<PAGE> 1
================================================================================
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 1997
[ ] 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 000-23207
NEUTRAL POSTURE ERGONOMICS, INC.
(Exact name of small business issuer as specified in its charter)
TEXAS 74-2563656
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
3904 N. TEXAS AVENUE
BRYAN, TEXAS 77803 (409) 778-0502
(Address of principal executive offices) Issuer's telephone number
CHECK WHETHER THE ISSUER (1) HAS 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 LAST PRACTICABLE DATE; 3,200,000, SHARES OUTSTANDING AS
OF JANUARY 31, 1998.
TRANSITIONAL SMALL BUSINESS DISCLOSURE FORMAT
YES NO X
------- --------
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<PAGE> 2
NEUTRAL POSTURE ERGONOMICS, INC.
Quarterly Report on Form 10-QSB
for the Quarter Ended December 31, 1997
(Unaudited)
<TABLE>
<CAPTION>
Page
Number
<S> <C>
PART I FINANCIAL INFORMATION
Item 1. Condensed Financial Statements
Condensed Balance Sheets as of December 31, 1997 and June 30, 1997 .................................... 1
Condensed Statements of Income for the Three and Six Months Ended December 31, 1997 and 1996 .......... 2
Condensed Statements of Cash Flows for the Six Months Ended December 31, 1997 and 1996 ................ 3
Notes to Condensed Financial Statements ............................................................... 4
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Income .............. 6
PART II. OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds ...................................................... 10
Item 6. Exhibits and Reports on Form 8-K ............................................................... 11
SIGNATURES .................................................................................................... 12
</TABLE>
<PAGE> 3
NEUTRAL POSTURE ERGONOMICS, INC.
CONDENSED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
1997 1997
----------- -----------
(Unaudited)
<S> <C> <C>
Current Assets:
Cash and cash equivalents .................................................. $ 4,785,150 $ 294,014
Accounts receivable - net .................................................. 1,655,616 1,124,227
Inventories ................................................................ 435,662 507,577
Deferred Income Tax Benefit ................................................ 93,000 --
Prepaid expenses and other ................................................. 128,595 156,947
----------- -----------
Total current assets ............................................... 7,098,023 2,082,765
Property and Equipment - Net .................................................... 1,447,784 1,434,939
Notes Receivable - shareholders ................................................. 118,175 118,175
Deposits and Other .............................................................. 115,929 62,162
----------- -----------
Total .............................................................. $ 8,779,911 $ 3,698,041
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt .......................................... $ 26,077 $ 26,077
Accounts payable ........................................................... 825,491 755,264
Accrued liabilities ........................................................ 492,944 563,135
Income taxes payable ....................................................... 184,685 47,706
Distributions payable to shareholders ...................................... -- 100,000
----------- -----------
Total current liabilities .......................................... 1,529,197 1,492,182
Long-Term Debt - Less current portion ........................................... 593,644 606,591
Deferred income tax liability ................................................... 72,000 --
Shareholders' Equity:
Common stock: $.01 par value; 14,000,000 shares authorized; 3,200,000
and 2,300,000 shares issued and outstanding, respectively ............. 32,000 23,000
Additional paid-in capital ................................................. 5,643,331 382,000
Retained earnings .......................................................... 1,065,584 1,373,238
Accounts and notes receivable - shareholders ............................... (95,845) (95,845)
Deferred compensation - stock options granted .............................. (60,000) (83,125)
----------- -----------
Total shareholders' equity ......................................... 6,585,070 1,599,268
----------- -----------
Total .............................................................. $ 8,779,911 $ 3,698,041
=========== ===========
</TABLE>
See notes to condensed financial statements.
-1-
<PAGE> 4
NEUTRAL POSTURE ERGONOMICS, INC.
CONDENSED STATEMENTS OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS SIX MONTHS
ENDED DECEMBER 31, ENDED DECEMBER 31,
-------------------------- --------------------------
1997 1996 1997 1996
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net Sales ............................................... $ 3,076,724 $ 3,052,194 $ 6,025,960 $ 6,021,842
Cost of Sales ........................................... 1,817,516 1,971,817 3,609,127 3,820,795
----------- ----------- ----------- -----------
Gross Profit ............................................ 1,259,208 1,080,377 2,416,833 2,201,047
Operating Expenses:
Selling ................................................. 324,571 340,502 638,161 618,014
General and administrative ........................... 555,582 518,594 1,061,406 1,089,507
----------- ----------- ----------- -----------
Total ........................................... 880,153 859,096 1,699,567 1,707,521
----------- ----------- ----------- -----------
Operating Income ........................................ 379,055 221,281 717,266 493,526
Other Income (Expense):
Interest expense ..................................... (16,443) (42,721) (32,628) (84,449)
Interest income ...................................... 43,750 9,591 44,008 10,688
Other ................................................ 41,687 2,510 41,682 7,306
----------- ----------- ----------- -----------
Total ........................................... 68,994 (30,620) 53,062 (66,455)
----------- ----------- ----------- -----------
Income Before Income Taxes .............................. 448,049 190,661 770,328 427,071
Pro Forma Income Taxes (Benefit) (Note 3) ............... 140,813 (7,306) 259,640 79,810
----------- ----------- ----------- -----------
Pro Forma Net Income .................................... $ 307,236 $ 197,967 $ 510,688 $ 347,261
=========== =========== =========== ===========
Pro Forma Net Income Per Common Share (EPS):
Basic EPS ............................................ $ .10 $ .09 $ .19 $ .15
=========== =========== =========== ===========
EPS - assuming dilution .............................. $ .10 $ .08 $ .18 $ .14
=========== =========== =========== ===========
Weighted Average Shares:
Common Shares Outstanding ............................ 3,004,348 2,300,000 2,652,174 2,300,000
=========== =========== =========== ===========
Adjusted Shares - assuming exercise of stock options.. 3,141,697 2,500,000 2,786,184 2,500,000
=========== =========== =========== ===========
</TABLE>
See notes to condensed financial statements.
-2-
<PAGE> 5
NEUTRAL POSTURE ERGONOMICS, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
FOR THE SIX MONTHS
--------------------------
ENDED DECEMBER 31,
--------------------------
1997 1996
----------- -----------
<S> <C> <C>
Operating Activities:
Pro forma net income ................................................... $ 510,688 $ 347,261
Noncash items in net income:
Depreciation - property and equipment .............................. 97,939 75,406
Amortization of deferred compensation .............................. 92,734 --
Amortization of patent and licensing agreement ..................... 12,609 --
Changes in operating working capital:
Accounts receivable ................................................ (531,389) (203,961)
Inventories ........................................................ 71,915 58,228
Deferred income taxes (net) ........................................ (21,000) --
Prepaid expenses and other ......................................... 28,352 45,973
Accounts payable ................................................... 70,227 (33,403)
Accrued liabilities ................................................ (70,191) (11,392)
Income taxes payable ............................................... 136,979 15,775
Deposits and other ................................................. (66,375) 34,405
----------- -----------
Pro forma net cash provided by operating activities ........... 332,488 328,292
Pro forma income tax expense ....................................... 104,809 142,477
----------- -----------
Historical net cash from provided by operating activities ..... 437,297 470,769
----------- -----------
Investing Activities:
Additions to property and equipment .................................... (110,784) (186,081)
Proceeds from sale of property and equipment ........................... -- --
----------- -----------
Net cash used for investing activities ........................ (110,784) (186,081)
----------- -----------
Financing Activities:
Issuance of debt ....................................................... 200,000 --
Payments on debt ....................................................... (212,947) (135,305)
Capital contribution by S Corp. shareholders ........................... 43,345 --
Distribution to S. Corp. shareholders (Note 5) ......................... (235,000) --
Proceeds from issuance of common stock ................................. 5,400,000 --
Stock offering costs ................................................... (1,030,775) --
----------- -----------
Net cash provided by (used for) financing activities........... 4,164,623 (135,305)
----------- -----------
Increase in Cash and Cash Equivalents ....................................... 4,491,136 149,383
Cash and Cash Equivalents:
Beginning of period .................................................... 294,014 39,623
----------- -----------
End of period .......................................................... $ 4,785,150 $ 189,006
=========== ===========
</TABLE>
See notes to condensed financial statements.
-3-
<PAGE> 6
NEUTRAL POSTURE ERGONOMICS, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
1. INTERIM FINANCIAL STATEMENTS
The condensed interim financial statements included herein have
been prepared by Neutral Posture Ergonomics, Inc. ("Neutral Posture" or the
"Company"), without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission (the "Commission"). The financial statements
reflect adjustments of a normal recurring nature which are, in the opinion of
management, necessary to present fairly such information. Although the Company
believes that the disclosures are adequate to make the interim information
presented not misleading, certain information and footnote disclosures,
including significant accounting policies, normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to such rules and regulations. These
interim financial statements should be read in conjunction with the financial
statements and the notes thereto, for the fiscal year ended June 30, 1997
included in the Company's Registration Statement on Form SB-1, as amended.
Quarterly operating results may vary significantly and are not necessarily
indicative of the results for the full year or any future period.
2. INVENTORIES
Inventories consist primarily of raw materials and are stated at
the lower of cost (on the first-in, first-out method) or market.
3. PRO FORMA INCOME TAXES
Effective April 1, 1996, the Company elected taxation status as an
S corporation under the Internal Revenue Code, with profits and losses
reportable by the shareholders on their individual income tax returns. Pro forma
income taxes represent the applicable pro forma adjustments for federal and
state income taxes as if the Company had not been treated as an S Corporation
for the applicable portion of the three and six month periods ended December 31,
1997 and 1996. Upon completion of the public offering in October 1997 as
described in note 4 below, the Company terminated its status as an S Corporation
and is subject to such income taxes. After that date, current and deferred
income taxes have been provided for as appropriate.
4. INITIAL PUBLIC OFFERING
On October 20, 1997, the Company completed an initial public
offering of common stock and the private placement of common stock warrants.
Proceeds of the offering, less underwriter's commissions and fees and other
offering expenses were approximately $4.4 million for the 900,000 new common
shares issued by the Company. Selling shareholders sold 434,000 common shares
for which the Company received no benefit. In addition to the common stock
issued, warrants to purchase 133,400 shares of common stock at an exercise price
of $7.20 were granted to the underwriter. These warrants are exercisable over a
period of four years commencing one year from consummation of the offering.
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<PAGE> 7
5. DIVIDENDS
On October 9, 1997, prior to completion of the Company's initial public
offering, the Company declared a cash dividend to its S Corporation
shareholders of record on that date in the amount of $.0587 per share,
for a total distribution of $135,000, to provide for those shareholders'
estimated federal income tax obligations attributable to the Company's S
corporation earnings for the period from July 1, 1997 through the
consummation of the offering. The cash dividend was paid on October 14,
1997 from earnings of the Company. The Company has no intention of
declaring or paying any other dividend or making any other distribution
to its shareholders in the near future. The remaining undistributed S
Corporation earnings of $788,152 at the closing date of the initial
public offering have been reclassified from retained earnings to
additional paid in capital.
-5-
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The following discussion may be understood more fully by reference
to the financial statements, notes to the financial statements, and management's
discussion and analysis contained in the Company's Registration Statement on
Form SB-1, as amended.
GENERAL. The Company generates revenue through sales of its products to
corporate customers and retailers through independent sales
representatives, who generally are paid a commission for each unit sold.
These independent sales representatives channel sales through dealers
located throughout the United States who acquire the products from the
Company at a discount from suggested retail and then resell the products to
the ultimate customers. These dealers typically provide end-users a range
of "value-added" services that may include installation, delivery, site
planning and warranty repairs.
Because the Company is utilizing "value-added" dealers, the Company has
been able to increase sales of higher priced models. The Company believes
that those end-users reached through such higher quality dealers generally
prefer, in addition to the value-added services of such dealers, its
higher-priced models inasmuch as the Company believes the purchasing
decisions of such end-users are not focused solely on price but also on
other factors.
RESULTS OF OPERATIONS. The following table sets forth the percentage
relationship to net sales of certain items in the Company's statements of
income for the periods indicated:
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
December 31, December 31,
-------------------- --------------------
1997 1996 1997 1996
-------- ------- ------- -------
<S> <C> <C> <C> <C>
Net sales 100.0% 100.0% 100.0% 100.0%
Cost of sales 59.1 64.6 59.9 63.4
----- ----- ----- -----
Gross profit 40.9 35.4 40.1 36.6
Selling, general and administrative expenses 28.6 28.1 28.2 28.4
----- ----- ----- -----
Operating income 12.3 7.3 11.9 8.2
===== ===== ===== =====
</TABLE>
THREE AND SIX MONTHS ENDED DECEMBER 31, 1997 COMPARED TO THREE AND SIX
MONTHS ENDED DECEMBER 31, 1996
Net Sales. Net sales for the three and six month periods ended December
31, 1997 remained flat at approximately $3.0 million and $6.0 million,
respectively, as compared to the three and six month periods ended December
31, 1996. The number of units sold decreased approximately 13% for both
1997 periods, but was offset by an increase in average selling price due to
the Company's strategy of shifting the product mix of sales to higher
priced models sold to or through dealers. The decrease in units sold is
primarily a result of decreased sales to a major customer that suffered a
temporary strike in mid-1997.
Gross Profit. Gross profit for the three month period ended December
31, 1997 was $1.3 million, or 40.9% of net sales, as compared to $1.1
million, or 35.4% of net sales, for the similar three month period in 1996.
Gross profit for the six month period ended December 31, 1997 was $2.4
million, or 40.1% of net sales, as compared to $2.2 million, or 36.6% of
net sales, for the comparable 1996 period. The gross profit percentage in
the current quarter of 40.9% represents a continued improvement over the
previous quarter (ended September 30, 1997) of 39.3%. Although the cost per
chair remained relatively flat, these increases in gross profit were the
result of the shift in strategy to sales of higher priced models as
discussed in "Net Sales" above.
-6-
<PAGE> 9
Selling, General and Administrative Expenses. Selling, general and
administrative expenses were $880,153 and $1.7 million for the three and
six month periods ended December 31, 1997, remaining relatively flat as
compared to similar periods in 1996. As a percentage of sales, the
Company's selling, general and administrative expenses remained at
approximately 28% of net sales for all periods presented.
Operating Income. As a result of the foregoing, operating income for
the three and six month periods ended December 31, 1997 was $379,055 and
$717,266, respectively, increasing $157,774, or approximately 71%, from
$221,281 for the three month period ended December 31, 1996 and increasing
$223,740, or approximately 45% from the six month period ended December 31,
1996. As a percentage of sales, operating income increased to 11.9% for the
six month period in 1997 from 8.2% from the similar period in 1996.
Other Income (Expense). Other income (expense) increased approximately
$100,000 in both l997 periods as compared to similar l996 periods.
Reductions in interest expense and increases in interest income resulting
from the Company's completion of its initial public offering in October
1997 accounted for a majority of the increase.
Pro Forma Income Taxes (Benefit). For the three month period ended
December 31, 1997, the effective pro forma income tax rate was
approximately 31% as compared to 0% for the similar three month 1996 period
due to tax credit refunds received. On an equivalent basis, using the three
month 1997 period effective tax rate, net income per share would have been
$.06 per share - basic and diluted for the three month period ended
December 31, 1996 versus this year's $.10 per share - basic and diluted a
67% increase.
Earnings per Share. The pro forma net income per share amounts for the
three and six month periods ended December 31, 1997, and based on the
weighted average share outstanding, which includes the effects of the
additional 900,000 shares issued in the initial public offering in October
1997.
LIQUIDITY AND CAPITAL RESOURCES.
In October 1997, the Company completed an initial public offering of
common stock. Proceeds of the offering, less underwriter's commissions and
fees and other offering expenses, were approximately $4.4 million. The
Company intends to use the net proceeds from the offering (i) to develop,
manufacture and market computERGO(TM), (ii) to seek to obtain ISO 9000
certification, (iii) to enhance the Company's core products and to develop
additional ergonomic products, (iv) to add engineering and marketing
resources, (v) to repay outstanding bank indebtedness, and (vi) for working
capital. The Company utilized $200,000 of the proceeds to repay outstanding
indebtedness on its bank credit facility as of December 31,1997.
The Company's other sources of capital are net cash provided by
operating activities and availability of funds under the Revolving Credit
Facility discussed below. The Company's primary capital requirements,
excluding items covered above, are to fund component parts inventory,
receivables, research and development activities, and product improvements.
The Company currently maintains a $2.0 million Revolving Credit
Facility. The amount available under the Revolving Credit Facility is
determined based on a percentage of eligible receivables. At December 31,
1997, no amounts were outstanding under this facility. The Company also
maintains a Term Facility in the amount of $500,000 to fund equipment and
mold purchases. No amounts were borrowed under this facility. The credit
facilities contain restrictions and financial covenants relating to various
financial ratios, including net worth and levels of debt compared to net
worth. As of December 31, 1997, the Company was in compliance with such
restrictions and covenants.
-7-
<PAGE> 10
Cash provided by operating activities totaled $332,488 (before pro
forma income taxes) for the six month period ended December 31, 1997, as
compared to cash provided by operating activities of $328,292 for the six
month period ended December 31, 1996. Increases in net income were offset
by changes in working capital related to decreases in accounts payable and
increases in receivables.
Cash used in investing activities totaled $110,784 and $186,081 for the
six month period ended December 31, 1997 and 1996, respectively, and was
primarily comprised of various capital expenditures. During the remainder
of fiscal year 1998, the Company expects to continue to make capital
expenditures in connection with manufacturing equipment, office and
computer equipment and other items as outlined above related to the initial
public offering.
Financing activities provided funds totaling $4,164,623 for the six
month period ended December 31, 1997. These funds were primarily generated
from net proceeds from consummation of the initial public offering. For the
six month period ended December 31, 1996, financing activities used funds
totaling $135,305 to repay borrowings under the Company's credit
facilities.
In October 1997, prior to consummation of the initial public offering,
the Company declared and paid a cash dividend totaling $135,000 to its
existing S Corporation shareholders. This distribution, as well as payment
of the distribution payable of $100,000 at June 30, 1997, are amounts to
cover the former S Corporation shareholders' estimated federal and state
income tax obligations attributable to the Company's S Corporation earnings
through consummation of the initial public offering. Subsequent to the
initial public offering, the Company has no intention of declaring or
paying any other dividend to its shareholders in the near future.
The Company entered into an agreement with a third party early in 1997
to design and produce injection molds to be utilized in the production
process for approximately $400,000. The Company has paid approximately
$150,000 through December 31, 1997, and expects to pay the remaining
$250,000 upon completion of these molds in early 1998.
The Company believes that cash flow from operations, together with the
net proceeds from the public offering and its unused capacity under the
Revolving Credit Facility should be sufficient to fund its anticipated
operating needs, and capital expenditures through fiscal year 1998.
However, because the Company's future operating results will depend on a
number of factors, including the demand for the Company's products, the
level of competition and general economic conditions and other factors
beyond the Company's control, there can be no assurance that the Company's
capital resources will be sufficient to fund the Company's operations
beyond such date.
Year 2000 Issue. The year 2000 issue 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
normal business activities. The Company intends to purchase and implement
upgrades for its current software to resolve this issue within the next
twelve months. The Company does not anticipate the cost of such upgrades to
be significant. The Company also plans to upgrade systems as needed that
will already be year 2000 compliant. While the Company has taken every
precaution to ensure that the new information system will operate properly
in the year 2000, management has relied on assurances and warranties by
its software vendors. As such, the Company cannot rule out the possibility
of year 2000 issues.
-8-
<PAGE> 11
CAUTIONARY STATEMENT. With the exception of historical information, the
matters discussed under "General" "Results of Operations" and "Liquidity
and Capital Resources" contain forward-looking statements. There are
certain important factors which could cause results to differ materially
from those anticipated by some of the forward-looking statements. Some of
the important factors which could cause actual results to differ materially
from those in the forward-looking statements include, among other things,
changes from anticipated levels of sales, whether due to future national or
regional economic and competitive conditions, changes in relationships with
customers including, but not limited to, the Company's relationship with
its significant customers, customer acceptance of existing and new
products, pricing pressures due to excess capacity, raw material cost
increases, change of tax rates, change of interest rates, declining
conditions in the industry, validity of patents, availability of key
component parts, casualty to or other disruption of the Company's
production facility and equipment, delays and disruptions in the shipment
of the Company's products and raw materials and other factors that
generally affect businesses.
-9-
<PAGE> 12
PART II
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
(c) On October 24, 1997, the Company granted Huberman
Financial, Inc. (the "Underwriter"), the underwriter of
its offering of Common Stock that commenced on October 20,
1997, warrants to purchase up to 133,400 shares of Common
Stock (the "Underwriter's Warrants"). The Underwriter
acquired the Underwriter's Warrants for $10.00 and for
services provided by the Underwriter pursuant to the
Company's offering Common Stock. Because the Underwriter
was deemed to be an "accredited investor" and the issuance
of the Underwriter's Warrants did not involve a public
offering, the Underwriter's Warrants were issued by the
Company in reliance upon certain exemptions from
registration under the Securities Act of 1933, as amended
(the "Securities Act"), including Section 4(2) of the
Securities Act and Rule 506 promulgated thereunder. The
terms of exercise of the Underwriter's Warrants have been
previously reported on pages 38 and 39 of the Company's
Registration Statement on Form SB-I (the "Registration
Statement"), File No. 333-33675.
(d) (1) The Company filed the Registration Statement, which
was declared effective by the Securities and Exchange
Commission on October 16, 1997, File No. 333-33675.
(4)(v) From October 16, 1997 to December 31, 1997,, the
Company incurred approximately $1,030,775 of expenses
in connection with the offering as follows:
(1) $432,000 in underwriting discounts and
commissions;
(2) $3,432 for Securities and Exchange Commission
Registration Fee;
(3) $1,498 for NASD filing fee;
(4) $22,000 for NASDAQ National Market Listing Fee;
(5) $75,817 for printing expenses;
(6) $176,915 for accounting fees and expenses ;
(7) $255,291 for legal fees and expenses;
(8) $2,642 for fees of transfer agent and
registrar ; and
(9) $63,180 for miscellaneous expenses
None of such payments were direct or indirect
payments to directors, officers, general partners of
the issuer or their associates; to persons owning 10%
or more of any class of equity securities of the
issuer; and to affiliates of the issuer. All of such
expenses were direct or indirect payments to others.
(vii) The Company has utilized $200,000 to repay
outstanding indebtedness on its revolving credit
facility.
-10-
<PAGE> 13
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 during the quarter for which
this report is filed.
-11-
<PAGE> 14
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of
1934, the registrant has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
NEUTRAL POSTURE ERGONOMICS, INC.
Date: February 17, 1998 By: /s/REBECCA E. BOENIGK
-----------------------------------
Rebecca E. Boenigk
Chairman of the Board
and Chief Executive Officer
(Principal Executive Officer)
Date: February 17, 1998 By: /s/GREGORY A. KATT
-----------------------------------
Gregory A. Katt
Vice President, Chief Financial
Officer, Secretary and Treasurers
(Principal Accounting Officer)
-12-
<PAGE> 15
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT
- ------ -------
<S> <C>
27.1 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> DEC-31-1997
<CASH> 4,785
<SECURITIES> 0
<RECEIVABLES> 1,723
<ALLOWANCES> 68
<INVENTORY> 436
<CURRENT-ASSETS> 7,098
<PP&E> 1,912
<DEPRECIATION> 464
<TOTAL-ASSETS> 8,780
<CURRENT-LIABILITIES> 1,529
<BONDS> 594
0
0
<COMMON> 32
<OTHER-SE> 6,553
<TOTAL-LIABILITY-AND-EQUITY> 8,780
<SALES> 3,077
<TOTAL-REVENUES> 3,077
<CGS> 1,818
<TOTAL-COSTS> 1,818
<OTHER-EXPENSES> 880
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 16
<INCOME-PRETAX> 448
<INCOME-TAX> 141
<INCOME-CONTINUING> 307
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 307
<EPS-PRIMARY> $.10
<EPS-DILUTED> $.10
</TABLE>
