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FORM 10-Q/A
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended June 30, 1997
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Commission file number 33-31797
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ADAGE, INC.
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(Exchange name of registrant as specified in its charter)
Pennsylvania 04-2225121
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(State or other jurisdiction of (I.R.S. Employer Identification
Incorporation or organization) Number)
7505 Technology Drive, West Melbourne, Fl. 32904
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(Address of principal executive officers) (Zip Codes)
(407) 953-7898
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(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
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Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date of August 8, 1997.
5,032,057 shares of Common Stock, par value $ .60 per share.
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<PAGE>
Items 1 and 2 of the quarterly report on form 10-Q of Adage, Inc. (the
"Company") for the quarter and six months ended June 30, 1997 are hereby
restated and ammended in their entirety on the following pages.
2
<PAGE>
ITEM 1 - FINANCIAL STATEMENTS - continued
ADAGE, INC.
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Condensed Consolidated Statements of Income
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<TABLE>
<CAPTION>
FOR THE THREE MONTHS ENDED
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JUNE 30, 1997 JUNE 30, 1996
1997 1996
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(Unaudited) (Unaudited)
000's Omitted
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<S> <C> <C>
Income
Sales ............................. $ 13,609 $ 11,614
Investment income (loss) .......... (58) 62
Other ............................. 1
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13,551 11,677
Costs and Expenses
Cost of sales ..................... 10,125 8,554
Selling, general & administrative . 3,091 2,713
Interest .......................... 271 220
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13,487 11,487
Income from continuing
operations before income taxes .... 64 190
Provision for income taxes (benefit) 16 74
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Net income (loss) from
continuing operations ............. 48 116
Income (loss) from discontinued
operations net of taxes ........... (436) (41)
Gain (loss) on sale of discontinued
operations net of taxes .......... 98
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Net income (loss) .................. (290) 75
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Earnings Per Common Share
Continuing operations ............ .01 .02
Discontinued operations .......... (.07) (.01)
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Net Income ......................... (.06) .01
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Weighted Average Common Shares
Outstanding ....................... 5,105,166 5,129,175
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</TABLE>
See Notes to condensed consolidated financial statements.
3
<PAGE>
ITEM 1 - FINANCIAL STATEMENTS - continued
ADAGE, INC.
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Condensed Consolidated Statements of Income
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<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED
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JUNE 30, 1997 JUNE 30, 1995
1997 1996
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(Unaudited) (Unaudited)
000's Omitted
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<S> <C> <C>
Income
Sales ............................. $ 23,069 $ 23,986
Investment income (loss) .......... (14) 62
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23,055 24,048
Costs and Expenses
Cost of sales ..................... 17,157 17,589
Selling, general & administrative . 5,636 5,353
Interest .......................... 592 518
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23,385 23,460
Income (loss) from continuing
operations before income taxes .... (330) 588
Provision for income taxes (benefit) (118) 225
Net income (loss) from
continuing operations ............. (212) 363
Income (loss) from discontinued
operations net of taxes ........... (504) (86)
(Loss) on sale of business segments 98 77
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Net income (loss) .................. (618) 277
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Earnings Per Common Share
Continuing operations ............ (.04) .07
Discontinued operations .......... (.08) (.02)
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Net Income ......................... (.12) .05
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Weighted Average Common Shares
Outstanding ....................... 5,105,166 5,129,175
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</TABLE>
See Notes to condensed consolidated financial statements.
4
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITIONS - $000 Omitted
Results of Operations
As an aid to understanding the Company's operating results, the following table
shows each item from the consolidated statement of income expressed as a
percentage of net sales:
<TABLE>
<CAPTION>
Percentage of Net Sales
Quarter Ended Six Months Ended Year Ended
June 30, June 30, December 31,
1997 1996 1997 1996 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Sales 100.0% 100.0% 100.0% 100.0% 100.0%
Cost of sales 74.4% 73.7% 74.4% 73.3% 75.8%
Selling, general
administrative 22.7% 23.4% 24.4% 22.3% 20.5%
Interest expense 2.0% 1.9% 2.6% 2.2% 1.4%
Income (loss) from
continuing operations
before income taxes 0.5% 1.6% (1.4%) 2.5% (0.5%)
Net Income (Loss) from
continuing operations 0.4% 1.0% (0.9%) 1.5% (0.9%)
</TABLE>
Net Sales
Net sales for the six months ended June 30, 1997 decreased $917 compared to
sales for the same period in 1996.
In the first quarter, sales decreased $2,912 due to lower demand in the utility
sector for load management switches. Declines were also experienced in
land-mobile radio product lines. Sales increased $1,995 in the second quarter as
both areas, particularly land-mobile, rebounded.
Cost of Sales
Cost of sales as a percentage of net sales increased 1.1% to 74.4% for the six
months ended June 30, 1997 from 73.3% for six months ended June 30, 1996. This
increase is the result of higher labor and related fringe costs.
Selling, General and Administrative Expenses
Selling, general and administrative expenses consist of marketing, selling,
engineering, data processing, occupancy and financial costs. These expenses
increased to 24.4% for the six months ended June 30, 1997 compared to 22.3% for
the same period in 1996. This is the result of additional engineering expenses
in support of two strategic product initiatives.
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<PAGE>
ITEM 6. Exhibits and Reports of From 8-K
b.) Reports on Form 8-K
The Registrant was not required to file reports on Form 8K during the
quarter ended June 30, 1997.
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Pursuant to the requirements of Securities Exchange Act of 1934, the Registrant
has duly caused this report to be signed on its behalf by the undersigned there-
unto duly authorized.
ADAGE, INC.
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William P. Kelly
Chief Financial Officer and
Vice President - Finance
Date: August ____, 1997
