FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
X QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 1994
Commission file number: 1-5731
Willcox & Gibbs, Inc.
(Exact name of registrant as
specified in its charter)
New York 13-1474527
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
150 Alhambra Circle, Coral Gables, Florida 33134
(Address of principal executive offices) (Zip Code)
(305) 446-8000
(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 ---
Indicate number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date:
<TABLE>
<CAPTION>
Date Class Shares Outstanding
<S> <C> <C>
November 4, 1994 Common Stock 24,114,138
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
WILLCOX & GIBBS, INC.
INDEX
Page Number
<S> <C> <C>
Part I - Financial Information
Condensed Consolidated Balance Sheets
(Unaudited) at September 30, 1994 and
December 31, 1993........................... 1
Condensed Consolidated Statements of
Income (Unaudited) for the Nine and
Three Months Ended September 30, 1994
and 1993..................................... 2
Condensed Consolidated Statements of
Cash Flows (Unaudited) for the Nine
Months Ended September 30, 1994 and 1993..... 3
Notes to Unaudited Condensed Consolidated
Financial Statements......................... 4
Report of Independent Accountants............ 7
Management's Discussion and Analysis
of Financial Condition and Results of
Operations................................... 8
Part II - Other Information............................ 12
</TABLE>
<PAGE>
<TABLE>
WILLCOX & GIBBS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(000's omitted, except for share amounts)
<CAPTION>
September 30, Dec. 31,
1994 1993
-------------- -----------
(UNAUDITED)
ASSETS
- - ----------
<S> <C> <C>
Current Assets
Cash and Cash Equivalents $ 44,260 $ 19,131
Accounts and Notes Receivable - Net 147,362 129,163
Inventories of Finished Goods 116,189 117,577
Income Taxes Receivable 440 1,407
Prepaid Expenses and Other Current
Assets 9,382 9,002
Deferred Income Taxes 194 1,796
-------- --------
Total Current Assets 317,827 278,076
Investments and Noncurrent Receivables 5,371 2,599
Property, Plant & Equipment - Net 53,260 52,682
Other Assets 4,733 4,350
Deferred Income Taxes 125 693
Net Assets of Discontinued Operations 0 43,337
Cost in Excess of Net Assets of Acquired
Businesses - Net 46,200 47,079
-------- --------
$427,516 $428,816
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
- - ------------------------------------
Current Liabilities
Short-Term Debt $ 0 $ 61,500
Current Installments of Long-Term Debt 16,429 9,261
Accounts and Notes Payable - Trade
and Other Liabilities 159,577 136,030
-------- --------
Total Current Liabilities 176,006 206,791
Long-Term Debt 118,215 125,975
Other Long-Term Liabilities 3,752 3,528
Stockholders' Equity
Preferred Stock (Authorized 600,000
Shares, None Issued) 0 0
Preference Stock (Authorized 2,000,000
Shares, None Issued) 0 0
Common Stock (24,705,233 Shares Issued) 24,705 21,214
Capital Surplus 81,354 53,818
Retained Earnings 28,896 21,874
Cumulative Foreign Translation Adjustment 0 (1,333)
Marketable Equity Security Adjustment (875) (625)
Treasury Stock, at Cost (591,095 Shares) (4,537) (2,426)
-------- --------
129,543 92,522
-------- --------
$427,516 $428,816
======== ========
</TABLE>
See accompanying report of independent accountants and notes
to unaudited condensed consolidated financial statements.
<PAGE>
<TABLE>
WILLCOX & GIBBS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(000's omitted, except for per share amounts)
<CAPTION>
NINE MONTHS THREE MONTHS
ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30,
--------------------- ---------------------
1994 1993 1994 1993
----- ----- ----- -----
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
Net Sales $784,895 $376,942 $275,822 $138,691
Cost of Goods Sold 628,735 300,393 222,688 110,646
-------- -------- -------- --------
Gross Profit 156,160 76,549 53,134 28,045
Selling and Administrative
Expenses 136,864 64,971 46,233 23,179
-------- -------- -------- --------
Operating Profit 19,296 11,578 6,901 4,866
-------- -------- -------- --------
Interest Expense 6,971 4,295 2,603 1,385
-------- -------- -------- --------
Other Income - Net 803 612 660 232
-------- -------- -------- --------
Income from Continuing Operations
before Income Taxes 13,128 7,895 4,958 3,713
Provision for Income Taxes 5,773 3,297 2,178 1,587
-------- -------- -------- --------
Income from Continuing Operations 7,355 4,598 2,780 2,126
Discontinued Operations, Net of
Income Taxes (327) 1,650 (934) 157
-------- -------- -------- --------
Income Before Cumulative Effect of
Change in Accounting for
Income Taxes 7,028 6,248 1,846 2,283
Cumulative Effect of Change in
Accounting for Income Taxes 0 660 0 0
-------- -------- -------- --------
Net Income $ 7,028 $ 6,908 $ 1,846 $ 2,283
======== ======== ======== ========
Income per Common Share:
Income from Continuing
Operations $0.31 $0.22 $0.11 $0.10
Discontinued Operations (0.01) 0.08 (0.03) 0.01
-------- -------- -------- --------
Income before Cumulative Effect
of Change in Accounting for
Income Taxes 0.30 0.30 0.08 0.11
Cumulative Effect of Change in
Accounting for Income Taxes -- 0.03 -- --
-------- -------- -------- --------
Net Income $0.30 $0.33 $0.08 $0.11
======== ======== ======== ========
Average Number of Common and Common
Equivalent Shares 23,650 20,949 24,318 20,949
======== ======== ======== ========
</TABLE>
See accompanying report of independent accountants and notes
to unaudited condensed consolidated financial statements.
<PAGE>
<TABLE>
WILLCOX & GIBBS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(000's omitted)
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
------------------------
1994 1993
------ ------
(UNAUDITED)
<S> <C> <C>
Net Cash Provided By (Used In) Operating Activities $26,335 $ (3,097)
-------- -------
Cash Flows From Investing Activities:
Capital Expenditures (6,417) (4,532)
Sale of Short-Term Investments 0 12,874
Cost of Acquisitions, Net of Cash Acquired 0 (12,143)
Sale of Apparel Operations 37,199 0
Other Investing Activities (813) 489
-------- -------
Net Cash Provided By (Used) In Investing Activities 29,969 (3,312)
-------- -------
Cash Flows From Financing Activities:
Net (Payments) Borrowings under Line
of Credit Arrangements (61,500) 390
Sale of Common Stock to Rexel 31,027 0
Other Debt Payments and Sundry Financing Activities (702) (2,120)
-------- -------
Net Cash Used In Financing Activities (31,175) (1,730)
-------- -------
Net Increase (Decrease) In Cash 25,129 (8,139)
Cash and Cash Equivalents at Beginning of Period 19,131 15,567
-------- -------
Cash and Cash Equivalents at End of Period $ 44,260 $ 7,428
======== =======
Supplemental Information Of Business Acquired
Fair Value of Assets Acquired $ 0 $24,018
Liabilities Assumed 0 10,145
-------- -------
Cash Paid $ 0 $13,873
======== =======
</TABLE>
See accompanying report of independent accountants and notes
to unaudited condensed consolidated financial statements.
<PAGE>
WILLCOX & GIBBS, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. The accompanying financial information should be read in conjunction with
the consolidated financial statements, including the notes thereto, for
the year ended December 31, 1993. The condensed consolidated balance
sheet as of December 31, 1993 has been summarized from the Company's
audited consolidated balance sheet as of that date.
2. Results for interim periods are not necessarily indicative of the results
to be expected for the year. The accompanying financial information
reflects all adjustments which are, in the opinion of Management,
necessary for a fair statement of the results for the periods.
3. Inventories are stated at the lower of LIFO cost or market.
4. Income per common share is computed by dividing net income by the weighted
average number of common and common equivalent shares outstanding during
the periods.
5. On April 12, 1993, the Company acquired Sacks Electrical Supply Co.
("Sacks"), a distributor of electrical supplies and components, for $13.9
million (including $0.3 million of acquisition costs).
On December 17, 1993, the Company acquired Summers Group, Inc.
("Summers"), a distributor of electrical supplies and components, for
$60.7 million in cash (including $0.7 million of acquisition costs) and a
$25 million three-year note issued to the seller, plus contingent
consideration to be determined based on defined profits of Summers,
subject to a maximum purchase price of $120 million.
These acquisitions have been recorded as purchases, and the excess of the
total purchase price over the fair value of the net assets acquired ($6.9
million for Sacks and $11.5 million for Summers) is being amortized over
40 years. Sacks' and Summers' results of operations are included in the
Company's financial statements from the respective dates of acquisition.
The following table summarizes the effect on consolidated sales and income
from continuing operations of the Company for the nine and three months
ended September 30, 1993, on an unaudited pro forma basis, assuming these
acquisitions had been consummated as of January 1, 1993 (000's omitted,
except for income per share)
<PAGE>
<TABLE>
WILLCOX & GIBBS, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(continued)
<CAPTION>
Nine Months Ended Three Months Ended
September 30, 1993 September 30, 1993
------------------- ------------------
<S> <C> <C>
Sales $712,660 $248,012
======== ========
Income from Continuing Operations $ 8,788 $ 3,354
======== ========
Income per Share from Continuing
Operations $ .42 $ .16
======== ========
</TABLE>
The pro forma results are not necessarily indicative of what actually
would have occurred if the acquisitions had been in effect at the
beginning of the period, nor are they necessarily indicative of future
consolidated results.
6. In the fourth quarter of 1993, the Company decided to sell its apparel
parts and supplies distribution business ("Apparel") and engaged an
investment banking firm, of which a director of the Company is president,
to seek a purchaser. The sale was consummated on July 13, 1994 for
consideration valued at approximately $43.7 million consisting of cash of
$38.6 million ($37.2 million net of costs), a $3 million subordinated note
from the buyer valued at $2.3 million, warrants to purchase approximately
15% of the buyer valued at $0.7 million and 324,814 shares of Willcox and
Gibbs common stock valued at $2.1 million. The net proceeds from the sale
approximated book value of the net assets sold, but resulted in a loss on
disposal of $0.7 million, net of taxes, due primarily to the recognition
of previously established deferred foreign translation adjustments. This
business is included in the Consolidated Statements of Income as
discontinued operations for all periods presented. Summarized results of
the discontinued operations (excluding the loss on disposal) are as
follows (000's omitted):
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30 September 30
------------------- -------------------
1994 1993 1994 1993
------ ------ ------ ------
<S> <C> <C> <C> <C>
Sales $40,819 $58,555 $1,978 $18,275
======= ======= ====== =======
Income (Loss) $ 345 $ 1,650 $ (262) $ 157
======= ======= ====== =======
</TABLE>
Interest expense of $1,983 and $2,969 for the nine months ended September
30, 1994 and 1993, respectively, and interest expense of $134 and $1,048
for the three months ended September 30, 1994 and 1993, respectively, have
been allocated to apparel operating results based upon net assets of the
apparel operations.
7. In connection with the resignation of an executive of the Company on March
18, 1994, the Company entered into an agreement with such executive which
provided, among other things, certain payments and acceleration of certain
other payments in connection with the executive's related employment
agreement. First quarter results for 1994 include charges of $1.7 million
($1.0 million net of tax) in connection with this agreement.
8. On March 1, 1994, the Company sold to Rexel, S.A. 3,491,280 newly issued
shares of Company common stock for a total cash purchase price of $31.4
<PAGE>
WILLCOX & GIBBS, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(continued)
million ($31.0 million net of costs), which was used to repay short-term
debt. As a result, Rexel increased its beneficial ownership of the
outstanding common stock of the Company from 30% to 40%.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
The Board of Directors of
Willcox & Gibbs, Inc.:
We have reviewed the accompanying condensed consolidated balance sheet of
Willcox & Gibbs, Inc. (the "Company") as of September 30, 1994, and the related
condensed consolidated statements of income for three-month and nine-month
periods ended September 30, 1994 and 1993 and the related condensed
consolidated statements of cash flows for the nine-month periods ended
September 30, 1994 and 1993. These financial statements are the responsibility
of the Company's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards, the objective of
which is the expression of an opinion regarding the financial statements taken
as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the accompanying financial statements for them to be in conformity
with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet as of December 31, 1993, and the
related consolidated statements of income, changes in stockholders' equity and
cash flows for the year then ended (not presented herein), and in our report
dated March 4, 1994, except as to the information presented in the last
paragraph of Note 11, for which the date is March 18, 1994, we expressed an
unqualified opinion on those consolidated financial statements. In our
opinion, the information set forth in the accompanying condensed consolidated
balance sheet as of December 31, 1993 is fairly stated, in all material
respects, in relation to the consolidated balance sheet from which it has been
derived.
Coopers & Lybrand L.L.P.
Miami, Florida
October 25, 1994
<PAGE>
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Results of Operations
Sales for the third quarter ended September 30, 1994 were $275.8
million, compared with $138.7 million for the same period a year ago. Third
quarter sales included a total of $129.7 million from Summers Group, which was
acquired by the Company in December 1993.
Income from continuing operations was $2.8 million, or $.11 per
share, for the third quarter of 1994, compared to $2.1 million, or $.10 per
share, in 1993.
Sales for the nine months ended September 30, 1994 were $784.9
million, including combined sales of $407.6 million from Summers Group and The
Sacks Group (acquired in April, 1993), compared with sales of $376.9 million
for the same period in 1993.
Income from continuing operations was $7.4 million, or $.31 per
share, for the nine months ended September 30, 1994, compared to $4.6 million,
or $.22 per share, for the same period in 1993. Excluding charges in the first
quarter of 1994 associated primarily with the resignation of an officer of the
Company totalling $1.2 million, net of tax, and $0.4 million, net of tax, of
relocation costs in the second quarter of 1994, income from continuing
operations for the first nine months of 1994 was $9.0 million, or $.38 per
share.
In July 1994, the Company completed the previously announced sale of
its apparel parts and supplies distribution businesses ("Apparel") for
consideration valued at approximately $44 million, consisting of $38.6 million
in cash ($37.2 million net of costs), approximately 325,000 shares of Willcox &
Gibbs common stock and a warrant and subordinated debt of the purchaser.
Results of Apparel are included as discontinued operations for all periods
presented. The loss from discontinued operations in the third quarter of 1994
of $0.9 million, net of tax, includes operating losses of $0.3 million, a loss
on the disposition of the assets of $0.1 million, and an after-tax charge of
$0.5 million related to the previously established deferred foreign translation
adjustments.
The Company adopted Statement of Financial Accounting Standards No.
109 "Accounting for Income Taxes" ("SFAS 109") in the first quarter of 1993.
Adoption of this statement resulted in a credit to income in the first quarter
of 1993 of $0.7 million, or $.03 per share, which is reflected in results of
operations as the cumulative effect of a change in accounting principle.
In March 1994, as more fully discussed under "Liquidity; Capital
Resources", the Company sold 3.5 million newly issued shares of common stock to
Rexel, S.A. for $31.4 million ($31.0 million net of costs). As a result of the
issuance of these shares, the average number of common and common equivalent
shares has increased to 24.3 million and 23.7 million, respectively, for the
third quarter and first nine months of 1994, compared to 20.9 million, for both
of the comparable periods of the prior year.
<PAGE>
Net income of the Company was $1.8 million, or $.08 per share, for
the third quarter of 1994, compared to net income of $2.3 million, or $.11 per
share, for the comparable period of the prior year. For the nine months ended
September 30, 1994, net income was $7.0 million, or $.30 per share, compared to
$6.9 million, or $.33 per share, for the first nine months of 1993.
The following table sets forth the percentages which certain income
and expense items bear to net sales:
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
----------------- -------------------
1994 1993 1994 1993
------ ------ ------ ------
<S> <C> <C> <C> <C>
Net Sales 100.0% 100.0% 100.0% 100.0%
====== ====== ====== =======
Gross Margin 19.9% 20.3% 19.3% 20.2%
Selling and Administrative expenses 17.4 17.2 16.8 16.7
------ ------ ------ -------
Operating Profit 2.5 3.1 2.5 3.5
Interest Expense .9 1.1 .9 1.0
Other Income .1 .1 .2 .2
------ ------ ------ -------
Income From Continuing Operations
Before Taxes 1.7% 2.1% 1.8% 2.7%
====== ====== ====== =======
</TABLE>
On a pro forma basis, assuming the Summers and Sacks acquisitions
were made on January 1, 1993, sales were up 10.0% for the nine months ended
September 30, 1994 and 10.8% for the third quarter of 1994, reflecting
improvement in the construction and industrial markets served by the Company.
While volume is up, margins have declined compared to prior years. This
decline is primarily attributable to continuing competitive pressures and the
increased percentage of total sales comprised of sales shipped direct from the
vendor to the customer, which historically have had lower margins than sales
from inventory.
Selling and administrative expenses increased $71.9 million and $23.1
million, respectively, for the nine months and quarter ended September 30,
1994, as compared to the same periods of the prior year. As a percentage of
sales, selling and administrative expenses were 17.4% and 16.8%, respectively,
for the nine months and quarter ended September 30, 1994, as compared to 17.2%
and 16.7%, respectively, for the nine months and quarter ended September 30,
1993. This increase reflected the additional operations added through the
above-mentioned acquisitions, $2.1 million of pre-tax charges in the first
quarter of 1994 associated primarily with the resignation of an officer and
$0.7 million of pre-tax charges in the second quarter in connection with the
relocation of the Company's corporate office to the Miami area.
The increase in interest expense reflects the borrowings in
connection with the Summers acquisition, offset to some extent by the paydown
of short-term debt with the funds received from the sale of shares to Rexel in
March, 1994 and the sale of Apparel in July, 1994.
As previously mentioned, the Company adopted SFAS 109 in the first
quarter of 1993. It is management's belief that the net deferred tax asset as
<PAGE>
reflected on the financial statements will be realized based upon forecasted
future pretax earnings and taxable income as well as utilization of certain
carryback opportunities.
During the first half of 1994, the Company largely completed its
restructuring program begun several years ago, and it is now engaged in only
one business segment: the distribution of electrical parts and supplies. In
addition, during the first half of 1994 the management of the Company
substantially changed, including the appointment of a new chief executive
officer. Since these changes were effected, the Company has been focusing its
efforts on integrating its operations and enhancing its asset management and
customer service. In particular, the Company is in the process of upgrading
its management information systems and implementing programs to improve its
inventory turnover. In addition, the Company has undertaken programs to
realign certain branches to enhance efficiency, to identify and close
unprofitable branches, and to reduce branch and corporate personnel. While
these efforts have resulted and will result in certain increased costs in the
near term, the Company expects that in the long run these programs will improve
its operating results and cash flows.
Liquidity; Capital Resources
The Company's working capital requirements continue to be met by
internally generated funds and short-term borrowings. Management believes
sufficient cash resources will be available to support its long-term growth
strategies through internally generated funds, credit arrangements and the
ability of the Company to obtain additional financing. However, no assurance
can be given that financing will continue to be available on attractive terms.
On March 1, 1994, the Company sold to Rexel 3,491,280 newly issued
shares of Company common stock for a total cash purchase price of $31.4 million
($31.0 million net of costs), which was used to repay short-term debt and
significantly strengthen the Company's balance sheet. As a result, Rexel's
beneficial ownership of outstanding common stock of the Company increased from
30% to 40%.
At September 30, 1994 the Company had cash of $44.3 million compared
to cash at December 31, 1993 of $19.1 million. Indebtedness for borrowed money
(including current installments and short-term debt) was $134.6 million at
September 30, 1994, compared to $196.7 million at December 31, 1993. The
increase in cash and the reduction of indebtedness reflect proceeds from the
sale of stock to Rexel in March, 1994, the sale of Apparel in July, 1994 and
cash provided from operating activities. As of September 30, 1994, there were
no borrowings outstanding under the Company's bank credit agreement and $50
million was available for future borrowings.
During the first nine months of 1994 the Company's operating
activities provided $26.3 million in cash compared to $3.1 million of cash used
in the first nine months of 1993, reflecting profitable operations and improved
asset management. Capital expenditures were $6.4 million in 1994 compared to
$4.5 million in 1993.
<PAGE>
Working capital was $141.5 million and $71.3 million at September 30,
1994 and December 31, 1993, respectively with the increase reflecting the
factors discussed above. The current ratio was 1.8 and 1.3, respectively, at
such dates.
Net worth was $129.5 million and $92.5 million at September 30, 1994
and December 31, 1993, respectively, with the increase reflecting net income
for the nine months and the sale of the shares to Rexel. The ratio of debt to
equity was 1.0 and 2.1, respectively, at such dates.
Certain key ratios are as follows:
[CAPTION]
September 30, 1994 December 31, 1993
------------------ -----------------
Days sales outstanding[FN]1 49 50
Days inventory supply[FN]2 76 84
Trade working capital
turnover[FN]3 6.8 6.2
--------------------------------------------
[FN]
1. Number of days sales represented by accounts receivable.
[FN]
2. Number of days cost of sales represented by inventory.
[FN]
3. Trade working capital equals inventory (FIFO) plus trade
accounts receivable less trade accounts payable.
<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit No. Description
11.1 Computation of net income per common and common
equivalent shares.
15.1 Awareness letter of independent accountants.
(b) Reports on Form 8-K
During the quarter ended September 30, 1994, the Company filed a
Current Report on Form 8-K, dated July 13, 1994, reporting under Items 2 and 7.
<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
undersigned thereunto duly authorized.
WILLCOX & GIBBS, INC.
Date: November 14, 1994 By: /s/ Allan Gonopolsky
--------------------------------
Allan Gonopolsky
Vice President and
Chief Accounting Officer
<PAGE>
Index to Exhibits
Exhibit No. Description
11.1 Computation of net income per common and common
equivalent shares.
15.1 Awareness letter of independent accountants.
Exhibit 11.1
[CAPTION]
WILLCOX & GIBBS, INC. AND SUBSIDIARIES
COMPUTATION OF NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE
(000's Omitted, Except Per Share Amounts)
<TABLE>
NINE MONTHS ENDED THREE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
-------------------- -------------------
1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Income Applicable To Primary Common And
Common Equivalent Shares
Income From Continuing Operations $7,355 $4,598 $2,780 $2,126
Discontinued Operations (327) 1,650 (934) 157
------- ------- ------- -------
Income Before Cumulative Effect Of
A Change In Accounting For Taxes 7,028 6,248 1,846 2,283
Cumulative Effect Of A Change In
Accounting For Taxes 0 660 0 0
------- ------- ------- -------
Net Income $7,028 $6,908 $1,846 $2,283
======= ======= ======= =======
Income Applicable To Fully Diluted
Common And Common Equivalent Shares
Income From Continuing Operations $7,355 $4,598 $2,780 $2,126
Interest Reduction, Net of Taxes,
Upon Conversion Of Convertible
Subordinated Debentures 1,470 1,496 490 499
------- ------- ------- -------
Income From Continuing Operations 8,825 6,094 3,270 2,625
Discontinued Operations (327) 1,650 (934) 157
------- ------- ------- -------
Income Before Cumulative Effect Of
A Change In Accounting For Taxes 8,498 7,744 2,336 2,782
Cumulative Effect Of A Change In
Accounting For Taxes 0 660 0 0
------- ------- ------- -------
Net Income $8,498 $8,404 $2,336 $2,782
======= ======= ======= =======
Primary Shares:
Weighted Average Number Of
Common Shares And Common
Share Equivalents Outstanding
During The Period:
Common (Net Of Treasury Shares) 23,609 20,948 24,277 20,948
Options 41 1 41 1
------- ------- ------- -------
Total 23,650 20,949 24,318 20,949
======= ======= ======= =======
<PAGE>
Exhibit 11.1
(continued)
Fully Diluted Shares:
Weighted Average Number Of
Common Shares And Common
Share Equivalents Outstanding
During The Period:
Common (Net Of Treasury Shares) 23,609 20,948 24,277 20,948
Options 41 1 41 1
Conversion Of Subordinated
Debentures 5,225 5,225 5,225 5,225
------- ------- ------- -------
Total 28,875 26,174 29,543 26,174
======= ======= ======= =======
Earnings Per Share
Primary
Income From Continuing Operations $0.31 $0.22 $0.11 $0.10
Discontinued Operations (0.01) 0.08 (0.03) 0.01
------- ------- ------- -------
Income Before Cumulative Effect
Of A Change In Accounting For
Taxes 0.30 0.30 0.08 0.11
Cumulative Effect Of A Change
In Accounting For Taxes 0.00 0.03 0.00 0.00
------- ------- ------- -------
Net Income $0.30 $0.33 $0.08 $0.11
======= ======= ======= =======
Earnings Per Share
Fully Diluted
Income From Continuing Operations $0.31 $0.24 $0.11 $0.10
Discounted Operations (0.01) 0.06 (0.03) 0.01
------- ------- ------- -------
Income Before Cumulative Effect
Of A Change In Accounting For
Taxes 0.30 0.30 0.08 0.11
Cumulative Effect Of A Change In
Accounting For Taxes 0.00 0.03 0.00 0.00
------- ------- ------- -------
Net Income $0.30 $0.33 $0.08 $0.11
======= ======= ======= =======
</TABLE>
Exhibit 15.1
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: WILLCOX & GIBBS, INC. REGISTRATION ON FORM S-8
We are aware that our report dated October 25, 1994 on our review of the
condensed consolidated balance sheet of Willcox & Gibbs, Inc. as of September
30, 1994, and the related condensed consolidated statements of income for the
three-month and nine-month periods ended September 30, 1994 and 1993 and the
condensed consolidated statements of cash flows for the nine-month periods
ended September 30, 1994 and 1993 included in the Company's Form 10-Q for the
quarter ended September 30, 1994 is incorporated by reference in Registration
Nos. 2-77570, 33-4584, 33-14148, 33-32648 and 33-54440 on Form S-8. Pursuant
to Rule 436(e) under the Securities Act of 1933, this report should not be
considered a part of such registration statements prepared or certified by us
within the meaning of Sections 7 and 11 of the Act.
Coopers & Lybrand L.L.P.
Miami, Florida
October 25, 1994
