace customers.
Page 9 of 13
<PAGE>
Cost of sales as a percentage of net sales in the second quarter of fiscal 1998
increased to 67.8% from 64.3% in the comparable period of fiscal 1997, due to
several factors. Cost of sales as a percentage of sales improved in most product
areas. However, even with improvement automotive gyrochip sensors have a higher
than average cost of sales as a percentage of sales compared to traditional
products. Other offsetting factors included the unfavorable impact of reworking
or replacing materials on some products, primarily automotive steering sensors,
and, most significantly, declines in average margins realized from some
government contracts when compared to the same quarter of the prior year.
Actual selling, general and administrative expenses increased 5.9% from the same
quarter of the prior year compared to the 24.8% increase in sales. This resulted
in a decrease of 3.7 percentage points in selling, general and administrative
expenses as a percentage of net sales in the second quarter of fiscal 1998
versus the comparable period of fiscal 1997.
Research, development and related expenses, as a percentage of net sales for the
second quarter of fiscal 1998 increased 1.5 percentage points from the
comparable period of fiscal 1997 due to increased spending on potential new
products and processes related primarily to microelectromechanical structures
for pressure and automotive applications.
Six Months ended April 4, 1998 and March 29, 1997
Net sales for the first six months of fiscal 1998 increased $11.5 million or
24.1% to $59.1 million from $47.6 million during the same period in fiscal 1997.
Commercial sales increased primarily in sales to the industrial and automotive
markets. Sales of traditional commercial products, including encoders and other
position sensors, motors, actuators and pressure sensors, increased. Commercial
sales of more recently introduced automotive products, primarily quartz yaw rate
sensors, also increased. The sales increase was offset, in part, by decreased
sales related to government contract delays. Customer- supplied components for
government satellite programs originally scheduled for delivery during the first
quarter are now scheduled for delivery late in the third quarter. Other products
under contracts with foreign governments scheduled for export during the period
were delayed pending approval of an export license. The license was approved
subsequent to the end of the quarter.
Cost of sales as a percentage of net sales in the first six months of fiscal
1998 increased to 66.9% from 65.2% in the comparable period of fiscal 1997 due
to several factors. Cost of sales as a percentage of sales improved in most
product areas. However, even with improvement, automotive gyrochip sensors have
a higher than average cost of sales as a percentage of sales compared to
traditional products. Other offsetting factors included the unfavorable impact
of reworking or replacing materials on some products, primarily automotive
steering sensors, and declines in average margins on some programs related to
government contracts.
Actual selling, general and administrative expenses decreased 5.0% from the same
period of the prior year as compared to the 24.1% increase in sales. This
resulted in a decrease of 6.5 percentage points in selling, general and
administrative expenses as a percentage of net sales in the first six months of
fiscal 1998 versus the comparable period of fiscal 1997.
Research, development and related expenses as a percentage of net sales for the
first six months of fiscal 1998 increased 1.3 percentage points from the
comparable period of fiscal 1997 due to increased spending on potential new
products and processes related primarily to microelectromechanical structures
for pressure and automotive applications.
Page 10 of 13
<PAGE>
Liquidity and Capital Resources
During the first six months of fiscal 1998, total cash used by operations was
$2.1 million, including an increase in inventory on hand of $5.4 million and
decreases in accrued expenses, trade payables and other liabilities of $1.6
million. Partially offsetting these outflows was the net income of $1.7 million
and the positive impact of non-cash charges to income from depreciation of $2.1
million and amortization of $0.9 million. Additional cash generated from
receivable collections of $0.3 million during the period was offset by an
increase in other current assets of the same amount.
Cash used in investing activities consisted primarily of equipment purchases of
$4.4 million.
Cash flows from financing activities consisted primarily of $10.0 million in
proceeds from borrowings and $0.5 million from common stock issuances. Proceeds
from the sale of equipment in a sale-leaseback transaction provided $1.1
million. Offsetting these proceeds were $5.6 million in scheduled payments made
on long-term debt and dividend payments of $0.3 million.
The Company did not have material capital commitments at April 4, 1998. However,
the Company has committed to acquire approximately $2.6 million of equipment to
support quartz yaw rate sensor production.
Based on the financial condition of the Company at April 4, 1998, management
believes that the existing cash balances, cash generated from operations, and
available lines of credit will be sufficient to meet the Company's planned needs
for the foreseeable future. If the Company requires additional capital, it
anticipates that such capital will be provided by bank or other borrowings,
although there can be no assurances that funds will be available, or will be
available on terms as favorable as those applicable to the Company's currently
outstanding debt.
Year 2000 Compliance: Modification of Management Information Systems
The Company is evaluating the potential impact of what is commonly referred to
as the "Year 2000" issue, concerning the possible inability of certain
information systems to properly recognize and process dates containing the Year
2000 and beyond. If not corrected, these systems could fail or create erroneous
results. The Company's management information systems primarily use software
products purchased from commercial sources without significant modification or
customization. Updates to these products are routinely installed by the Company
to upgrade the systems and correct known faults in the software. All major
systems have been reviewed for Year 2000 issues and where necessary, upgraded
software has been identified and implementation schedules are in process. There
have been no significant incremental costs identified with updates that
specifically address only Year 2000 compliance. The Company is working with
consultants to review and validate Year 2000 efforts which will add costs to the
next several quarters. Notwithstanding the Year 2000 compliance of the Company's
systems, there can be no assurance that the Company will not be adversely
affected by the failure of others to become Year 2000 compliant.
Effects of Inflation
Management believes that, for the periods presented, inflation has not had a
material effect on the Company's operations.
Page 11 of 13
<PAGE>
BEI TECHNOLOGIES, INC. AND SUBSIDIARIES
PART II. OTHER INFORMATION
Item 4. Submission of Matters to Vote of Security Holders
(a) The Annual Meeting of Stockholders of the Company (the
"Meeting") was held on March 6, 1998. At the Meeting, Charles
Crocker and George S. Brown were re-elected to the Company's
Board of Directors for a three-year term expiring at the
Company's 2001 Annual Meeting.
Shares voted:
For Withheld
--------------------------------
Crocker 6,738,482 8,636
Brown 6,736,382 10,736
(b) In addition, the following directors continued in office as
directors of the Company following the Meeting: C. Joseph
Giroir, Jr., Asad M. Madni, and Gary D. Wrench (until the
Company's 1999 Annual Meeting); Richard M. Brooks, William G.
Howard, Jr., and Robert Mehrabian (until the Company's 2000
Annual Meeting).
The other matters presented at the Meeting and the voting of
stockholders with respect thereto are as follows:
(i) The stockholders ratified the Board of Directors'
selection of Ernst & Young LLP as the Company's independent
public accountants for the fiscal year ending October 3, 1998.
Shares voted:
For Against Abstain
--------------------------------------------
6,738,482 1,886 27,814
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27.1 Financial Data Schedule
(b) Reports on Form 8-K
No reports on Form 8-K were filed by the Company during the
quarter ended April 4, 1998.
Page 12 of 13
<PAGE>
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 on May 18, 1998.
BEI Technologies, Inc.
By: /s/ Robert R. Corr
-----------------------------------
Robert R. Corr
Secretary, Treasurer and Controller
(Chief Accounting Officer)
Page 13 of 13
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED APRIL 4,
1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-03-1998
<PERIOD-START> DEC-28-1997
<PERIOD-END> APR-04-1998
<CASH> 4,115
<SECURITIES> 0
<RECEIVABLES> 16,880
<ALLOWANCES> 0
<INVENTORY> 28,074
<CURRENT-ASSETS> 56,626
<PP&E> 26,572
<DEPRECIATION> 0
<TOTAL-ASSETS> 94,858
<CURRENT-LIABILITIES> 23,906
<BONDS> 31,895
0
0
<COMMON> 7
<OTHER-SE> 38,720
<TOTAL-LIABILITY-AND-EQUITY> 94,858
<SALES> 30,848
<TOTAL-REVENUES> 31,015
<CGS> 20,930
<TOTAL-COSTS> 8,058
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 706
<INCOME-PRETAX> 1,321
<INCOME-TAX> 542
<INCOME-CONTINUING> 779
<DISCONTINUED> 10
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 789
<EPS-PRIMARY> 0.11
<EPS-DILUTED> 0.11
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED MARCH
29, 1997
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-27-1997
<PERIOD-START> DEC-29-1996
<PERIOD-END> MAR-29-1997
<CASH> 5,051
<SECURITIES> 0
<RECEIVABLES> 17,786
<ALLOWANCES> 608
<INVENTORY> 21,737
<CURRENT-ASSETS> 50,686
<PP&E> 51,362
<DEPRECIATION> 28,450
<TOTAL-ASSETS> 87,226
<CURRENT-LIABILITIES> 21,197
<BONDS> 18,523
0
0
<COMMON> 0
<OTHER-SE> 39,672
<TOTAL-LIABILITY-AND-EQUITY> 87,226
<SALES> 24,710
<TOTAL-REVENUES> 24,787
<CGS> 15,900
<TOTAL-COSTS> 6,985
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 475
<INCOME-PRETAX> 1,427
<INCOME-TAX> 470
<INCOME-CONTINUING> 957
<DISCONTINUED> 495
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,452
<EPS-PRIMARY> 0.21
<EPS-DILUTED> 0.20
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE CONDENSED CONSOIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED MARCH
29, 1997
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-27-1997
<PERIOD-START> DEC-29-1996
<PERIOD-END> MAR-29-1997
<CASH> 5,051
<SECURITIES> 0
<RECEIVABLES> 17,786
<ALLOWANCES> 608
<INVENTORY> 21,737
<CURRENT-ASSETS> 50,686
<PP&E> 51,362
<DEPRECIATION> 28,450
<TOTAL-ASSETS> 87,226
<CURRENT-LIABILITIES> 21,197
<BONDS> 18,523
0
0
<COMMON> 0
<OTHER-SE> 39,672
<TOTAL-LIABILITY-AND-EQUITY> 87,226
<SALES> 47,613
<TOTAL-REVENUES> 47,801
<CGS> 31,036
<TOTAL-COSTS> 14,994
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 951
<INCOME-PRETAX> 820
<INCOME-TAX> 222
<INCOME-CONTINUING> 598
<DISCONTINUED> 859
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,487
<EPS-PRIMARY> 0.22
<EPS-DILUTED> 0.21
</TABLE>
