<PAGE>
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 March 31, 1999
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: 333-32041
---------------
PRECISE TECHNOLOGY, INC.
(Exact name of registrant as specified in its charter)
Delaware 25-1205268
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
501 Mosside Boulevard
North Versailles, Pennsylvania 15137-2553
(Address of principal executive (Zip Code)
offices)
(412) 823-2100
(Registrant's telephone number, including area code)
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 ____
As of May 14, 1999, one share of the Company's Common Stock was
outstanding.
1
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TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements 3
ITEM 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 11
ITEM 3. Quantitative and Qualitative Disclosures
About Market Risk 14
PART II - OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K 14
2
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
PRECISE TECHNOLOGY, INC.
(A WHOLLY-OWNED SUBSIDIARY OF
PRECISE HOLDING CORPORATION)
CONSOLIDATED BALANCE SHEETS
(In thousands)
March 31, December 31,
1999 1998
---- ----
ASSETS (unaudited)
Current assets:
Cash and cash equivalents $ 1,090 $ 240
Accounts receivable, net 16,337 14,931
Inventories 7,874 6,510
Prepaid expenses and other 899 453
Deferred income taxes 806 806
---------------------------
Total current assets 27,006 22,940
Property, plant and equipment, net 42,185 43,537
Intangible and other assets, net 26,263 26,931
---------------------------
Total assets $95,454 $93,408
===========================
LIABILITIES AND STOCKHOLDER'S DEFICIT
Current Liabilities:
Current maturities of long-term debt $ 7,524 $10,193
Accounts payable 9,389 6,607
Accrued liabilities 6,134 4,109
Tooling deposits 4,523 3,963
---------------------------
Total current liabilities 27,570 24,872
Long-term debt, less current maturities 79,387 80,031
Deferred income taxes 998 998
Commitments and Contingencies -- --
Stockholder's deficit:
Common stock, no par value; 1,000 shares
authorized, and 1 share issued and
outstanding at March 31, 1999 and 1 1
December 31, 1998, respectively.
Additional paid-in-capital 3,555 3,555
Minimum pension liability (292) (292)
Retained deficit (15,765) (15,757)
---------------------------
Total stockholder's deficit (12,501) (12,493)
---------------------------
Total liabilities and stockholder's $ 95,454 $93,408
deficit ===========================
See accompanying notes.
3
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PRECISE TECHNOLOGY, INC.
(A WHOLLY-OWNED SUBSIDIARY OF
PRECISE HOLDING CORPORATION)
CONSOLIDATED STATEMENTS OF INCOME
(In thousands)
Three Months Ended
March 31,
--------------------------
1999 1998
(unaudited)
Net sales $26,811 $23,395
Cost of sales 20,761 18,913
--------------------------
Gross profit 6,050 4,482
Selling, general, and 3,091 2,503
administrative
Plant closure costs -- 30
Amortization of intangible 254 314
assets
--------------------------
Operating income 2,705 1,635
Other expense (income):
Interest expense 2,519 2,626
Other (1) (13)
--------------------------
Income (loss) before income 187 (978)
taxes
Provision (benefit) for 195 (187)
income taxes --------------------------
Net loss $ (8) $ (791)
==========================
See accompanying notes.
4
<PAGE>
PRECISE TECHNOLOGY, INC.
(A WHOLLY-OWNED SUBSIDIARY OF
PRECISE HOLDING CORPORATION)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Three Months Ended March
31,
----------------------------
1999 1998
---- ----
Operating Activities (unaudited)
Net loss $ (8) $ (791)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization 1,970 1,853
Amortization of financing fees 139 139
Loss on sale of fixed assets 13 30
Changes in assets and liabilities:
Accounts receivable (1,406) (1,705)
Inventories (1,364) (200)
Prepaid expenses and other (172) 438
Accounts payable 2,782 505
Accrued liabilities 2,025 345
Tooling deposits 560 1,965
----------------------------
Net cash provided by operating activities 4,539 2,579
Investing Activities
Capital expenditures (377) (1,270)
Proceeds from sale of fixed assets -- 49
----------------------------
Net cash used in investing activities (377) (1,221)
Financing Activities
Borrowings on revolving line of credit 5,200 1,400
Payments on revolving line of credit (7,600) (1,000)
Repayment of long-term debt (912) (852)
----------------------------
Net cash used in financing activities (3,312) (452)
----------------------------
Net increase in cash 850 906
Cash at beginning of period 240 560
----------------------------
Cash at end of period $ 1,090 $1,466
============================
See accompanying notes.
5
<PAGE>
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(In thousands)
Three Months Ended
March 31,
----------------------------
1999 1998
---- ----
(unaudited)
Supplemental disclosures of cash flow
information:
Cash paid during the period for:
Interest $266 $398
============================
Income taxes, net of refund $ 41 $232
============================
Supplemental schedule of noncash investing
and financing activities:
Capital lease agreements for equipment $ -- $210
============================
See accompanying notes.
6
<PAGE>
PRECISE TECHNOLOGY, INC.
(A WHOLLY-OWNED SUBSIDIARY OF
PRECISE HOLDING CORPORATION)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1999
(Unaudited)
1. Financial Statement Presentation
The consolidated balance sheet at March 31, 1999, and the consolidated
statements of income and consolidated statements of cash flows for the periods
ended March 31, 1999 and 1998, have been prepared by Precise Technology, Inc.
(the "Company"), without audit. In the opinion of Management, all adjustments
necessary to present fairly the financial position, results of operations and
changes in cash flows at March 31, 1999 and for the periods presented have been
made.
The accompanying condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions for Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required for complete financial statements prepared
in accordance with generally accepted accounting principles. It is suggested
that these consolidated financial statements be read in conjunction with the
Company's annual report on Form 10-K for the year ended December 31, 1998 which
contains a summary of the Company's accounting principles and other
information.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
The results of operations for the period ended March 31, 1999 are not
necessarily indicative of the operating results to be expected for the full
year.
2. Inventories
The major components of inventories were as follows:
March 31, December 31,
1999 1998
-------------- -------------
(unaudited)
Finished products $1,337 $1,309
Raw materials 2,126 2,085
Tooling and dies 4,411 3,116
-------------- -------------
Total $7,874 $6,510
============== =============
7
<PAGE>
PRECISE TECHNOLOGY, INC.
(A WHOLLY-OWNED SUBSIDIARY OF
PRECISE HOLDING CORPORATION)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1999
(Unaudited)
3. Commitments and Contingencies
The Company is involved from time to time in lawsuits that arise in the
normal course of business. The Company actively and vigorously defends all
lawsuits. Management believes that there are no pending lawsuits that will have
a material affect on the Company's financial position.
4. Long -Term Debt
On June 13, 1997, the Company entered into a $30 million Credit Agreement
with a financial institution, which expires in 2002. The Credit Agreement
contains certain covenants which require the Company to maintain leverage
ratios, fixed charge and interest coverage ratios and minimum net worth. The
Credit Agreement further limits capital expenditures, declaration of dividends
and other restricted payments, and additional indebtedness. The Credit
Agreement also restricts the sale or transferring of the Company's assets or
capital stock. As of March 31, 1999, the financial institution has agreed to a
limited waiver of certain requirements of the credit agreement. Such waiver
terminates on July 2, 1999. Management is currently in negotiations with the
financial institution to amend the Credit Agreement.
5. Segment Information
The Company has two reportable segments: injection molding and mold
making. The Company's injection molding segment produces highly engineered,
close tolerance, precision plastic products. The Company's mold making segment
has extensive tool and die manufacturing capabilities.
The Company evaluates performance and allocates resources based on gross
margin. The Company does not allocate certain corporate general and
administration expenses to its operating segments including depreciation,
amortization and interest expense.
The Company's reportable segments are business units that offer different
products and services. The reportable segments are each managed separately
because they manufacture and distribute distinct products or services with
different production processes.
8
<PAGE>
PRECISE TECHNOLOGY, INC.
(A WHOLLY-OWNED SUBSIDIARY OF
PRECISE HOLDING CORPORATION)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1999
(Unaudited)
5. Segment Information - (continued)
Information by industry segment is set forth below:
Three Months Ended March 31, 1999
-------------------------------------------
Unallocated
Injection Mold Corporate Total
Molding Making Items Consolidated
---------- ---------- ---------- ------------
(in thousands)
Revenues from external
customers $22,278 $ 4,533 $ -- $26,811
Segment gross margin 5,926 124 -- 6,050
Depreciation and
amortization expense 1,358 263 349 1,970
Interest expense -- -- 2,519 2,519
Segment assets 48,287 13,174 33,993 95,454
Net capital expenditures 334 -- 43 377
Three Months Ended March 31, 1998
-------------------------------------------
Unallocated
Injection Mold Corporate Total
Molding Making Items Consolidated
---------- ---------- ---------- ------------
(in thousands)
Revenues from external
customers $19,816 $ 3,579 $ -- $23,395
Segment gross margin 4,247 235 -- 4,482
Depreciation and
amortization expense 1,222 255 376 1,853
Interest expense -- -- 2,626 2,626
Segment assets 50,179 10,608 34,743 95,530
Net capital expenditures 1,261 19 200 1,480
9
<PAGE>
PRECISE TECHNOLOGY, INC.
(A WHOLLY-OWNED SUBSIDIARY OF
PRECISE HOLDING CORPORATION)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1999
(Unaudited)
6. Financial Information for Subsidiary Guarantors
The Company's payment obligations under the 11-1/8% Senior Subordinated
Notes due 2007 are fully and unconditionally guaranteed on a joint and several
basis (collectively, the "Subsidiary Guarantees") by Precise Technology of
Delaware, Inc., Precise Technology of Illinois, Inc., Precise TMP, Inc.,
Precise Polestar, Inc., and Massie Tool, Mold and Die, Inc., each a direct or
indirect wholly-owned subsidiary of the Company and each a "Guarantor." These
subsidiaries represent substantially all of the operations of the Company
conducted in the United States. In accordance with previous positions taken by
the Securities and Exchange Commission, the following summarized financial
information illustrates the composition of the combined Guarantors. Separate
complete financial statements of the respective Guarantors are not presented
because management has determined that they would not provide additional
material information that would be useful in assessing the financial
composition of the Guarantors. No single Guarantor has any significant legal
restrictions on the ability of investors or creditors to obtain access to its
assets in the event of a default on its Subsidiary Guarantees other than its
subordination to senior indebtedness. The principal elimination entries
eliminate investments in subsidiaries and intercompany balances and
transactions.
Summarized Combined Financial Information
For the Three Months Ended March 31, 1999
(In thousands and unaudited)
Guarantor Consolidated
Parent Subsidiaries Eliminations Total
------ ------------ ------------ -----
Current assets $ 7,448 $54,906 $(35,348) $27,006
Non-current assets 83,350 53,930 (68,832) 68,448
Current liabilities 49,359 13,559 (35,348) 27,570
Non-current liabilities 73,256 7,129 -- 80,385
Net sales 5,363 21,526 (78) 26,811
Gross profit 942 5,108 -- 6,050
Net (loss) income (2,324) 2,316 -- (8)
Summarized Combined Financial Information
For the Three Months Ended March 31, 1998
(In thousands and unaudited)
Guarantor Consolidated
Parent Subsidiaries Eliminations Total
------ ------------ ------------ -----
Current assets $ 6,408 $55,953 $(38,821) $23,540
Non-current assets 84,363 56,459 (68,832) 71,990
Current liabilities 32,494 25,375 (38,821) 19,048
Non-current liabilities 80,709 6,924 -- 87,633
Net sales 3,551 19,956 (112) 23,395
Gross profit 646 3,836 -- 4,482
Net (loss) income (1,935) 1,144 -- (791)
10
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Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The Company's operating data for the three months ended March 31, 1999 and 1998
are set forth below as percentages of net sales:
Three Months Ended
March 31,
------------------
1999 1998
Net sales 100.0% 100.0%
Cost of sales 77.4 80.8
-------- --------
Gross profit 22.6 19.2
Selling, general and
administrative 11.5 10.7
Plant closure costs 0.0 0.1
Amortization of intangible
assets 1.0 1.4
-------- --------
Operating income
Other expense (income): 10.1 7.0
Interest expense 9.4 11.2
Other 0.0 0.0
-------- --------
Income (loss) before income
taxes 0.7 (4.2)
Provision (benefit) for income
taxes 0.7 (0.8)
-------- --------
Net loss (0.0)% (3.4)%
======== ========
RESULTS OF OPERATIONS
Three Months Ended March 31,1999 compared to Three Months Ended March 31, 1998
Net sales. The Company's net sales increased to $26.8 million for the
three months ended March 31, 1999, an increase of $3.4 million, or 14.6%, from
the comparable period in the prior year. The increase in net sales was
attributable to increased injection molding sales and mold making sales.
Injection molding sales for the three months ended March 31, 1999
increased $2.4 million, or 12.1%, to $22.2 million due to a full quarter
of production in 1999 of a significant new program which was in the start-up
phase in 1998, and the addition of other new product lines in 1999. This
increase was partially offset by decreased volumes to certain customers who
have either insourced or have selected another molder with a closer "ship-to"
point.
Mold making sales for the three months ended March 31, 1999 increased
$1.0 million, or 26.7%, to $4.6 million. The increase is primarily due to new
mold making programs that will ultimately result in new sales for the
injection molding segment.
Gross Profit. The Company's gross profit increased to $6.1 million for
the three months ended March 31, 1999, an increase of $1.6 million, or 35.0%,
from the comparable period in the prior year. The increase in gross profit is
primarily due to the increase in injection molding gross profit that was
slightly offset by the decrease in mold making gross profit. Gross profit
margin increased to 22.6% for the three months ended March 31, 1999 from 19.2%
in the comparable period in the prior year.
Injection molding's gross profit for the three months ended March 31,
1999 increased $1.7 million, or 39.6%, to $5.9 million due to (i) increased
employee utilization, (ii) increased equipment utilization, (iii) a favorable
product mix and (iv) decreased raw material content from aggressive purchasing
tactics and a favorable scrap rate.
Mold making's gross profit for the three months ended March 31, 1999
decreased $0.1million, or 47.4%, to $0.1 million due to cost overruns on
certain projects.
11
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Selling, general and administrative. Selling, general and administrative
expenses increased to $3.1 million for the three months ended March 31, 1999,
an increase of $0.6 million, or 23.5%, over the comparable period in the prior
year. The increase in selling, general and administrative expenses was
primarily due to increased salaries, wages and fringe benefits due to annual
merit increases and increased professional fees relating to acquisition related
activities.
Amortization. The Company's amortization of intangible assets decreased
to $254,000 for the three months ended March 31, 1999 from $314,000 in the
comparable period in the prior year. This decrease resulted primarily from the
expiration of non-compete agreements during July of 1998.
Operating income. Operating income increased to $2.7 million for the
three months ended March 31, 1999, an increase of $1.1 million, or 65.4%, over
the comparable period in the prior year. Operating income as a percentage of
net sales increased to 10.1% for the three months ended March 31, 1999 from
7.0% in the comparable period in the prior year primarily due to higher gross
margin which was partially offset by higher selling, general and administrative
expenses.
Interest expense. Interest expense decreased to $2.5 million for the
three months ended March 31, 1999 from $2.6 million in the comparable period in
the prior year representing a decrease of 4.1%. This decrease is primarily a
result of interest due on a lower level of indebtedness outstanding.
Provision for income tax. The Company's effective tax rates differed from
the applicable statutory rates for the three months ended March 31, 1999 and
1998 primarily due to nondeductible goodwill amortization.
Liquidity and Capital Resources
The Company generated cash flows from operations totaling $4.5 million
and $2.6 million in the three months ended March 31, 1999 and 1998,
respectively. The increase in cash flows from operations is primarily
attributable to a decrease in net loss and an increase in accounts payable.
The Company's cash flows used in investing activities totaled $0.4
million and $1.2 million, excluding capital lease agreements for equipment
totaling $0.2 million in the three months ended March 31, 1998. During the
first three months of 1999, the Company expended approximately $0.4 million in
cash capital expenditures primarily for auxiliary and assembly equipment.
During the first three months of 1998, the Company expended
approximately $0.2 million in cash capital expenditures primarily for its new
Enterprise Resource Planning system, $0.5 million in cash capital expenditures
on plant refurbishment and $0.3 million in cash capital expenditures on
machinery and ancillary equipment for a new project for one of the Company's
larger customers. Based on new programs awarded during the first three months
of 1999, the Company expects an increase in capital expenditures and anticipates
seeking consent from its lenders to adjust capital and other covenants to
allow for the increased capital requirements.
The Company's cash flows used in financing activities totaled $3.3
million and $0.5 million for the three months ended March 31, 1999 and 1998,
respectively. During the three months ended March 31, 1999, regularly scheduled
principal payments on the Company's capital lease obligations and payments on
the revolving line of credit contributed to the cash used in financing
activities. During the three months ended March 31, 1998, cash used in
financing activities was comprised of regularly scheduled principal payments on
the Company's capital lease obligations which was partially offset by
borrowings on the revolving line of credit.
Management believes that the Company's cash flow from operations,
together with borrowings under its Credit Agreement, of which $25.4 million was
available at March 31, 1999, provides it with sufficient liquidity necessary to
fund capital improvements, service indebtedness and meet working capital
requirements for the Company's existing operations. However, the Company is
highly leveraged and, as a result, funds available for working capital, capital
expenditures, and other purposes may be limited or unavailable in the event the
Company does not generate cash flow at or above expected levels, which could
have a material adverse effect on the Company's business, financial condition
and results of operations.
12
<PAGE>
Year 2000 Disclosure
The Company is currently working to resolve the potential impact of the
year 2000 on the processing of time-sensitive information by the Company's
computerized information systems. The year 2000 issue ("Y2K") is the result of
computer programs being written using two digits rather than four to define the
applicable year. Any of the Company's computer programs that have
date-sensitive software may recognize a date using "00" as the year 1900 rather
than the year 2000. This could result in a system failure or miscalculations
causing disruptions of operations, including, among other things, a temporary
inability to process transactions, send invoices or engage in similar business
activities.
State of Readiness. In 1997, the Company began a program to assess the
impact of the Y2K issue on the software and hardware used in the Company's
operations and has identified various areas to focus its Y2K compliance
efforts. They include business computer systems, manufacturing and warehousing
systems, end-user computing, technical infrastructure, and supplier and service
provider systems. The program's phases include assessment and planning,
remediation, testing and implementation.
The Company's management has developed a program to prepare the Company's
computer systems and related applications for the Y2K. The Company believes
that a majority of its Y2K issues will be addressed by the installation of an
Enterprise Resource Planning ("ERP") system software package by Baan. The ERP
system, which is Y2K compliant and will be used for the Company's primary
business application at its headquarters and manufacturing facilities,
currently is being installed. All of the Company's facilities are expected to
be using the ERP system by October 1999. The Company has developed a
comprehensive plan to assist all departments and manufacturing facilities in
working towards compliance with Y2K issues for all other systems beyond those
being addressed by the ERP system. The Company expects to have identified and
performed procedures to make compliant those other systems beyond the ERP
system by the fourth quarter of 1999. If the Company's systems or the systems
of other companies on whose services the Company depends or with whom the
Company's systems interface are not Y2K compliant, it could have a material
adverse effect on the Company's business, financial condition and results of
operations.
Y2K Costs. Total costs for the Company's Y2K compliance efforts are
currently estimated to be approximately $3.0 to $3.5 million. The majority of
these costs relates to the ERP system installations and upgrades of which a
portion have been, and will be capitalized and charged to expense over the
estimated useful life of the associated software and hardware. The remaining
costs have been, and will be charged directly to expense. Amounts capitalized
for the years ended December 31, 1998 and 1997 were approximately $0.5 million
and $1.0 million, respectively. Amounts charged to expense for the years ended
December 31, 1998, and 1997 were $0.5 million and $0.2 million, respectively.
During the three months ended March 31, 1999 approximately $100,000 was charged
to expense.
Y2K Risks. The reasonable worst-case scenario for the Company with
respect to the Y2K problem is the failure of a key system or supplier system
that causes shipments of the Company's products to customers to be temporarily
interrupted. This could result in the Company not being able to produce one or
more product lines for a period of time, which in turn could lead to lost sales
and profits for the Company and its customers. The Company is in the process of
conducting a Y2K assessment survey for all of its suppliers and customers.
Favorable risk assessments for Y2K compliance have been received by a number of
the Company's suppliers and customers.
Contingency Plans. As a part of the Company's Y2K strategy, contingency
plans have been developed and any systems requiring remediation have one or
more contingency plans. The Company's staff, independent accountants and the
Board of Directors are updated on a regular basis as to the Y2K status. In
addition, supplier site audits, where appropriate, are to be performed in 1999.
Recent Accounting Standards
13
<PAGE>
In June 1998, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards ("SFAS") No. 133, Accounting of Derivative
Instruments and Hedging Activities, which establishes accounting and reporting
standards for derivative instruments, including certain derivative instruments
embedded in other contracts, and for hedging activities. The implementation of
SFAS No. 133 is not expected to have a significant impact on the Company's
financial statements. The standard will be effective for the Company for the
year ended December 31, 2000.
Cautionary Statement on Forward-Looking Statements
This Report contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Investors are cautioned that
any forward-looking statements, including statements regarding the intent,
belief, or current expectations of the Company or its management, are not
guarantees of future performance and involve risks, uncertainties, and other
factors, some of which are beyond the Company's control, and that actual
results may differ materially from those in forward-looking statements. Such
risks, uncertainties and other factors include, but are not limited to: (i)
general economic conditions in the markets in which the Company operates, (ii)
reliance on key customers and supply contracts, (iii) volatility of customer
demand (iv) exposure to fluctuations in resin cost and supply, (v) customer
outsourcing decisions, (vi) reliance on key manufacturing facilities, (vii) the
impact of significant competition from companies of varying sizes including
divisions or subsidiaries of larger companies and (viii) other risks detailed
from time to time in the Company's Securities and Exchange Commission filings.
The Company does not intend to update these forward-looking statements.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company is exposed to market risk from changes in interest rates. The
Company's primary interest rate risk relates to its long-term debt obligations.
At March 31, 1999, the Company had total long-term obligations, including the
current portion of those obligations, of approximately $86.9 million. Of that
amount $82.3 million was in fixed rate obligations and $4.6 million was in
variable rate obligations. Assuming a 10% increase in interest rates on the
Company's variable rate obligations (i.e., an increase from the March 31, 1999
weighted average interest rate of 7.81% to a weighted average interest rate of
8.59%), interest expense for the three months ended March 31, 1999 would be
approximately $9,000 higher based on the March 31, 1999 outstanding balance of
variable rate obligations. The Company has no interest rate swap or exchange
agreements.
PART II - OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
(i) Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K
None
14
<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.
PRECISE TECHNOLOGY, INC.
(Registrant)
Date May 17, 1999 /s/ John R. Weeks
------------ -----------------
John R. Weeks
President and Chief Executive Officer
Date May 17, 1999 /s/ Gregory R. Conley
------------ ---------------------
Gregory R. Conley
Vice President and Chief Financial Officer
(Principal financial and accounting officer)
15
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM (1) THE
CONSOLIDATED UNAUDITED INTERIM FINANCIAL STATEMENTS OF PRECISE TECHNOLOGY, INC.
AS OF MARCH 31, 1999 AND FOR THE THREE MONTHS THEN ENDED AND (2) THE
CONSOLIDATED FINANCIAL STATEMENTS OF PRECISE TECHNOLOGY, INC. AS OF DECEMBER
31, 1998 AND FOR THE YEAR THEN ENDED AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 12-MOS
<FISCAL-YEAR-END> DEC-31-1999 DEC-31-1998
<PERIOD-END> MAR-31-1999 DEC-31-1998
<CASH> 1,090 240
<SECURITIES> 0 0
<RECEIVABLES> 16,503 15,097
<ALLOWANCES> 166 166
<INVENTORY> 7,874 6,510
<CURRENT-ASSETS> 26,543 22,940
<PP&E> 62,902 62,080
<DEPRECIATION> 20,254 18,543
<TOTAL-ASSETS> 95,454 93,408
<CURRENT-LIABILITIES> 25,570 24,872
<BONDS> 0 0
0 0
0 0
<COMMON> 1 1
<OTHER-SE> (12,501) (12,494)
<TOTAL-LIABILITY-AND-EQUITY> 95,454 93,408
<SALES> 26,811 98,025
<TOTAL-REVENUES> 26,811 98,025
<CGS> 20,761 77,459
<TOTAL-COSTS> 24,106 89,382
<OTHER-EXPENSES> (1) (51)
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 2,519 10,311
<INCOME-PRETAX> 187 (1,617)
<INCOME-TAX> 195 427
<INCOME-CONTINUING> (8) (2,044)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (8) (2,044)
<EPS-PRIMARY> 0.0 0.0
<EPS-DILUTED> 0.0 0.0
</TABLE>
