SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For Quarterly Period Ended November 30, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from _________ to _________
Commission File Number 1-8381
WELDOTRON CORPORATION
______________________________________________________________________
(Exact name of Registrant as specified in its charter)
NEW JERSEY 22-1602728
_______________________________ ___________________
(State or other jurisdiction (I.R.S. Employer
incorporation or organization) Identification No.)
1532 South Washington Avenue
Piscataway, New Jersey 08855
____________________________________ __________
(Address of Principal Exec. Offices) (Zip Code)
Registrant's Telephone Number, Including
Area Code (908) 752-6700
_______________
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, and (2) has been subject to such filing requirements
for the past 90 days.
Yes X No
2,300,173 Shares of Common Stock were outstanding as of January 9, 1997.
<PAGE>
WELDOTRON CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
($000'S OMITTED EXCEPT SHARE DATA)
<TABLE>
<S> <C> <C>
Three Months Ended
November 30,
1996 1995
___________ ___________
(Unaudited) (Unaudited)
NET SALES $ 3,080 $ 4,225
COST AND EXPENSES:
Cost of Sales 2,240 2,839
Selling, General & Administrative Expenses 1,273 1,862
Depreciation and Amortization 95 125
3,608 4,826
LOSS FROM OPERATIONS (528) (601)
OTHER INCOME/(EXPENSES):
Foreign Currency Translation Gain (Loss) (12) 88
Other Income 118 166
Interest Expense (120) (174)
(14) 80
LOSS FROM OPERATIONS BEFORE
TAXES AND MINORITY INTEREST $ (542) $ (521)
INCOME TAX PROVISION $ -- $ (40)
MINORITY INTEREST: SHARE OF (INCOME) LOSS $ 27 $ (75)
NET LOSS $ (515) $ (636)
NET LOSS PER COMMON SHARE: $ (.22) $ (.28)
DIVIDEND PER SHARE NONE NONE
WEIGHTED AVERAGE OF
COMMON SHARES OUTSTANDING 2,300,173 2,300,173
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
<PAGE>
WELDOTRON CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
($000'S OMITTED EXCEPT SHARE DATA)
<TABLE>
<S> <C> <C>
Nine Months Ended
November 30,
1996 1995
(Unaudited) (Unaudited)
NET SALES $ 9,811 $ 13,753
COST AND EXPENSES:
Cost of Sales 7,209 8,816
Selling, General & Administrative Expenses 4,066 5,489
Depreciation and Amortization 298 372
$ 11,573 $ 14,677
LOSS FROM OPERATIONS (1,762) (924)
OTHER INCOME/(EXPENSES):
Foreign Currency Translation Gain (Loss) 23 117
Other Income 414 466
Interest Expense (449) (513)
(12) 70
LOSS FROM OPERATIONS BEFORE
AXES AND MINORITY INTEREST $ (1,774) $ (854)
INCOME TAX PROVISION $ -- $ (136)
MINORITY INTEREST: SHARE OF (INCOME) LOSS $ 62 $ (200)
NET LOSS $ (1,712) $ (1,190)
NET LOSS PER COMMON SHARE: $ (.74) $ (.52)
DIVIDEND PER SHARE NONE NONE
WEIGHTED AVERAGE OF
COMMON SHARES OUTSTANDING 2,300,173 2,300,173
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
<PAGE>
WELDOTRON CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
($000'S OMITTED)
<TABLE>
<S> <C> <C>
Nov. 30, Feb. 29,
1996 1996
(Unaudited) (Audited)
ASSETS
CURRENT ASSETS
Cash and Cash Equivalents $ 59 $ 344
Accounts Receivable (Net) 1,519 2,000
Inventories (Note B) 5,828 6,653
Prepaid Expenses and Other Current Assets 275 563
Investment in Real Estate Held for Sale -- 377
TOTAL CURRENT ASSETS 7,681 9,937
Property and Equipment at Cost 11,434 11,603
Less Accumulated Depreciation & Amort. $ (9,601) $ (9,497)
Net Property and Equipment 1,833 2,106
Other Assets and Investments 519 174
TOTAL ASSETS $ 10,033 $ 12,217
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Cash Overdraft $ 84 --
Short Term Borrowings (Note C) 1,086 $ 835
Short Term Borrowings: Related Party (Note C) 1,350 150
Accounts Payable 2,805 2,431
Other Current Liabilities 2,003 2,532
TOTAL CURRENT LIABILITIES 7,328 5,948
Long-Term Debt-Net of Current Maturities (Note C) -- 750
Long Term Debt: Related Party (Note C) -- 1,000
Deferred Compensation 1,174 1,201
Minority Interests in Subsidiary 614 715
Other Long Term Liabilities 188 161
Stockholders' Equity 729 2,442
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 10,033 $ 12,217
</TABLE>
The Balance Sheet at February 29, 1996, has been taken from the audited
financial statements at that date, condensed and reclassified.
See Notes to Condensed Consolidated Financial Statements.
WELDOTRON CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
($000'S OMITTED)
<TABLE>
<S> <C> <C>
Nine Months Ended
November 30,
1996 1995
(Unaudited) (Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (1,712) $ (1,190)
Adjustments to reconcile net loss to
net cash flows provided by (used in)
operating activities:
Depreciation and amortization 297 371
Foreign currency translation gain (23) (117)
Bad debt provision 19 19
Deferred compensation expense 85 95
Minority interest in subsidiary net income (loss) (62) 200
Gain on sale of property, plant and equipment (138) (29)
Changes in operating assets and liabilities
(Increase) decrease in assets
Accounts receivable 500 207
Inventories 980 (102)
Prepaid expenses and other current assets 226 (32)
Other assets 19 5
Increase (decrease) in current liabilities (119) 799
Increase in other long-term liabilities (123) (121)
Total adjustments 1,661 1,295
Net cash provided by (used in)
operating activities (51) 105
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment (180) (193)
Proceeds from the sales of
property, plant and equipment 138 29
Net cash used in investing activities (42) (164)
CASH FLOWS FROM FINANCING ACTIVITIES
Net proceeds (repayments) under short-term
borrowings 255 52
Proceeds from debt - Related Party 200 500
Principal payments under capital lease obligations (4) (1)
Reduction of long term debt (750) (750)
Cash Overdraft 84 --
Net cash used in financing activities (215) (199)
EFFECT OF EXCHANGE RATE CHANGES ON CASH
AND CASH EQUIVALENTS 23 117
NET DECREASE IN CASH AND CASH EQUIVALENTS (285) (141)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 344 438
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 59 $ 297
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
WELDOTRON CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note A: Basis of Preparation
The unaudited, condensed Consolidated Financial Statements as of November 30,
1996 and for the three and nine month period ended November 30, 1996 and 1995,
included herein, have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q and Rule 10-01. The information reflects all
adjustments which are of a normal recurring nature and which are, in the opinion
of management, necessary to a fair statement of the results for the period.
Certain financial information and footnote disclosures normally included in
financial statements prepared in accordance with the generally accepted
accounting principles have been condensed or omitted. The reader is referred to
the consolidated financial statements and notes thereto included in the
Registrant's annual report on Form 10-K for the year ended February 29, 1996.
Results of operations for the interim period are not necessarily indicative of
the operating results for the full year.
Note B: Inventories
Inventories at November 30, 1996, and February 29, 1996, are as follows:
($000's - Omitted)
<TABLE>
<S> <C> <C>
Nov. 30, Feb. 29,
1996 1996
Finished Goods $ 2,327 $ 2,870
Work in Process 2,409 2,508
Raw Materials 1,092 1,275
$ 5,828 $ 6,653
</TABLE>
Note C: Long-Term Debt and Short-Term Borrowings
In June 1991, the Company entered into a credit facility (the "Credit Facility")
with Congress Financial Corporation, ("Congress") which was amended on June 10,
1996. It provided a revolving line of credit and term loan of $2,500,000, an
interest rate of 3.75% over the Core States floating base rate, a maturity date
of June 25, 1997, and financial covenants as follows: minimum domestic working
capital of $1,700,000 and minimum domestic tangible net worth of $1,050,000.
The Credit Facility was collateralized by substantially all of the assets of the
Company and its domestic subsidiaries. Borrowings under the Credit Facility were
limited to certain percentages of eligible inventory and accounts receivable
including stipulations as to the ratio of advances collateralized by receivables
compared to advances collateralized by inventory.
The Company was in default of its minimum working capital and tangible net worth
covenants of the Credit Facility as of August 31, 1996 and November 30, 1996.
Subsequently, Congress Financial Corporation notified the Company of its
intention to terminate the Credit Facility due to the default as well as the
reduced size of the outstanding loan (below $1,000,000) and provided the Company
a period of time in which to seek alternative sources of financing. On December
10, 1996, the Company successfully entered into a new credit facility (the "New
Credit Facility") with Business Alliance Capital Corporation, ("BACC") to
provide a revolving line of credit for working capital purposes. The interest
rate is 3.0% over the Core States floating base rate which was 8.25% at November
30, 1996. The New Credit Facility further requires that the Company pay fees on
the average outstanding loan of 0.33% per month, for administration and upon
early termination of the New Credit Facility. The maximum line of credit is
$1,500,000 and the maturity date is December 10, 1998.
The New Credit Facility is collateralized by substantially all of the assets of
the Company and its domestic subsidiaries. Borrowings under the New Credit
Facility are limited to certain percentages of eligible inventory and accounts
receivable as well as a stipulation as to the maximum advance level on
inventory.
On August 31, 1994, the Registrant borrowed $500,000 Dollars from Lyford
Corporation ("Lyford"), an affiliated company that owns 19.56% of the issued and
outstanding common stock of the Company. The Company executed and delivered to
Lyford a promissory note, a security agreement and a Common Stock Purchase
Warrant granting to Lyford the right to purchase up to 200,000 shares of the
Company's common stock at an initial exercise price of two dollars per share,
the closing price for the Company's common stock on the date the warrant was
granted. The warrant expires on August 4, 2004.
On March 1, 1995, the Registrant concluded the rolling of this note into a new
note in the amount of $1,000,000. The new obligation is evidenced by a certain
Amended, Extended and Restated Promissory Note dated as of March 1, 1995 (the
"Restated Note"). In consideration for the new loan, the Company executed and
delivered to Lyford the Restated Note and an additional Common Stock Purchase
Warrant. The new note was originally due and payable on or before March 31, 1996
and bears interest at 12% per annum. The note was subsequently extended until
April 1, 1997 and the interest rate was increased to 14%. The new loan is
secured by a junior lien on all of the Company's assets. The new warrant grants
to Lyford the right to purchase up to 1,000,000 shares of the Company's common
stock at an initial exercise price of One ($1.00) Dollar per share. The market
price of the Company's common stock was $.875 on the date of the warrant grant.
The new warrant expires by its terms on April 12, 2005. The Company's management
considers the note to be at fair value and has not assigned any value to the
warrants. The loan transaction closed pursuant to documents dated as of March 1,
1995 and, in the case of the new Warrant, April 13, 1995. These loan documents
were contingent on the Company's obtaining the consent of its senior lender,
which consent was obtained on May 5, 1995.
In January, 1996 the Registrant entered into a $500,000 revolving loan agreement
with Exford Corp. (Exford), an affiliated company of Lyford. The Registrant
borrowed $350,000 under this agreement which borrowings bear interest at 14%,
and are due on January 31, 1997. In connection with this revolving loan, the
Company has assigned to Exford its right, title and interest as tenant under the
main operating lease, together with any rents due and payable to the Company.
WELDOTRON CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Financial Condition
The Registrant's net working capital decreased from $3,989,000 at February 29,
1996 to $353,000 at November 30, 1996. The current ratio decreased from 1.67 at
February 29,1996 to 1.05 at November 30, 1996. The changes in net working
capital during the first nine months of this year were primarily related to the
following:
- - accounts receivable decreased due to 32% lower sales in the third quarter of
this year compared to the fourth quarter of last year.
- - inventories decreased due to efforts to keep inventory levels in line with
reduced sales.
- - prepaid expenses and other current assets decreased due to prepaid insurance
amortization.
- - investment in real estate held for sale decreased due to the reclassification
of this asset to long term after reevaluating its probability of sale within the
next twelve months.
- - accounts payable increased as a result of extended payment terms with vendors.
- - short-term borrowings increased due to the reclassification of $750,000 of the
domestic bank term loan from long term to short term and increases in short-term
obligations at our Brazilian subsidiary.
- - short-term borrowings from a related party increased at November 30, 1996 due
to the reclassification of $1,000,000 from long-term to short-term.
- - other current liabilities decreased due to reduced accruals for wages and
insurance, as well as reduced customer deposits.
The Company was in default of its minimum working capital and tangible net worth
covenants of the Credit Facility as of August 31, 1996 and November 30, 1996.
Subsequently, Congress Financial Corporation notified the Company of its
intention to terminate the Credit Facility due to the default as well as the
reduced size of the outstanding loan (below $1,000,000) and provided the Company
a period of time in which to seek alternative sources of financing. On December
10, 1996, the Company successfully entered into a new credit facility (the "New
Credit Facility") with Business Alliance Capital Corporation, ("BACC") to
provide a revolving line of credit for working capital purposes. The interest
rate is 3.0% over the Core States floating base rate which was 8.25% at November
30, 1996. The New Credit Facility further requires that the Company pay fees on
the average outstanding loan of 0.33% per month, for administration and upon
early termination of the New Credit Facility. The maximum line of credit is
$1,500,000 and the maturity date is December 10, 1998.
The New Credit Facility is collateralized by substantially all of the assets of
the Company and its domestic subsidiaries. Borrowings under the New Credit
Facility are limited to certain percentages of eligible inventory and accounts
receivable as well as a stipulation as to the maximum advance level on
inventory.
At November 30, 1996 the Registrant had used approximately $949,000 of the
Congress Credit Facility (See Note C to the consolidated financial statements).
Based on the advance percentages of eligible receivables and inventories the
Registrant had unused borrowing availability of approximately $27,000 at
November 30, 1996.
The Registrant's primary and secondary sources of liquidity at November 30, 1996
were the notes from a related party and the Congress Credit Facility,
respectively. There can be no assurances that an extended economic recession
will not adversely impact the Registrant's future financial condition and
liquidity.
The effect of exchange rate changes on cash and cash equivalents for the nine
months ended November 30, 1996 and for the same period last year was $23,000 and
$117,000, respectively. This is attributable to Brazil's inflationary economy
and the "remeasurement method" used for foreign currency translation to be
measured into U.S. dollars as required by SFAS No. 52.
Results of Operations for the Three Month Period Ended
November 30, 1996 and 1995
______________________________________________________________________
For the third quarter ended November 30, 1996 sales were $3,080,000 with a net
loss of $515,000 or $.22 per share. This compares to sales of $4,225,000 with a
net loss of $636,000 or $.28 per share in the third quarter last year.
Sales for the third quarter were 27.1% lower than the same period last year,
with declines occurring in all segments of the business. Domestic packaging
sales were $625,000 lower than the similar quarter last year, or 24.5%; domestic
safety and automated systems sales were $255,000 lower, or 43.6%; and sales at
our Brazilian subsidiary were $265,000 lower, or 24.3%. Whereas industrial
packaging equipment sales were virtually unchanged from the third quarter of
last year, food packaging equipment's sales performance pulled overall packaging
sales down, due in large part to the Company's refocused marketing efforts
toward higher cash contributing industrial packaging products. The safety and
automated systems segment continues to reestablish its market presence, after
having been without inventory for an extended period of time a year ago, due to
exorbitant price increases and unfavorable foreign exchange rates with its
former major offshore supplier. That supplier situation has since been resolved
with the procurement of high quality material from domestic sources.
Cost of sales for the third quarter this year was 72.7% of sales compared to
67.2% for the prior year. The shift toward lower margin though higher total cash
contributing domestic industrial packaging sales this quarter, coupled with
generally higher costs as a percentage of sales in the safety and automated
systems and Brazilian segments caused the increase. The domestic packaging
segment's margins experienced a slight improvement this quarter as compared to
the third quarter of last year.
Selling, general and administrative expenses decreased by $589,000 in the third
quarter of fiscal 1997 compared to the same period last year due primarily to
staff reductions made toward the end of the third quarter of fiscal 1996, which
bore the cost of accrued severance as well as other employee related
expenditures. A foreign currency translation gain of $88,000 was recorded in the
third quarter last year compared to a loss of $12,000 in the third quarter this
year due to a less favorable Brazilian currency exchange rate.
Other income in the third quarter this year declined to $118,000 from $166,000
last year due primarily to debt related charges.
There was no provision for income taxes in the third quarter this year versus
$40,000 in the third quarter last year. The provision last year was based solely
on taxable income from our Brazilian subsidiary of $151,000.
Interest expense decreased $54,000 due to lower average borrowings.
Results of Operations for the Nine Months Ended
November 30, 1996 and 1995
______________________________________________________________________
Sales for the first nine months of this year were 28.7% lower than the same
period last year. Domestic packaging sales declined $1,625,000 or 20.0%, the
safety and automated systems division's sales declined $1,030,000, or 53.7%, and
our Brazilian subsidiary's sales declined $1,287,000 or 34.8%. The Company's
demonstrated ability to deliver product to its customers in a more timely manner
this year resulted in its major distributors' reduction of their inventory
positions below comparable periods, as Weldotron's delivery credibility
improved.
Cost of sales for the first nine months of this year was 73.5% of sales versus
64.1% of sales for the same period last year. The increase reflects both a shift
in mix toward lower margin, higher total cash contributing industrial packaging
sales, as well as generally higher fixed costs as a percentage of sales among
all business segments due to volume declines.
Selling, general and administrative expense decreased by $1,423,000 in the first
nine months of this year compared to the same period last year due to staff
reductions made in the third quarter of fiscal 1996, as well as lower operating
expenses.
The gain from foreign currency translation decreased by $94,000 for the first
nine months of this year compared to the same period last year, due to less
favorable currency exchange rates.
Other income in the first nine months this year was $52,000 lower than the first
nine months of last year due to fees associated with amendments to the Credit
Facility.
Interest expense declined $64,000 due to reduced borrowings and lower interest
rates domestically, partially offset by increased interest expense at our
Brazilian subsidiary. There was no provision for income taxes in the first nine
months this year versus $136,000 in the similar period last year. The provision
last year was due solely to taxable income from our Brazilian subsidiary of
$435,000 for the nine month period.
PART II. OTHER INFORMATION
The Company is involved in various legal actions arising in the ordinary course
of business and several claims have been asserted against the Company as of
November 30, 1996. Some of the actions involve claims for compensatory, punitive
or other damages. The Company presently believes that it has valid defense to
the claims that have been asserted and that any compensatory damage claims are
adequately covered by insurance above the Company's $100,000 per claim
self-insurance retention.
Item 2. Changes in Securities
The Company was in default of its minimum working capital and tangible net worth
covenants of the Credit Facility as of August 31, 1996 and November 30, 1996.
Subsequently, Congress Financial Corporation notified the Company of its
intention to terminate the Credit Facility due to the default as well as the
reduced size of the outstanding loan (below $1,000,000) and provided the Company
a period of time in which to seek alternative sources of financing. On December
10, 1996, the Company successfully entered into a new credit facility (the "New
Credit Facility") with Business Alliance Capital Corporation, ("BACC") to
provide a revolving line of credit for working capital purposes. The interest
rate is 3.0% over the Core States floating base rate which was 8.25% at November
30, 1996. The New Credit Facility further requires that the Company pay fees on
the average outstanding loan of 0.33% per month, for administration and upon
early termination of the New Credit Facility. The maximum line of credit is
$1,500,000 and the maturity date is December 10, 1998.
The New Credit Facility is collateralized by substantially all of the assets of
the Company and its domestic subsidiaries. Borrowings under the New Credit
Facility are limited to certain percentages of eligible inventory and accounts
receivable as well as a stipulation as to the maximum advance level on
inventory.
On August 31, 1994, the Registrant borrowed Five Hundred Thousand ($500,000)
Dollars from Lyford Corp. "Lyford", a related company that owns 19.56% of the
issued and outstanding common stock of the registrant. The Company executed and
delivered to Lyford a promissory note, a security agreement and a Common Stock
Purchase Warrant granting to Lyford the right to purchase up to 200,000 shares
of the Company's common stock at an initial exercise price of Two ($2.00)
Dollars per share, the closing price for the Company's common stock on the date
the warrant was granted. The warrant expires on August 4, 2004.
On May 5, 1995, the Registrant concluded the rolling of this note into a new
note in the amount of One Million ($1,000,000) Dollars. The new obligation is
evidenced by a certain Amended, Extended and Restated Promissory Note dated as
of March 1, 1995 (the "Restated Note"). In consideration for the new loan, the
Company executed and delivered to Lyford the Restated Note and an additional
Common Stock Purchase Warrant. The new loan is secured by a junior lien on all
of the Company's assets. The new warrant grants to Lyford the right to purchase
up to 1,000,000 shares of the Company's common stock at an initial exercise
price of One ($1.00) Dollar per share. The market price of the Company's common
stock was $.875 on the date of the warrant grant. The new warrant expires by its
terms on April 12, 2005. Although an independent appraisal has not been
obtained, the Company management considered the application of APB 14 to the
value of these warrants and believes that they are of no value at this time. The
loan transaction closed pursuant to documents dated as of March 1, 1995 and in
the case of the new Warrant, April 13, 1995. These loan documents were
contingent on the Company's obtaining the consent of its senior lender, which
consent was obtained on May 5, 1995. The new note in the amount of one million
($1,000,000) dollars was due and payable on March 31, 1996. On June 10, 1996,
the Company amended, extended and restated the promissory note from Lyford, an
affiliated company. The revised note provides borrowings of $1,000,000 at an
interest rate of 14% per annum. The maturity date of this note has been extended
to April 1, 1997.
Item 3. Defaults Upon Senior Securities
The Company was in default of its minimum working capital and tangible net worth
covenants of the Credit Facility as of August 31, 1996 and November 30, 1996.
Subsequently, Congress Financial Corporation notified the Company of its
intention to terminate the Credit Facility due to the default as well as the
reduced size of the outstanding loan (below $1,000,000) and provided the Company
a period of time in which to seek alternative sources of financing. On December
10, 1996, the Company successfully entered into a new credit facility (the "New
Credit Facility") with Business Alliance Capital Corporation, ("BACC") to
provide a revolving line of credit for working capital purposes. The interest
rate is 3.0% over the Core States floating base rate which was 8.25% at November
30, 1996. The New Credit Facility further requires that the Company pay fees on
the average outstanding loan of 0.33% per month, for administration and upon
early termination of the New Credit Facility. The maximum line of credit is
$1,500,000 and the maturity date is December 10, 1998.
The New Credit Facility is collateralized by substantially all of the assets of
the Company and its domestic subsidiaries. Borrowings under the New Credit
Facility are limited to certain percentages of eligible inventory and accounts
receivable as well as a stipulation as to the maximum advance level on
inventory.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
On October 7, 1996, the Company announced that it would apply to the Securities
and Exchange Commission to voluntarily withdraw from listing and registration on
American Stock Exchange and seek listing elsewhere. The Company's decision
resulted from the Amex's notification to the Company that it determined to
delist the Company because it no longer met the exchange's continued listing
requirements. While the Company initially appealed this decision, the Company
and the exchange agreed to settle matters by having the Company file an
application for delisting with the SEC. The Company agreed to withdraw its
appeal and the exchange agreed to withdraw its decision upon SEC approval of the
Company's application.
Item 6. Exhibits and Reports on Form 8-K
Press Release dated July 11, 1996.
<PAGE>
S I G N A T U R E
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.
WELDOTRON CORPORATION
Registrant
By: /s /Michael McKee
Michael McKee
Vice President of Finance
Date: January 14, 1997
<PAGE>
WELDOTRON CORPORATION
News Release
1532 So. Washington Avenue (at I-287)
Piscataway, New Jersey 08854 (201) 752-6700
For information, please contact:
WELDOTRON CORPORATION (AMEX: WLD)
Richard C. Hoffman, Corporate Secretary (908) 968-9640
TO: THE EDITOR
FOR: IMMEDIATE RELEASE July 11, 1996
WELDOTRON DENIES RUMORS OF ACQUISITION
Piscataway, New Jersey, July 11, 1996... Weldotron Corporation (AMEX:WLD) today
denied rumors that it has been or is about to be acquired. It has come to the
Company's attention that rumors have been circulating within the packaging
industry that Weldotron has been acquired or that its acquisition was imminent.
A spokesperson for the Company stated that the substance of these rumors was
incorrect. While Weldotron recently had been approached by a potential suitor
about the possibility of acquiring the Company or a potential business
combination, discussions did not go beyond the preliminary stage.
Weldotron is a leading manufacturer of packaging systems for general industrial
applications as well as food packaging and "Weighwrap Systems" for supermarkets
and fresh food processors. The Company also has a Communications and Control
Group which manufactures and sells industrial safety controls.
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> FEB-29-1996
<PERIOD-END> NOV-30-1996
<CASH> 59
<SECURITIES> 0
<RECEIVABLES> 1,519
<ALLOWANCES> 0
<INVENTORY> 5,828
<CURRENT-ASSETS> 7,681
<PP&E> 11,434
<DEPRECIATION> 9,601
<TOTAL-ASSETS> 10,033
<CURRENT-LIABILITIES> 7,328
<BONDS> 0
<COMMON> 118
0
0
<OTHER-SE> 611
<TOTAL-LIABILITY-AND-EQUITY> 10,033
<SALES> 3,080
<TOTAL-REVENUES> 3,080
<CGS> 2,240
<TOTAL-COSTS> 3,608
<OTHER-EXPENSES> 0
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<INTEREST-EXPENSE> 120
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</TABLE>
