<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 1997 Commission File Number 0-5613
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OAK HILL SPORTSWEAR CORPORATION
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(Exact name of registrant as specified in its charter)
NEW YORK 13-2625545
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(State or other jurisdiction (I.R.S Employer
of incorporation) Identification Number)
1411 BROADWAY, NEW YORK, NEW YORK 10018
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(Address of principal executive offices) (Zip Code)
(212) 789-8900
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(Registrant's telephone number, including area code)
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(Former name, former address and former fiscal year,
if changed since last report)
Indicate by checkmark 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 August 8, 1997, the registrant had 2,057,576 common stock outstanding.
Page 1
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OAK HILL SPORTSWEAR CORPORATION
INDEX
PART I - Financial Information PAGE
Unaudited financial statements:
Consolidated balance sheets -
June 30, 1997 and December 31, 1996 3
Consolidated statements of operations -
three months ended June 30, 1997 and 1996 4
Consolidated statements of operations -
six months ended June 30, 1997 and 1996 5
Consolidated statements of cash flows -
six months ended June 30, 1997 and 1996 6
Notes to consolidated financial statements 7
Management's discussion and analysis of
financial condition and results of operations 8
PART II - Other Information
Item 4. Submission of Matters to a Vote of Security Holders 9
Signatures 10
The accompanying financial statements have been prepared without audit and do
not include all footnotes and disclosures required under generally accepted
accounting principles. Management believes that the results herein reflect all
adjustments which are, in the opinion of management, necessary to fairly state
the results and current financial position of the Company for the
respective periods. All such adjustments reflected herein are of a normal,
recurring nature. It is recommended that this Report be read in conjunction with
the Company's Annual Report on Form 10-K for its year ended December 31, 1996.
Page 2
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OAK HILL SPORTSWEAR CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands except share amounts)
(Unaudited)
June 30, December 31,
1997 1996
Assets
Current assets:
Cash and cash equivalents 4,645 $ 5,314
Accounts receivable - net 11 41
Assets held for sale 885 1,428
Other current assets 74 97
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Total current assets 5,615 6,880
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5,615 6,880
======== ========
Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt $ 500 $ 500
Accounts payable 27 71
Accrued expenses 432 1,072
Accrued income taxes 148 501
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Total current liabilities 1,107 2,144
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Stockholders' equity:
Preferred stock, $1.00 par value, authorized
1,000,000 shares; -0- shares issued
Common stock, $.02 par value, authorized
12,000,000 shares; 4,869,828 shares issued 97 97
Capital in excess of par value 27,363 27,363
Retained earnings (accumulated deficit) (5,944) (5,716)
Common stock held in treasury, at cost
(2,812,252 shares) (17,008) (17,008)
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Total stockholders' equity 4,508 4,736
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$ 5,615 $ 6,880
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Page 3
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OAK HILL SPORTSWEAR CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands except per share amounts)
(Unaudited)
Three months ended
June 30,
1997 1996
Revenues $ 59 $ 82
General and administrative expenses 176 137
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Loss from continuing operations
before provision for taxes (117) (55)
Provision for taxes 4 4
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Loss from continuing operations (121) (59)
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Discontinued operations:
Loss, net -- (182)
Loss on disposal, net -- --
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-- (182)
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Net loss ($ 121) ($ 241)
======= =======
Per share data:
Loss from continuing operations ($ .06) ($ .03)
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Discontinued operations:
Loss, net -- (.09)
Loss on disposal, net -- --
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-- (.09)
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Net loss, primary and fully diluted ($ .06) ($ .12)
======= =======
Weighted average number of shares outstanding:
Primary and fully diluted 2,058 2,058
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Page 4
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OAK HILL SPORTSWEAR CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands except per share amounts)
(Unaudited)
Six months ended
June 30,
1997 1996
Revenues $ 127 $ 167
General and administrative expenses 346 273
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Loss from continuing operations
before provision for taxes (219) (106)
Provision for taxes 9 4
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Loss from continuing operations: (228) (110)
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Discontinued operations:
Loss, net -- (182)
Loss on disposal, net -- --
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-- (182)
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Net loss ($ 228) ($ 292)
======= =======
Per share data:
Loss from continuing operations ($ .11) ($ .05)
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Discontinued operations:
Loss, net -- (.09)
Loss on disposal, net -- --
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-- (.09)
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Net loss, primary and fully diluted ($ .11) ($ .14)
======= =======
Weighted average number of shares outstanding:
Primary and fully diluted 2,058 2,058
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Page 5
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OAK HILL SPORTSWEAR CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Six Months Ended
June 30,
1997 1996
Cash flows used in operating activities:
Net loss ($ 228) $(292)
Adjustments to reconcile net loss
to net cash used in operating activities:
Loss on disposal of discontinued operations 0 0
Depreciation and amortization 0 0
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(228) (292)
Changes in assets and liabilities (984) 139
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Net cash used in operating activities (1,212) (153)
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Cash flows from investing activities:
Net proceeds on disposal of disc. operations 543 0
Decrease in assets held for sale 0 18
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Net cash provided by investing activities 543 18
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Cash flows from financing activities:
Net short-term borrowings 0 0
Principal payment of long-term debt 0 0
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Net cash provided by financing activities 0 0
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Net decrease in cash (669) (135)
Cash at beginning of year 5,314 5,823
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Cash at end of period $ 4,645 $ 5,688
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Supplemental disclosures of cash flow information:
Changes in assets and liabilities:
Accounts receivable $ 30 $ 291
Inventories 0 0
Other current assets 23 37
Other assets 0 0
Accounts payable and accrued expenses (684) (189)
Accrued income taxes (353) 0
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$ (984) $ 139
======= =======
Cash paid - net during the period for:
Interest $ 13 $ 11
Income taxes (including interest thereon) 561 0
Page 6
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OAK HILL SPORTSWEAR CORPORATION
Notes to Consolidated Financial Statements
(Unaudited)
Note 1 - Consolidation
The consolidated financial statements include the accounts of the Company
and its wholly-owned subsidiary which was inactive.
Note 2 - Discontinued Operations
The sales for divisions representing discontinued operations for the three
months ended June 30, 1997 and 1996 were $40,000 and $954,000, respectively.
For the six months ended June 30, 1997 and 1996, such sales were $82,000 and
$2,118,000, respectively.
Note 3 - Earnings Per Share
In February 1997 the Financial Accounting Standards Board issued FAS 128
concerning earnings per share, which the Company plans to adopt for the full
fiscal year 1997. This Statement requires restatement of all prior period
earnings per share data; however, the Company does not believe any previously
reported earnings (loss) per share data will require material restatement as a
result of the adoption of FAS 128.
Page 7
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity and capital resources:
Working capital at June 30, 1997 amounted to $4,508,000 compared to
$4,736,000 at December 31, 1996, a decrease of $228,000 due to the net loss for
the period.
During the second quarter, the Company completed the sale of one of its
properties in Mississippi which had been carried as an asset held for sale.
The Company's management is actively pursuing the redeployment of the
Company's liquid assets. As of June 30, 1997, no commitments had been made and
no material expenditures had been incurred in connection with any such
redeployment.
Management believes that the Company's cash and cash equivalents at June
30, 1997 will be adequate to pay its payables and accrued expenses, to cover its
general and administrative expenses and to cover the potential continuing
losses, if any were not previously provided for, from discontinued operations.
Results of operations:
Revenues were lower in the second quarter and first half of 1997 compared
to comparable periods of 1996 as a result of lower consulting revenues pursuant
to the Company's agreement with a purchaser of its Sportswear Division and lower
interest income as a result of the Company's lower average cash balance during
the second quarter and first half of 1997 versus the comparable periods of 1996.
General and administrative expenses rose in the second quarter and first
half of 1997 compared to the second quarter and first half of 1996 principally
as a result of increased corporate expenses which were no longer allocated to
its discontinued operations.
Page 8
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PART II. OTHER INFORMATION
Item 4. Submission of Matters to Vote of Security Holders
(a) The Annual Meeting of the shareholders of the Company was held on June
24, 1997.
(b) At said Annual Meeting, the following persons were elected directors,
with the following number of shares voted for and withheld:
For Withheld
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Arthur L. Asch 1,770,994 64,O46
Michael A. Asch 1,770,994 64,046
Joseph Greenberger 1,770,994 64,046
Kenneth S. Roth 1,770,944 64,096
Aaron W. Weingarten 1,770,944 64,096
Page 9
<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.
OAK HILL SPORTSWEAR CORPORATION
(Registrant)
Date: August 11, 1997 By: /s/ Arthur L. Asch
------------------------------------------
Arthur L. Asch, Chairman of the Board
Date: August 11, 1997 By: /s/ Michael A. Asch
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Michael A. Asch, President and Treasurer
Page 10
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1997
<CASH> 4,645
<SECURITIES> 0
<RECEIVABLES> 11
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 5,615
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 5,615
<CURRENT-LIABILITIES> 1,107
<BONDS> 0
0
0
<COMMON> 4,508
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 5,615
<SALES> 0
<TOTAL-REVENUES> 127
<CGS> 0
<TOTAL-COSTS> 346
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (219)
<INCOME-TAX> 9
<INCOME-CONTINUING> (228)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (228)
<EPS-PRIMARY> (.11)
<EPS-DILUTED> (.11)
</TABLE>
