<PAGE>
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A-2
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: October 9, 1996
ROBOTIC VISION SYSTEMS, INC.
(Exact name of Registrant as specified in charter)
Delaware 0-8623 11-2400145
(State or other (Commission File No.) (IRS Employer
jurisdiction of Identification
incorporation) Number)
425 Rabro Drive East, Hauppauge, New York 11788
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (516) 273-9700
================================================================================
<PAGE>
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of SEP.
(i) Report of Deloitte & Touche LLP, Independent Auditors;
(ii) Consolidated Balance Sheets of SEP as of March 31, 1996
and 1995 and (unaudited) as of September 30, 1996;
(iii) Consolidated Statements of Operations and Retained
Earnings of SEP for the years ended March 31, 1996 and
1995 and (unaudited) for the six months ended September
30, 1996 and 1995;
(iv) Consolidated Statements of Cash Flows of SEP for the
years ended March 31, 1996 and 1995 and (unaudited) for
the six months ended September 30, 1996 and 1995; and
(v) Notes to Financial Statements of SEP.
(b) Pro Forma Financial Information.
(i) Unaudited Condensed Combined Summary of Pro Forma
Statements of Operations for the years ended September
30, 1996, 1995 and 1994;
(ii) Unaudited Pro Forma Condensed Combined Balance Sheet as
of September 30, 1996;
(iii) Unaudited Pro Forma Condensed Combined Statements of
Operations for the Years Ended September 30, 1996, 1995
and 1994; and
(iv) Notes to Unaudited Pro Forma Condensed Combined
Financial Information.
(c) Exhibits.
(i) Agreement and Plan of Merger and Reorga-nization dated
as of October 1, 1996 by and among Robotic Vision
Systems, Inc., RVSI Fourth Acquisition Corp., Systema-
tion Engineered Products, Inc., Phillip Koerper, Merlin
Behnke, Alvira Nemetz and Michael Neleson(1)
- ----------------
(1) Heretofore filed.
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors of
Systemation Engineered Products, Inc.:
We have audited the accompanying consolidated balance sheets of Systemation
Engineered Products, Inc. and subsidiary (the "Company") as of March 31, 1996
and 1995, and the related consolidated statements of operations and retained
earnings and cash flows for the years then ended. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of the Company at March 31, 1996 and
1995, and the results of its operations and their cash flows for the years
then ended in conformity with generally accepted accounting principles.
/s/ Deloitte & Touche LLP
November 27, 1996
<PAGE>
SYSTEMATION ENGINEERED PRODUCTS, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, March 31, March 31,
1996 1996 1995
----------- ----------- ----------
(unaudited)
<S> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents (Note 1) $ 216,615 $ 90,186 $ 73,471
Receivables 6,626,868 5,931,921 3,450,206
Inventories ( Note 2) 6,137,000 8,897,531 4,653,163
Deferred income taxes (Note 8) 1,910,781 896,354 362,316
Prepaid expenses and other 663,589 42,458 72,512
----------- ----------- ----------
Total current assets 15,554,853 15,858,450 8,611,668
PLANT AND EQUIPMENT - NET (Notes 1 and 3) 1,285,392 1,384,481 966,654
OTHER ASSETS 158,324 337,455 119,906
----------- ----------- ----------
TOTAL $16,998,569 $17,580,386 $9,698,228
=========== =========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 1,885,179 $ 2,601,236 $1,027,607
Notes payable (Note 5) 6,400,000 3,465,000 900,000
Capital lease obligations (Note 7) 99,351 93,502 22,208
Accrued expenses and other current liabilities (Note 4) 4,292,707 3,944,611 1,782,325
Current portion of long term debt (Note 6) 980,794 158,238 322,154
Deferred revenue 805,906 874,643 786,965
----------- ----------- ----------
Total current liabilities 14,463,937 11,137,230 4,841,259
LONG-TERM DEBT, Less current portion (Note 6) - 1,050,252 1,178,203
CAPITAL LEASE OBLIGATIONS, Less current portion (Note 7) 249,702 286,214 68,229
DEFERRED INCOME TAXES (Note 8) 57,019 48,595 31,257
----------- ----------- ----------
Total liabilities 14,770,658 12,522,291 6,118,948
STOCKHOLDERS' EQUITY:
Common stock, $1 par value; shares authorized, 20,000;
shares issued, 8,500 as of September 30, 1996, and March 31,
1996 and 1995, respectively 8,500 8,500 8,500
Additional paid-in capital 8,500 8,500 8,500
Retained earnings 2,579,193 5,409,377 3,930,562
----------- ----------- ----------
2,596,193 5,426,377 3,947,562
Less treasury stock, 3,658 shares at cost 368,282 368,282 368,282
----------- ----------- ----------
Total stockholders' equity 2,227,911 5,058,095 3,579,280
----------- ----------- ----------
TOTAL $16,998,569 $17,580,386 $9,698,228
=========== =========== ==========
</TABLE>
See notes to consolidated financial statements.
<PAGE>
SYSTEMATION ENGINEERED PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended Year Ended
September 30, March 31,
------------------------------ ------------------------------
1996 1995 1996 1995
---- ---- ---- ----
(Unaudited)
<S> <C> <C> <C> <C>
REVENUES (Note 1) $16,208,276 $13,004,767 $29,328,168 $17,530,429
COST OF REVENUES 13,533,041 7,373,691 17,308,140 10,119,541
----------- ----------- ----------- -----------
GROSS PROFIT 2,675,235 5,631,076 12,020,028 7,410,888
COSTS AND EXPENSES:
Research and development costs 1,778,116 822,267 2,770,852 1,210,209
Selling, general and administrative expenses 3,944,049 3,339,944 6,936,377 4,321,110
Merger expenses (Note 14) 670,000 - - -
Interest expense 316,545 155,253 340,172 187,129
Interest income (141) (23,524) (49,047) (1,417)
----------- ----------- ----------- -----------
INCOME (LOSS) BEFORE INCOME TAXES (4,033,334) 1,337,136 2,021,674 1,693,857
INCOME TAX BENEFIT (PROVISION)(Note 8) 1,203,150 (416,704) (542,859) (228,037)
----------- ----------- ----------- -----------
NET INCOME (LOSS) (2,830,184) 920,432 1,478,815 1,465,820
RETAINED EARNINGS:
BALANCE, BEGINNING OF PERIOD 5,409,377 3,930,562 3,930,562 2,464,742
----------- ----------- ----------- -----------
BALANCE, END OF PERIOD $ 2,579,193 $ 4,850,994 $ 5,409,377 $ 3,930,562
=========== =========== =========== ===========
</TABLE>
See notes to consolidated financial statements.
<PAGE>
CONSOLIDATED STATEMENTS OF CASH FLOWS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six months ended Year Ended
September 30, March 31,
-------------------------- --------------------------
1996 1995 1996 1995
---------- ---------- ---------- ----------
(unaudited)
<S> <C> <C> <C> <C>
OPERATING ACTIVITIES:
Net income (loss) $(2,830,184) $ 920,432 $1,478,815 $1,465,820
Adjustments to reconcile net income to net cash (used in)
provided by operating activities:
Deferred income taxes (1,006,003) (345,594) (516,700) (47,059)
Depreciation and amortization 160,910 97,904 325,235 203,048
Loss on sale of equipment (11,446) 2,170 2,227 5,298
Changes in assets and liabilities:
Receivables (694,947) (1,397,389) (2,481,715) (604,027)
Inventories 2,760,531 (2,208,233) (4,244,368) (1,302,391)
Prepaid expenses and other current assets (621,131) 35,786 30,054 291
Other assets 80,932 (86,850) (72,228) (1,285)
Accounts payable (716,057) 751,553 1,573,629 38,940
Accrued expenses and other current liabilities 348,096 1,719,931 2,162,286 416,707
Deferred revenue (68,737) (567,223) 87,678 303,166
---------- ---------- ---------- ----------
Net cash (used in) provided by operating activities (2,598,036) (1,077,513) (1,655,087) 478,508
---------- ---------- ---------- ----------
INVESTING ACTIVITIES:
Purchases of plant and equipment (130,529) (196,204) (415,844) (582,163)
Proceeds from sales of equipment 80,154 10,300 15,663
Increase in cash surrender value of life insurance (7,876) - (145,321) (71,172)
---------- ---------- ---------- ----------
Net cash used in investing activities (58,251) (185,904) (545,502) (653,335)
---------- ---------- ---------- ----------
FINANCING ACTIVITIES:
Net borrowings on line of credit 2,935,000 1,362,000 2,565,000 (75,000)
Proceeds from issuance of long-term obligations and
other borrowings 106,075 26,000 26,000 867,429
Payment of long-term obligations (227,696) (157,103) (317,867) (659,710)
Payment of capital lease obligations (30,663) (10,951) (55,827)
---------- ---------- ---------- ----------
Net cash provided by financing activities 2,782,716 1,219,946 2,217,304 132,719
---------- ---------- ---------- ----------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 126,429 (43,471) 16,715 (42,108)
CASH AND CASH EQUIVALENTS:
Beginning of period 90,186 73,471 73,471 115,579
---------- ---------- ---------- ----------
End of period $ 216,615 $ 30,000 $ 90,186 $ 73,471
========== ========== ========== ==========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest $ 506,762 $ 161,356 $ 353,545 $ 166,917
Income taxes - 273,466 439,627 366,881
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING
ACTIVITIES:
Property and equipment acquired under capital leases - 345,108 345,108 89,235
</TABLE>
See notes to consolidated financial statements.
<PAGE>
SYSTEMATION ENGINEERED PRODUCTS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 1996 AND 1995
- --------------------------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Systemation Engineered Products, Inc. (the "Company") designs and
manufactures specialized high speed production machinery for the electronic
component industry for distribution worldwide. The Company's principal
product lines include tape and reel packaging equipment and automatic optical
inspection systems.
Principles of Consolidation - The consolidated financial statements include
the accounts of the Company and its wholly-owned subsidiary, Systemation
Exco, Ltd. ("EXCO"). All significant intercompany items and transactions
have been eliminated in consolidation.
Cash Equivalents - The Company considers all temporary investments purchased
with maturities of three months or less to be cash equivalents.
Account Receivable - Management believes that potential uncollectible amounts
are insignificant, and therefore no allowance is provided.
Inventories - Inventories are stated at the lower of cost or market, with
cost determined on an average cost basis.
Plant and Equipment - Plant and equipment assets are recorded at cost.
Depreciation is provided using the straight-line method over the estimated
useful lives ranging from three to ten years for reporting purposes.
Accelerated methods are used for income tax purposes. Provision is made for
deferred income taxes applicable to the difference in depreciation charges.
Other Assets - Other assets consist primarily of cash surrender value of life
insurance on key officers.
Revenue Recognition - The Company recognizes revenue upon shipment of
products. Warranty costs associated with products sold with warranty
protection, as well as other vender obligations and post-contract support
obligations, are estimated based on the Company's historical experience and
recorded in the period the product is sold.
Research and Development Costs - The company charges research and development
costs for Company-funded projects to operations as incurred. Research and
development costs for which are reimbursable under customer-funded contracts
are treated as contract costs.
Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
Fair Value of Financial Instruments - The following methods and assumptions
were used to estimate the fair value of each class of financial instruments:
Cash and cash equivalents, accounts receivable and accounts payable
--------------------------------------------------------------------
- The carrying amounts approximate fair value because of the short
maturity of these instruments.
Debt - The carrying amounts approximate fair value based on borrowing
----
rates currently available to the Company for bank loans with similar
terms.
Unaudited interim financial statements - In the opinion of management, the
unaudited consolidated financial statements for the six months ended
September 30, 1996 and 1995 are presented on a basis consistent with the
audited consolidated financial statements and reflect all adjustments,
consisting of only normal recurring adjustments, necessary for a fair
presentation of the results thereof. However, during the six months ended
September 30, 1996, the Company became aware of a significant problem with
the performance of one of its products. The Company believes it has resolved
this problem and is in the process of implementing necessary design changes.
As a result, the Company recorded inventory, warranty and receivable reserves
of approximately $2.9 million relating to the correction of this problem.
Additionally, deferred tax assets increased by approximately $1,014,000 from
March 31, 1996 to September 30, 1996 primarily due to temporary differences
relating to these reserves. The results of operations for interim periods are
not necessarily indicative of the results to be expected for the entire year.
<PAGE>
2. INVENTORIES
Inventories at March 31, 1996 and 1995 consisted of the following:
1996 1995
Raw materials $2,841,026 $1,379,654
Work in progress 6,009,335 2,994,992
Finished goods 47,170 278,517
---------- ----------
Total inventories $8,897,531 $4,653,163
========== ==========
3. PLANT AND EQUIPMENT
Plant and equipment at March 31, 1996 and 1995 consisted of the following:
1996 1995
Furniture and fixtures $853,194 $987,732
Machinery and equipment 789,876 611,616
Computer equipment 772,491 315,659
Leasehold improvements 173,059 167,150
Vehicles 119,397 127,374
---------- ----------
Total 2,708,017 2,209,531
Less: Accumulated depreciation (1,323,536) (1,242,877)
---------- ----------
Plant and equipment - net $1,384,481 $966,654
========== ==========
4. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Accrued expenses and other current liabilities at March 31, 1996 and 1995
consisted of the following:
1996 1995
Accrued wages and related employee benefits $1,844,223 $1,064,206
Accrued sales commissions 780,687 533,732
Accrued income taxes 837,603 87,878
Accrued warranty and other product related costs 250,000
Other 232,098 96,509
---------- ----------
$3,944,611 $1,782,325
========== ==========
<PAGE>
5. NOTES PAYABLE
The Company has two line of credit agreements with a bank. The first line,
in the amount of $3,250,000 ($1,500,000 as of March 31, 1995), bears interest
at the prime rate (8.25% as of March 31, 1996) plus 0.75% for the first
$1,500,000 of the loan amount and increases to 1.0% over the prime rate on
the balance above $1,500,000. The line is payable on demand. Amounts
outstanding on the line were $3,250,000 and $900,000 as of March 31, 1996 and
1995, respectively.
The Company had $215,000 outstanding on a second $3,000,000 line of credit as
of March 31, 1996. Borrowings under the agreement bear interest at 1.25% over
the prime rate. The agreement expires in September, 1996.
6. LONG-TERM DEBT
Long-term debt consisted of the
following:
1996 1995
Bank note due in amounts of $25,000 per
month, including interest at 1.25%
over prime rate. A balloon payment of
unpaid principle and interest is due $ 933,398 $1,127,792
July 30, 1996
Unsecured loan payable to Officer
due in amounts of $1,800 per month
plus interest at 9.0% with a balloon
payment of the unpaid priciple and
interest in April 1996. 78,488 100,088
Installment note, due in amounts of
$3,822 per month through November, 25,748 70,905
1996 including interest at 9.0%.
Equipment notes (5) due in amounts of
$350 to $3,175 per month at rates from
7.75% to 10% with maturities through 170,856 201,572
September 1999. ---------- ----------
Total long-term debt 1,208,490 1,500,357
Less current portion (158,238) (322,154)
---------- ----------
Long-term debt, net of $1,050,252 $1,178,203
current portion ========== ==========
Certain notes contain affirmative and negative covenants. As of March 31,
1996 and 1995, the Company was not in compliance with certain covenants
related to payment of shareholder bonuses and maximum capital expenditures.
The Company has obtained a waiver for the covenants violated.
Substantially all the assets of the Company are pledged as collateral under
various debt agreements.
<PAGE>
Scheduled principal payments on outstanding long-term debt, for the four years
subsequent to March 31, 1996 are as follows:
Year Ending
March 31,
1997 $1,050,251
1998 87,032
1999 51,882
2000 19,325
----------
$1,208,490
==========
7. LEASES
The Company leases vehicles and equipment under noncancellable capital lease
agreements. Plant and equipment includes the following amounts related to
capital leases:
1996 1995
Machinery and equipment $ 407,888 $62,780
Vehicles 26,455 45,355
Less accumulated depreciation (20,510) (16,158)
--------- -------
Net book value of capital leases $ 413,833 $91,977
========= =======
Scheduled annual minimum lease payments on the capital leases are as follows:
Year ending
March 31,
1997 $136,977
1998 135,552
1999 96,912
2000 91,311
2001 58,907
--------
Total future minimum lease payments 519,659
Less amounts representing interest 139,943
--------
Present value of future minimum lease payments 379,716
Less current portion 93,502
--------
$286,214
========
<PAGE>
The Company also leases certain buildings, equipment and vehicles under
noncancellable operating leases having terms of more than one year. Aggregate
commitments under operating leases were approximately $185,382 at March 31, 1996
and payable as follows:
Year Ending
March 31,
1997 $149,083
1998 23,096
1999 8,366
2000 4,837
--------
$185,382
========
Rent expense was approximately $227,767 and $230,588 in 1996 and 1995,
respectively.
The Company leases machines to a small number of customers on a month-to-month
basis. The Company also entered into one full service operating lease expiring
in October, 1996. At March 31, 1996, the total minimum future rentals to be
received, excluding contingent rentals, and month-to-month leases from
noncancelable leases is $47,600 for the year ending March 31, 1997. Rental
income was approximately $193,800 and $108,450 for the years ended March 31,
1996 and 1995, respectively and is included in revenues in the consolidated
Statements of operations and retained earnings.
8. INCOME TAXES
The provision (benefit) for income taxes consists of the following:
1996 1995
Currently payable:
Federal $ 944,749 $ 242,606
State 114,810 32,490
Deferred (516,700) (47,059)
--------- ---------
$ 542,859 $ 228,037
========= =========
A reconciliation between the income tax at the statutory U.S. Federal income tax
rate and the Company's provision (benefit) for income taxes for the years ended
March 31, 1996 and 1995 is as follows:
1996 1995
U.S. Federal statutory rate $687,000 $576,000
Increases (reductions) due to:
State taxes - net of Federal tax benefit 75,000 22,000
Tax effect of foreign sales corporation commissions (167,000) (140,000)
Research credit carryforwards (129,000) (160,000)
Other 76,859 (69,963)
-------- --------
Total $542,859 $228,037
======== ========
<PAGE>
The net deferred tax asset at March 31, 1996 and 1995 is comprised of the
following:
Current deferred tax assets: 1996 1995
Accrued liabilities $491,800 $ 49,500
Inventories 404,554 114,646
Tax credit carryforwards 198,170
-------- --------
896,354 362,316
Non-current deferred tax liabilities:
Plant and equipment (48,595) (31,257)
-------- --------
$847,759 $331,059
======== ========
9. BENEFIT PLANS
The Company has in effect a 401(k) savings plan in which eligible employees can
elect to defer between 2% and 15% of wages. The Company decides on a yearly
basis if a discretionary contribution will be made. There were no discretionary
contributions made for the years ended March 31, 1996 and 1995.
10. RELATED PARTIES
The Company leases space in a manufacturing facility owned by Systemation Joint
Venture (a Wisconsin partnership). The majority shareholder of the Company is
also a partner of Systemation Joint Venture. Base rental expense was $150,000
for the years ended March 31, 1996 and 1995. The lease expires October 31, 1996.
11. SIGNIFICANT CUSTOMERS
Sales to two customers represent approximately 16% and 10% of total sales for
the year ended March 31, 1996 and approximately 17% and 16% for the year ending
March 31, 1995.
12. CONCENTRATIONS
Accounts receivable from three customers represent approximately 26%, 15% and 3%
of total accounts receivable outstanding as of March 31, 1996 and approximately
12%, 6%, and 13% as of March 31, 1995.
Accounts payable to two vendors represent approximately 19% and 12% of total
accounts payable outstanding as of March 31, 1996 and approximately 26% and 0%
as of March 31, 1995.
13. FOREIGN EXPORT SALES
Foreign export sales accounted for 72 percent and 65 percent of the Company's
revenues in fiscal 1996 and 1995, respectively.
<PAGE>
The Company's domestic and foreign export sales during the years ended March 31,
1996 and 1995 are set forth below:
1996 1995
United States $ 8,186,288 $ 6,152,869
Asia/Pacific Rim 18,598,359 10,056,074
Europe 2,543,521 1,321,486
----------- -----------
Total $29,328,168 $17,530,429
=========== ===========
14. SUBSEQUENT EVENT
Effective October 1, 1996, the Company was acquired by Robotic's Vision Systems
Inc. The acquisition transaction was accounted for as a pooling of
interests. In conjunction with the sale, substantially all debt was
extinguished as of October 31, 1996.
* * * * * *
<PAGE>
UNAUDITED PRO FORMA CONDENSED COMBINED
FINANCIAL INFORMATION
The following unaudited condensed combined financial information sets forth the
combined financial position and combined results of operations of Robotic Vision
Systems Inc. ("RVSI") and Systemation Engineered Products, Inc. ("SEP") assuming
the Merger was accounted for using the "pooling of interests" method of
accounting and that the Merger was consummated (i) as of September 30, 1996, for
the unaudited pro forma condensed combined balance sheet and (ii) as of the
beginning of the earliest period presented in the unaudited pro forma condensed
combined statements of operations.
For all periods presented in the unaudited pro forma condensed combined
statements of operations, the weighted average number of common and common
equivalent shares gives effect to the proposed issuance of 1,740,000 shares of
RVSI common stock in exchange for all of the issued and outstanding shares of
SEP common stock.
The unaudited pro forma information combines the historical balance sheets of
RVSI and SEP as of September 30, 1996 and the historical statements of
operations of RVSI for the years ended September 30, 1996, 1995 and 1994 with
the historical statements of operations of SEP for the twelve months ended
September 30, 1996, and the fiscal years ended March 31, 1996 and 1995,
respectively.
The following unaudited pro forma condensed combined information is presented
for illustration purposes only and is not necessarily indicative of the
financial position or results of operations which would actually have been
reported had the Merger been in effect during those periods or which may be
reported in the future. The statements should be read in conjunction with the
historical financial statements and notes thereto of SEP which have been
included elsewhere herein in this Form 8-K filing. The statements should also be
read in conjunction with the historical financial statements of RVSI included in
the Annual Report on Form 10-K.
<PAGE>
SUMMARY OF UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
FOR THE YEAR ENDED SEPTEMBER 30,
----------- -------------------------
1996 1995 1994
----------- ----------- -----------
<S> <C> <C> <C>
REVENUES $ 143,540 $ 122,125 $ 90,994
COST OF REVENUES 74,669 59,891 45,594
----------- ----------- -----------
GROSS PROFIT 68,871 62,234 45,400
----------- ----------- -----------
COSTS AND EXPENSES:
Selling, general and administrative 39,603 34,257 28,552
Research and development 18,405 15,751 11,465
Merger expenses 1,801 1,305 --
Separation costs -- -- 469
Interest (income) expense, net (392) 18 276
----------- ----------- -----------
59,417 51,331 40,762
----------- ----------- -----------
INCOME BEFORE INCOME TAXES 9,454 10,903 4,638
INCOME TAX BENEFIT (PROVISION) 805 92 (1)
----------- ----------- -----------
NET INCOME $10,259 $10,995 $4,637
========== ========== ==========
NET INCOME PER SHARE:
Primary $0.48 $0.55 $ 0.25
========== ========== ==========
Fully diluted $0.48 $0.55 $ 0.25
========== ========== ==========
WEIGHTED AVERAGE NUMBER OF
COMMON AND COMMON
EQUIVALENT SHARES OUTSTANDING:
Primary 21,386 19,872 18,358 (a)
========== ========== ==========
Fully diluted 21,393 19,995 18,560 (a)
========== ========== ==========
</TABLE>
See accompanying notes to unaudited pro forma condensed combined financial
information.
<PAGE>
UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
SEPTEMBER 30, 1996
(In thousands)
<TABLE>
<CAPTION>
RVSI SEP
SEPTEMBER 30, SEPTEMBER 30, COMBINED
1996 1996 SEPTEMBER 30,
HISTORICAL HISTORICAL ADJUSTMENTS 1996
--------------- -------------- -------------- ---------------
<S> <C> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 17,975 $ 217 $ $ 18,192
Investments 1,500 - 1,500
Accounts receivable, net 20,711 6,627 27,338
Inventories 17,453 6,137 23,590
Deferred income taxes 6,205 1,911 8,116
Prepaid expenses and other current assets 685 663 1,348
--------------- -------------- -------------- ---------------
Total current assets 64,529 15,555 - 80,084
PROPERTY, PLANT AND EQUIPMENT, Net 7,981 1,285 9,266
GOODWILL, Net 2,627 - 2,627
INVESTMENTS 665 - 665
OTHER ASSETS 4,242 102 4,344
--------------- -------------- -------------- ---------------
TOTAL ASSETS $ 80,044 $ 16,942 $ - $ 96,986
============== ============= ============= ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Loans payable $ 844 $ 7,480 $ $ 8,324
Accounts payable 9,995 1,885 11,880
Accrued expenses and other current liabilities 7,941 4,293 12,234
Advance contract payments received 865 806 1,671
--------------- -------------- -------------- ---------------
Total current liabilities 19,645 14,464 - 34,109
LONG-TERM DEBT - 250 250
OTHER LIABILITIES 229 - 229
--------------- -------------- -------------- ---------------
Total liabilities 19,874 14,714 - 34,588
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock - RVSI ($0.01 par value) 190 - 17 (b) 207
Common stock - SEP ($1.00 par value) - 8 (8) (b) -
Additional paid-in capital 143,632 9 (377) (b) 143,264
Retained earnings (accumulated deficit) (83,974) 2,579 (81,395)
Unrealized gain on investments 147 - 147
Cumulative translation adjustment 175 - 175
--------------- -------------- -------------- ---------------
60,170 2,596 (368) 62,398
Less: Treasury stock, at cost - (368) 368 (b) -
--------------- -------------- -------------- ---------------
Total stockholders' equity 60,170 2,228 - 62,398
--------------- -------------- -------------- ---------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 80,044 $ 16,942 $ - $ 96,986
============== ============= ============= ==============
</TABLE>
See accompanying notes to unaudited pro forma condensed combined financial
information.
<PAGE>
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FISCAL YEAR ENDED SEPTEMBER 30, 1996
(In thousands)
<TABLE>
<CAPTION>
RVSI SEP
SEPTEMBER 30, SEPTEMBER 30, COMBINED
1996 1996 SEPTEMBER 30,
HISTORICAL HISTORICAL ADJUSTMENTS 1996
-------------- -------------- --------------- ---------------
<S> <C> <C> <C> <C>
REVENUES $ 111,022 $ 32,532 $ (14) (c) $ 143,540
COST OF REVENUES 51,214 23,469 (14) (c) 74,669
-------------- -------------- --------------- ---------------
GROSS PROFIT 59,808 9,063 - 68,871
-------------- -------------- --------------- ---------------
COSTS AND EXPENSES:
Selling, general and administrative 32,018 7,585 39,603
Research and development 14,679 3,726 18,405
Merger expenses 2,036 625 (860) (d) 1,801
Interest (income) expense, net (868) 476 (392)
-------------- -------------- --------------- ---------------
47,865 12,412 (860) 59,417
-------------- -------------- --------------- ---------------
INCOME (LOSS) BEFORE INCOME TAXES 11,943 (3,349) 860 9,454
INCOME TAX BENEFIT 55 1,077 (327) (e) 805
-------------- -------------- --------------- ---------------
NET INCOME (LOSS) $ 11,998 $ 2,272 $ 533 $ 10,259
============= ============= ============== ==============
NET INCOME PER SHARE
Primary $ 0.60 $ 0.48
============= ==============
Fully diluted $ 0.60 $ 0.48
============= ==============
WEIGHTED AVERAGE NUMBER OF COMMON
AND COMMON
EQUIVALENT SHARES OUTSTANDING:
Primary $ 19,888 $ 21,386
============= ==============
Fully diluted $ 19,895 $ 21,393
============= ==============
</TABLE>
See accompanying notes to unaudited pro forma condensed combined financial
information.
<PAGE>
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FISCAL YEAR ENDED SEPTEMBER 30, 1995
(In thousands)
<TABLE>
<CAPTION>
RVSI SEP
SEPTEMBER 30, MARCH 31, COMBINED
1995 1996 SEPTEMBER 30,
HISTORICAL HISTORICAL ADJUSTMENTS 1995
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
REVENUES $ 93,005 $ 29,328 $ (208) (c) $ 122,125
COST OF REVENUES 42,791 17,308 (208) (c) 59,891
-------------- -------------- -------------- --------------
GROSS PROFIT 50,214 12,020 - 62,234
-------------- -------------- -------------- --------------
COSTS AND EXPENSES:
Selling, general and administrative 27,321 6,936 34,257
Research and development 12,980 2,771 15,751
Merger expenses 1,305 - 1,305
Interest (income) expense, net (273) 291 18
-------------- -------------- -------------- --------------
41,333 9,998 - 51,331
-------------- -------------- -------------- --------------
INCOME BEFORE INCOME TAXES 8,881 2,022 - 10,903
INCOME TAX BENEFIT (PROVISION) 635 (543) 92
-------------- -------------- -------------- --------------
NET INCOME $ 9,516 $ 1,479 $ - $ 10,995
============= ============= ============= =============
</TABLE>
<TABLE>
<CAPTION>
NET INCOME PER SHARE:
<S> <C> <C>
Primary $ 0.52 $ 0.55
============= =============
Fully diluted $ 0.52 $ 0.55
============= =============
WIGHTED AVERAGE NUMBER OF
COMMON AND COMMON
EQUIVALENT SHARES OUTSTANDING:
Primary 18,132 19,872
============= =============
Fully diluted 18,255 19,995
============= =============
</TABLE>
See accompanying notes to unaudited pro forma condensed combined financial
information.
<PAGE>
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FISCAL YEAR ENDED SEPTEMBER 30, 1994
(In thousands)
<TABLE>
<CAPTION>
RVSI SEP
SEPTEMBER 30, MARCH 31, COMBINED
1994 1995 SEPTEMBER 30,
HISTORICAL HISTORICAL ADJUSTMENTS 1994
-------------- -------------- -------------- ---------------
<S> <C> <C> <C> <C>
REVENUES $ 73,865 $ 17,530 $ (401) (c) $ 90,994
COST OF REVENUES 35,876 10,119 (401) (c) 45,594
-------------- -------------- -------------- ---------------
GROSS PROFIT 37,989 7,411 - 45,400
-------------- -------------- -------------- ---------------
COSTS AND EXPENSES:
Selling, general and administrative 24,231 4,321 28,552
Research and development 10,255 1,210 11,465
Separation costs 469 - 469
Interest expense, net 90 186 276
-------------- -------------- -------------- ---------------
35,045 5,717 - 40,762
-------------- -------------- -------------- ---------------
INCOME BEFORE INCOME TAXES 2,944 1,694 - 4,638
INCOME TAX (PROVISION) BENEFIT 227 (228) (1)
-------------- -------------- -------------- ---------------
NET INCOME $ 3,171 $ 1,466 $ - $ 4,637
============= ============= ============= ==============
</TABLE>
<TABLE>
<CAPTION>
NET INCOME PER SHARE:
<S> <C> <C>
Primary $ 0.19 $ 0.25
============= ==============
Fully diluted $ 0.19 $ 0.25
============= ==============
<CAPTION>
WEIGHTED AVERAGE NUMBER OF
COMMON AND COMMON
EQUIVALENT SHARES OUTSTANDING:
<S> <C> <C>
Primary 16,618 18,358
============= ==============
Fully diluted 16,820 18,560
============= ==============
</TABLE>
See accompanying notes to unaudited pro forma condensed combined financial
information.
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONDENSED
COMBINED FINANCIAL INFORMATION
(a) Weighted average number of common and common share equivalents are
calculated using the Modified Treasury Stock method for the year ended
September 30, 1994.
(b) The pro forma adjustment to common stock, additional paid-in capital, and
treasury stock represents the exchange of SEP common stock for RVSI common
stock.
(c) The pro forma adjustment to revenues and cost of revenues represents the
elimination of intercompany transactions between SEP and a subsidiary of
RVSI.
(d) The pro forma adjustment to non-recurring costs represents the non-recurring
merger expenses incurred for the year ended September 30, 1996 which are
directly attributable to the SEP merger.
(e) The pro forma adjustment to the income tax benefit for the fiscal year ended
September 30, 1996 represents the tax effect of the elimination of non-
recurring merger expenses, which were directly attributable to the SEP
merger.
<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.
Dated: January 22, 1997 ROBOTIC VISION SYSTEMS, INC.
(Registrant)
By: /s/Robert H. Walker
Robert H. Walker
Executive Vice President
