===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1994
------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
------------- -------------
Commission file number 1-457
-----
BULOVA CORPORATION
------------------------------------------------------
(Exact name of registrant as specified in its charter)
New York 11-1719409
- - ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
ONE BULOVA AVENUE, WOODSIDE, N.Y. 11377-7874
----------------------------------------------------
(Address of principal executive offices) (Zip Code)
(718) 204-3300
----------------------------------------------------
(Registrant's telephone number, including area code)
NOT APPLICABLE
----------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
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
--------- ---------
Class Outstanding at November 4, 1994
- - --------------------------- -------------------------------
Common stock, $5 par value 4,599,249 shares
================================================================================
Page 1
INDEX
Page No.
--------
Part I. Financial Information
Item 1. Financial Statements
Consolidated Condensed Balance Sheets-
September 30, 1994 and December 31, 1993 ...................... 3
Consolidated Condensed Statements of Operations-
Three and nine months ended September 30, 1994 and 1993 ....... 4
Consolidated Condensed Statements of Cash Flows-
Nine months ended September 30, 1994 and 1993 ................. 5
Notes to Consolidated Condensed Financial Statements ............ 6 - 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations .............................. 9 - 13
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K .......................... 13
Exhibit 27--Financial Data Schedule for nine months ended
September 30, 1994 ........................................... 15
Page 2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
--------------------
<TABLE>
<CAPTION>
Bulova Corporation and Subsidiaries
Consolidated Condensed Balance Sheets
(Amounts in thousands)
September 30, December 31,
1994 1993
---------------------------
<S> <C> <C>
Assets
------
Current assets:
Cash ......................................................... $ 4,447 $ 5,880
Accounts and notes receivable-net ............................ 52,069 54,674
Inventories .................................................. 58,649 52,109
Prepaid expenses ............................................. 782 1,131
Deferred income taxes ........................................ 9,882 10,616
---------------------------
Total current assets ...................................... 125,829 124,410
---------------------------
Property, plant and equipment-net .............................. 21,040 21,467
---------------------------
Other assets:
Deferred income taxes ........................................ 17,111 16,171
Other ........................................................ 395 393
---------------------------
Total other assets ........................................ 17,506 16,564
---------------------------
Total assets .............................................. $164,375 $162,441
===========================
Liabilities and Shareholders' Equity
------------------------------------
Current liabilities:
Current installments of long-term debt ....................... $ 841 $ 1,016
Accounts payable ............................................. 7,745 8,517
Accrued expenses ............................................. 15,811 18,361
Accrued federal and foreign income taxes ..................... 1,467 1,736
---------------------------
Total current liabilities ................................. 25,864 29,630
---------------------------
Long-term debt, less current installments ...................... 2,771 3,266
---------------------------
Other liabilities and credits:
Postretirement benefits payable .............................. 45,613 43,135
Pension benefits payable ..................................... 2,965 3,348
Other ........................................................ 5,219 2,961
---------------------------
Total other liabilities and credits ....................... 53,797 49,444
---------------------------
Debt to affiliate .............................................. 18,000 16,000
---------------------------
Shareholders' equity:
Common stock ................................................. 22,999 22,999
Additional paid-in capital ................................... 23,197 23,197
Retained earnings ............................................ 17,337 17,311
Cumulative translation adjustment ............................ 415 599
---------------------------
Total ..................................................... 63,948 64,106
Less treasury stock, at cost ................................. 5 5
---------------------------
Total shareholders' equity ................................ 63,943 64,101
---------------------------
Total liabilities and shareholders' equity ................ $164,375 $162,441
===========================
See accompanying Notes to Consolidated Condensed Financial Statements.
</TABLE>
Page 3
<TABLE>
<CAPTION>
Bulova Corporation and Subsidiaries
Consolidated Condensed Statements of Operations
(Amounts in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
1994 1993 1994 1993
------------------------------------------
<S> <C> <C> <C> <C>
Revenues:
Net Sales:
Consumer products ....................... $25,429 $27,555 $ 65,134 $ 68,537
Industrial and defense products ......... 11,236 15,684 37,276 36,821
Interest, royalties and other ............. 1,791 900 4,185 3,041
------------------------------------------
Total revenues ......................... 38,456 44,139 106,595 108,399
------------------------------------------
Expenses:
Cost of sales ............................. 25,701 31,149 73,353 76,100
Selling, general and administrative ....... 12,190 11,269 31,989 31,949
Interest:
Affiliates .............................. 404 666 980 1,751
Others .................................. 70 92 218 298
------------------------------------------
Total expenses ......................... 38,365 43,176 106,540 110,098
------------------------------------------
Income (loss) from operations ............... 91 963 55 (1,699)
Gain from asset dispositions ................ 259 3,195
------------------------------------------
Income before income (taxes) benefit ........ 91 1,222 55 1,496
Income (taxes) benefit ...................... (40) 337 (29) 227
------------------------------------------
Net income .................................. $ 51 $ 1,559 $ 26 $ 1,723
==========================================
Net income per share ........................ $ .01 $ .33 $ .01 $ .37
==========================================
See accompanying Notes to Consolidated Condensed Financial Statements.
</TABLE>
Page 4
<TABLE>
<CAPTION>
Bulova Corporation and Subsidiaries
Consolidated Condensed Statements of Cash Flows
(Amounts in thousands)
Nine Months Ended
September 30,
1994 1993
------------------------
<S> <C> <C>
Operating Activities:
Net income .................................................. $ 26 $ 1,723
Adjustments to reconcile net income to net cash provided by
operating activities ....................................... 1,201 (2,344)
Changes in assets and liabilities-net:
Receivables ................................................ 2,605 2,570
Inventories ................................................ (6,540) 2,283
Prepaid expenses ........................................... 349 1,012
Other assets ............................................... (2) 47
Accounts payable and accrued expenses ...................... (3,322) (3,407)
Accrued federal and foreign income taxes ................... (269) (2,729)
Other liabilities and credits .............................. 4,167 824
------------------------
(1,785) (21)
------------------------
Investing Activities:
Purchases of property, plant and equipment .................. (978) (801)
Proceeds from asset dispositions ............................ 5,622
------------------------
(978) 4,821
------------------------
Financing Activities:
Principal payments on debt to affiliate ..................... (14,000) (20,000)
Proceeds from debt to affiliate ............................. 16,000 16,000
Principal payments on long-term debt ........................ (3,736) (690)
Issuance of long-term debt .................................. 3,066
------------------------
1,330 (4,690)
------------------------
Net change in cash ............................................ (1,433) 110
Cash, beginning of period ..................................... 5,880 6,287
------------------------
Cash, end of period ........................................... $ 4,447 $ 6,397
========================
See accompanying Notes to Consolidated Condensed Financial Statements.
</TABLE>
Page 5
Bulova Corporation and Subsidiaries
Notes to Consolidated Condensed Financial Statements
1. See Notes to Consolidated Financial Statements in the Annual Report on
Form 10-K for the year ended December 31, 1993 filed with the Securities
and Exchange Commission on March 30, 1994.
2. There have been no changes in significant accounting policies since
December 31, 1993. In addition, certain amounts applicable to prior
periods have been reclassified to conform to classifications followed in
1994.
3. On October 4, 1994, the Company executed a letter of intent for the
potential sale of its defense manufacturing segment. The letter of intent
is subject to, among other things, the process of due diligence as well as
the buyer obtaining satisfactory financing. If the transaction is
consummated as proposed, the Company would expect to record a gain. The
Company has not adopted a formal plan to dispose of its defense segment and
intends to continue in this line of business should this transaction not be
consummated. Based on the Company's intent, as well as the significant
contingencies related to the possible sale, the Company will continue to
account for the defense segment as a component of its continuing
operations.
4. Income taxes for the quarter and nine months ended September 30, 1994 and
1993 include federal taxes paid by the Company of $325,000, $1,257,000,
$209,000 and $357,000, respectively, related to the tax allocation
agreement between the Company and its parent, Loews Corporation ("Loews").
See Note 6 of the Notes to Consolidated Financial Statements in the Annual
Report on Form 10-K for the year ended December 31, 1993.
Additionally, the Omnibus Budget Reconciliation Act of 1993, enacted in
August 1993, among other things, increased the corporate tax rate from 34%
to 35%, effective January 1, 1993. In accordance with SFAS No. 109,
"Accounting for Income Taxes," net deferred tax assets have been adjusted
for the effect of the change in tax rates in the period enacted. As a
result, the Company recorded a tax benefit in the third quarter of 1993 of
approximately $800,000, to increase its deferred tax asset.
5. Loews provided administrative and managerial services for which the Company
was charged $300,000, $250,000, $900,000 and $750,000 for the quarter and
nine months ended September 30, 1994 and 1993, respectively. This expense
is included in selling, general and administrative expenses. The cost
allocated to the Company is estimated to be the incremental cost incurred
by Loews in providing these services to the Company. If the Company
incurred these costs on a stand-alone basis, it believes the costs incurred
could aggregate between $300,000 and $425,000 for the quarter ended
September 30, 1994 and $900,000 and $1,275,000 for the nine months ended
September 30, 1994, as compared to $250,000 and $375,000, and $750,000 and
$1,125,000 for the corresponding periods of the prior year.
6. Net income per share has been computed on the basis of 4,599,000 weighted
average number of shares outstanding for the quarter and nine months ended
September 30, 1994 and 1993.
7. As discussed in Note 5 in the Notes to Consolidated Financial Statements in
the Annual Report on Form 10-K for the year ended December 31, 1993, during
the second quarter of 1993 the sale of the Company's Valley Stream, New
York property was consummated. This transaction resulted in a pre-tax and
Page 6
after-tax gain of approximately $2,907,000 and $1,890,000, respectively.
Additionally, in September of 1993 the sale of the Company's Hong Kong
property was consummated. This transaction resulted in a pre-tax and
after-tax gain of approximately $247,000 and $160,000 for the quarter and
nine months ended September 30, 1993.
8. The Company's inventories, in thousands of dollars, are comprised of the
following:
<TABLE>
<CAPTION>
September 30, December 31,
1994 1993
--------------------------
<S> <C> <C>
Watch materials, including finished parts ..... $36,947 $37,630
Industrial and defense materials (net of
progress payments of $5,670 and $9,373) ...... 18,238 11,831
Jewelry ....................................... 602 420
Precious metals................................ 424 311
Other ......................................... 2,438 1,917
---------------------
Total ........................................ $58,649 $52,109
=====================
</TABLE>
9. Bulova Technologies, Inc., a wholly owned subsidiary of the Company,
settled defense contract claims with the U.S. government. These
settlements increased revenues and pre-tax income by approximately $408,000
and $1,600,000 for the nine months ended September 30, 1994 and 1993,
respectively.
10. On July 7, 1994 the Company became aware of an environmental contaminate
which was discovered in the ground water of its former defense
manufacturing facility. Testing and evaluation of this site remains in its
preliminary stages. Based upon the information available, during the second
quarter of 1994 the Company accrued $250,000 to provide for the estimated
clean-up costs to be required. Additional testing and further evaluation
is required before a definitive cost of ultimate clean-up can be
determined. Therefore, the liability accrued by the Company in the second
quarter may require revisions in the future.
On September 14, 1994 the Company received revised cost estimates
associated with the environmental clean-up of a former watch manufacturing
facility which the Company sold on March 12, 1981. Based upon this
information, in the third quarter of 1994, the Company provided for an
additional $484,000 to record the estimated clean-up costs to be required.
The estimated environmental liability, including the additions above,
recognized in the Company's financial statements to date of $2,334,000
represents the minimum of the Company's estimated range in equally likely
outcomes; the upper limit of that range is approximately $2,834,000.
11. For the quarter and nine months ended September 30, 1994, the Company
adjusted the gross margin related to certain defense contracts which
increased income before taxes by $800,000 and $2,420,000, respectively. Of
this adjustment, $1,200,000 related to contracts awarded in 1993 but not
substantially completed until the second quarter of 1994. These contracts
Page 7
required the production and delivery of products with which the Company had
limited experience. The Company also recognized that its production
efficiencies during the nine months ended September 30, 1994 were better
than originally estimated and adjusted its gross margin accordingly. The
remaining adjustment resulted from the award of additional foreign
contracts which had the effect of lowering unit production costs.
12. As discussed in Note 2 in the Notes to Consolidated Financial Statements in
the Annual Report on Form 10-K for the year ended December 31, 1993, during
the second quarter of 1993 the Company's industrial and defense segment
provided for an additional reserve of $500,000 in relation to a claim of
an allegedly defective product delivered prior to 1992. As of December 31,
1993, the Company had satisfied all outstanding obligations related to this
claim.
13. In the opinion of Management, the accompanying consolidated condensed
financial statements reflect all adjustments (consisting of only normal
recurring accruals) necessary to present fairly the financial position as
of September 30, 1994 and December 31, 1993 and the results of operations
for the three and nine months and the changes in cash flows for the nine
months ended September 30, 1994 and 1993, respectively.
Results of operations for the third quarter and first nine months of each
of the years is not necessarily indicative of results of operations for
that entire year.
Page 8
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
- - -------------------------------------------------------------------------------
Liquidity and Capital Resources:
Cash Flow
The Company continues to be adversely impacted by difficult business
conditions in its two lines of business: consumer products and industrial
defense products. Competition and oversupply of watch and clock products
continues to adversely affect the Company's consumer products segment. The
Company's industrial and defense products continues to be adversely impacted by
a reduction in U.S. government defense spending. The Company's efforts to
obtain commercial contracts to replace defense contracts remain in the
development stages and are not expected to contribute significantly in 1994.
For a number of years the Company has relied on Loews Corporation ("Loews"),
which owns approximately 97% of the Company's common stock, to meet working
capital needs which the Company has not been able to meet through internally
generated funds. Currently, these needs are met through a credit agreement with
Loews (the "Credit Agreement") which provides for unsecured loans from time to
time, in amounts aggregating up to $50,000,000. The Credit Agreement initially
expired in 1980, but the expiration date has been periodically extended by the
Company and Loews. The Credit Agreement currently expires June 30, 1996.
At September 30, 1994 loans aggregating $18,000,000 were outstanding under the
Credit Agreement, compared to $16,000,000 at December 31, 1993. At October 31,
1994, the outstanding balance was $16,000,000.
The increase in borrowing during the first nine months of 1994 is primarily
due to the normal cyclical inventory purchases of the Company's consumer
products segment, partially offset by collection of accounts receivable. See
detail discussion below on cash flow from operations.
It is likely that the Company from time to time will require additional
borrowings from Loews to meet its working capital needs, including normal
inventory purchases. While Loews has no obligation to enter into or maintain
arrangements for any further borrowing, the Company anticipates that its
additional working capital needs will be provided by Loews under the Credit
Agreement.
Cash Flow From Operations
The Company utilized net cash from operations of approximately $1,785,000 for
the nine months ended September 30, 1994, compared to $21,000 for the
corresponding period of the prior year.
The decrease in cash flows is due to the increase in inventory of $1,610,000
resulting from purchases to meet the cyclical demands of the holiday selling
season and a reduction in accounts payable, accrued expenses and accrued federal
income tax from period to period of $4,239,000 resulting from the timing of the
transactions, partially offset by a reduction in accounts receivable of
$4,758,000.
Cash Flow From Investing Activities
Investing activities for the nine months ended September 30, 1993 include net
proceeds from the sales of the Company's former defense manufacturing and Hong
Page 9
Kong properties of $5,622,000. In 1994, the Company did not receive any
proceeds from the disposal of assets. The Company does not anticipate any
material capital expenditures in 1994. See Note 7 to Consolidated Condensed
Financial Statements.
Cash Flow From Financing Activities
During the first quarter of 1994 the Company's industrial and defense segment
refinanced its existing industrial development revenue bonds with a bank
mortgage note. See Notes 4 and 12 to Consolidated Financial statements of the
Annual Report on Form 10-K for the year ended December 31, 1993.
Contingencies
During the second quarter of 1994 the Company provided for a liability of
$250,000 in relation to an environmental liability which the Company became
aware of in July 1994 at its former Valley Stream, N.Y. defense manufacturing
facility. Additionally, in the third quarter of 1994 the Company received
revised cost estimates associated with the environmental clean-up of a former
Sag Harbor, N.Y. watch manufacturing facility which the Company sold on March
12, 1981. The impact of the environmental clean-up will directly effect cash
flow, and it is expected that the utilization of cash will be funded by the
Credit Agreement with Loews. Based on the revised cost estimate, the Company
provided an additional liability of $484,000. See Note 9 of the Notes to
Consolidated Condensed Financial Statements.
Results of Operations:
For the quarter and nine months ended September 30, 1994 revenues decreased by
$5,683,000, or 12.9% and $1,804,000, or 1.7%, respectively, and income before
income taxes decreased by $1,131,000 and $1,441,000 compared to the
corresponding periods of the prior year.
Consumer Products
For the quarter and nine months ended September 30, 1994 watch, clock and
jewelry revenue decreased by $2,126,000, or 7.7%, and $3,403,000, or 5.0%,
respectively, income before taxes decreased by $725,000 and $2,145,000 as
compared to the corresponding periods of the prior year. The primary reason for
the decrease in income before income taxes is the $3,195,000 gain from disposal
of a former defense manufacturing facility and Hong Kong property which was
recognized in the second and third quarter of 1993. Additionally, the Company
provided $484,000 and $734,000 for environmental clean-up in the quarter and
nine months ended September 30, 1994, respectively.
For the quarter ended September 30, 1994 revenues from product sales decreased
due to a decrease in unit sales, primarily direct sales of the Benetton line,
the licensing agreement which expired in June 1994, partially offset by a higher
average unit selling price representing approximately $488,000 or 1.8%.
For the nine months ended September 30, 1994, the revenue decrease is due to a
decrease in unit sales, partially offset by an increase in the average unit
selling price representing approximately $281,000 or .4%. The segment's sales
volume decreased 5.4% compared to the corresponding period of the prior year.
The primary reason for this decrease is a 21.7% sales volume decrease at the
Company's Canadian operation. In addition, direct sales of the Company's
Benetton line have decreased 86.7% as compared to the corresponding period of
the prior year as discussed above. The Benetton line is not expected to
significantly contribute to operations for the fourth quarter of 1994.
Page 10
Cost of sales as a percentage of sales decreased 1.0% and 1.1% compared to the
quarter and nine months ended September 30, 1993, respectively. The primary
reason for the decreases is a change in the product sales mix and effective
procurement practices implemented by the Company. Selling, general and
administrative costs as a percentage of sales are relatively flat as compared to
the quarter and nine months ended September 30, 1993.
The Company recognized $1,389,000, $471,000, $3,094,000 and $2,769,000 in
royalty income for the quarter and nine months ended September 30, 1994 and
1993, respectively, which includes $780,000, $507,000, $1,407,000 and $1,889,000
of royalties under the "Benetton by Bulova" license agreement for the quarter
and nine months ended September 30, 1994 and 1993, respectively. The license
agreement with Benetton expired June 30, 1994. However, royalties will continue
to be received by the Company up until the end of fiscal 1994. The impact of
losing the Benetton agreement will directly impact this segment's revenues,
income and cash flow. The remaining royalty income represents payments by two
affiliated licensees in Europe and Far East.
The Company imports most of its watch and clock products. Foreign currency
fluctuations therefore can have a material impact on the Company's operations.
Approximately 25% of the Company's purchases are denominated in Japanese yen.
As a result of hedging practices adopted by the Company, foreign currency
fluctuations have not had a material impact on the results of operations for the
quarter and nine months ended September 30, 1994 and 1993, respectively. Future
fluctuations however, could negatively impact gross profit, income and cash
flow.
Industrial and Defense Products
Industrial and Defense revenues decreased by $4,448,000, or 28.4%, and
increased by $455,000, or 1.2%, for the quarter and nine months ended September
30, 1994, respectively, compared to the corresponding period of the prior year.
Net sales and income before taxes include $408,000 of revenues from favorable
settlement of contract claims with the U.S. government for the nine months ended
September 30, 1994, as compared to $1,600,000 in the corresponding period of the
prior year. These claims represent payment for work performed in earlier years
which had not been billed. As of September 30, 1994, the Company estimates that
there is approximately $4,000,000 of settlement claims outstanding with defense
prime contractors. The Company, however, is unable to predict the outcome of
these claims, and therefore revenue is recognized when claim proceeds are
received.
Before giving effect to the claim settlements discussed above, net sales for
the nine months ended September 30, 1994 increased $1,647,000 compared to the
corresponding period for the prior year. The primary reason for the increased
sales is a reduction in the billing backlog specifically related to shipments to
the U.S. government of the M-762 fuze. The Company continues to expect,
however, that 1994 sales will not improve significantly over the prior year
primarily due to the decline of U.S. government defense spending. Through the
nine months ended September 30, 1994 commercial contract business represents 20%
of this segment's sales. During 1993, commercial contracts accounted for 16% of
the segment sales. The commercial contract business carries a lower profit
margin than defense business, therefore, increased commercial sales are not
expected to replace the lost margins associated with the decline in defense
sales.
During the third quarter of 1994 the Company adjusted its gross margin related
to its industrial and defense contacts which increased income for the quarter
and nine months ended September 30, 1994, by $800,000 and $2,420,000,
respectively, due to the award of additional U.S. government and foreign
Page 11
military contracts which had the effect of increasing contract revenues and
lowering unit productions costs.
During the second quarter of 1993 the Company's industrial and defense
segment provided for an additional reserve of $500,000 in relation to a claim
of an allegedly defective product delivered prior to 1992. As of December 31,
1993, the Company had satisfied all outstanding obligations related to this
claim.
Income before taxes, exclusive of the claim settlements, decreased by $406,000
and increased by $1,896,000 as compared to the quarter and nine months ended
September 30, 1993. The Company expects that competition for both defense and
commercial business will remain intense. It is likely therefore that contract
pricing will be reduced, influencing profit margins, income and cash flow.
Corporate
Related parties - The charge for administrative and managerial services
provided by Loews increased by $50,000 and $150,000 for the quarter and nine
months ended September 30, 1994, respectively, as compared to the corresponding
period of the prior year. See Note 4 to consolidated condensed financial
statements.
Interest expenses and income - For the quarter and nine months ended September
30, 1994 interest expense decreased by $284,000 and $851,000 due to the
$7,000,000 decrease in borrowing to Loews under the Credit Agreement. Interest
and other income was higher for the nine months ended September 30, 1994
compared to the corresponding period of the prior year primarily resulting from
custom refunds received.
Contingencies - On July 7, 1994 the Company became aware of an environmental
contaminate which was discovered in the groundwater of its former defense
manufacturing facility. Testing and evaluation of this site is in its
preliminary stages. Based on the information available, during the second
quarter of 1994 the Company accrued $250,000 to provide for the clean-up expense
estimated to be required. Additional testing and further evaluation is required
before a definitive cost of ultimate clean-up can be determined. Therefore, the
liability accrued by the Company in the second quarter may require revisions in
the future.
On September 14, 1994 the Company received revised cost estimates associated
with the environmental clean-up of its former watch manufacturing facility which
the company sold on March 12, 1981. Based upon this information, in the third
quarter of 1994, the Company provided for an additional $484,000 to record the
clean-up expenses expected to be required.
The environmental liability recognized in the Company's financial statements
to date of $2,334,000 represents the minimum of the Company's estimated range of
equally likely outcomes; the upper limit of that range is approximately
$2,834,000.
Other
On October 4, 1994, the Company executed a letter of intent for the potential
sale of its defense manufacturing segment. The letter of intent is subject to,
among other things, the process of due diligence as well as the buyer obtaining
satisfactory financing. If the transaction is consummated as proposed, the
Company would expect to record a gain. The Company has not adopted a formal
plan to dispose of its defense segment and intends to continue in this line of
business should this transaction not be consummated. Based on the Company's
intent, as well as the significant contingencies related to the possible sale,
Page 12
the Company will continue to account for the defense segment as a component of
its continuing operations.
Item 6. Exhibits and Reports on Form 8-K
- - ----------------------------------------
(a) Exhibits -- (27) Financial Data Schedule for the nine months ended
September 30, 1994.
b) Current reports on Form 8-K -- There were no reports on Form 8-K filed for
the three months ended September 30, 1994.
Page 13
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.
BULOVA CORPORATION
-------------------
(Registrant)
Dated: November 14, 1994 By: Paul S. Sayegh
----------------------
PAUL S. SAYEGH
Chief Operating
Officer (Duly
authorized officer and
principal financial
officer)
Page 14
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> SEP-30-1994
<CASH> 4,447
<SECURITIES> 0
<RECEIVABLES> 55,472
<ALLOWANCES> 3,403
<INVENTORY> 58,649
<CURRENT-ASSETS> 125,829
<PP&E> 47,315
<DEPRECIATION> 26,275
<TOTAL-ASSETS> 164,375
<CURRENT-LIABILITIES> 25,864
<BONDS> 2,771
<COMMON> 22,999
0
0
<OTHER-SE> 40,944
<TOTAL-LIABILITY-AND-EQUITY> 164,375
<SALES> 102,410
<TOTAL-REVENUES> 106,595
<CGS> 73,353
<TOTAL-COSTS> 73,353
<OTHER-EXPENSES> 31,095
<LOSS-PROVISION> 894
<INTEREST-EXPENSE> 1,198
<INCOME-PRETAX> 55
<INCOME-TAX> 29
<INCOME-CONTINUING> 26
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 26
<EPS-PRIMARY> 0.01
<EPS-DILUTED> 0
</TABLE>
