<PAGE> 1
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 Setember 28, 1996
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 0-599
THE EASTERN COMPANY
(Exact Name of Registrant as specified in its charter)
Connecticut 06-0330020
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
112 Bridge Street, Naugatuck, Connecticut 06770
(Address of principal executive offices) (Zip Code)
(203) 729-2255
(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 the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding as of September 28, 1996
Common Stock, No par value 2,699,284
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<PAGE> 2
PART I
FINANCIAL INFORMATION
THE EASTERN COMPANY AND SUBSIDIARIES
ITEM I CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED)
- ------ -------------------------------------
<TABLE>
<CAPTION>
ASSETS
CURRENT ASSETS Sept. 28, 1996 Dec. 30, 1995
- -------------- ------------ -----------
<S> <C> <C>
Cash and cash equivalents $ 1,746,039 $ 1,521,361
Accounts receivable, less allowance: 8,268,586 7,810,742
1996- $573,000; 1995- $501,000
Inventories 11,454,276 11,792,876
Prepaid expenses and other current assets 1,837,322 2,010,332
----------- -----------
Total Current Assets 23,306,223 23,135,311
Property, plant and equipment 27,416,239 25,090,676
Less accumulated depreciation (13,432,825) (11,405,013)
---------- ----------
13,983,414 13,685,663
Prepaid pension cost 4,001,206 3,069,066
Other assets, net 2,194,004 1,200,059
----------- -----------
TOTAL ASSETS $ 43,484,847 $ 41,090,099
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Notes payable current $ 3,349,296 $ 1,119,313
Accounts payable 2,649,084 3,004,297
Accrued compensation and withholding 1,483,137 908,297
Accrued expenses 967,343 863,749
----------- -----------
TOTAL CURRENT LIABILITIES 8,448,860 5,895,656
Deferred federal income taxes 2,237,900 2,237,900
Long-term debt 288,249 339,856
Accrued postretirement benefits 2,819,003 2,810,003
SHAREHOLDERS' EQUITY
Common Stock, no par value:
Authorized shares - 25,000,000
Issued and outstanding shares: 8,045,863 8,017,738
1996-2,699,284; 1995-2,696,284
(Excluding shares in Treasury:
1996-610,987; 1995-610,987)
Preferred Stock, no par value
Authorized shares - 2,000,000
(No shares issued)
Retained earnings 21,644,972 21,788,946
----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 43,484,847 $ 41,090,099
=========== ===========
</TABLE>
See accompanying notes.
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<PAGE> 3
<TABLE>
THE EASTERN COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME (UNAUDITED)
<CAPTION>
NINE MONTHS ENDED THREE MONTHS ENDED
Sept.28,1996 Sept.30,1995 Sept.28,1996 Sept.30,1995
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Net sales $43,607,683 $45,825,248 $13,715,095 $14,379,195
Interest income 90,474 95,096 19,944 24,473
----------- ---------- ---------- ----------
Total 43,698,157 45,920,344 13,735,039 14,403,668
Cost of products sold 34,392,039 34,887,438 10,158,049 11,194,845
----------- ----------- ---------- ----------
9,306,118 11,032,906 3,576,990 3,208,823
Selling and admin. expenses 8,150,778 7,521,063 2,800,803 2,339,522
Interest expense 116,021 65,314 42,355 5,066
Other income - (66,787) - (37,700)
----------- ----------- ---------- ----------
INCOME FROM CONTINUING
OPERATIONS 1,039,319 3,513,316 733,832 901,935
Income taxes 385,348 1,273,375 254,403 300,411
----------- ----------- ---------- ----------
INCOME FROM CONTINUING
OPERATIONS 653,971 2,239,941 479,429 601,524
Discontinued operations - (238,224) - (142,506)
----------- ----------- ---------- ----------
NET INCOME $ 653,971 $ 2,001,717 $ 479,429 $ 459,018
=========== =========== ========== ==========
Income per share from
continuing operations $ 0.24 $ 0.81 $ 0.18 $ 0.22
Net income per share $ 0.24 $ 0.72 $ 0.18 $ 0.16
Cash dividends per share $ 0.345 $ 0.345 $ 0.115 $ 0.115
Average shares outstanding 2,697,559 2,775,665 2,697,559 2,775,665
</TABLE>
See accompanying notes.
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<PAGE> 4
<TABLE>
THE EASTERN COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
<CAPTION>
NINE MONTHS ENDED
Sept 28, 1996 Sept 30, 1995
------------- -------------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $ 653,971 $ 2,001,717
Adjustments to reconcile net income to net
cash provided from operations:
Depreciation and amortization 2,211,386 1,938,918
Loss (gain) on sale of equip. and other assets 335 (15,212)
Postretirement benefits other than pensions 9,000 8,696
Provision for losses on accounts receivable 39,011 83,523
Changes in Operating Assets and Liabilities:
Accounts receivable (499,271) 865,485
Inventories 336,792 (1,785,123)
Prepaid expenses 172,977 356,082
Prepaid pension (932,140) (252,857)
Accounts payable (351,919) (127,484)
Accrued expenses 807,172 804,257
Other assets (376,106) (222,517)
---------- -----------
NET CASH PROVIDED BY OPERATING ACTIVITIES 2,071,208 3,655,485
INVESTING ACTIVITIES:
Purchases of property, plant, and equipment (2,348,758) (2,142,177)
Proceeds from sale of equipment and other assets 13,600 1,226,598
Other - (148,756)
---------- -----------
NET CASH USED FOR INVESTING ACTIVITIES (2,335,158) (1,064,335)
FINANCING ACTIVITIES:
Payment on line of credit - (1,400,000)
Proceeds from line of credit 1,500,000 -
Principal payments on long-term debt (109,439) (810,000)
Proceeds from sales of Common Stock 28,125 29,510
Purchases of Common Stock for the treasury - (29,509)
Dividends paid (930,911) (957,707)
---------- -----------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES 487,775 (3,167,706)
Effect of exchange rate changes on cash 853 1,672
---------- -----------
NET INCREASE(DECREASE)IN CASH AND CASH EQUIVALENTS 224,678 (574,884)
Cash and Cash Equivalents at Beginning of Year 1,521,361 2,610,244
---------- -----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 1,746,039 $ 2,035,360
=========== ===========
</TABLE>
See accompanying notes.
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<PAGE> 5
<TABLE>
THE EASTERN COMPANY AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER SHARE (UNAUDITED)
<CAPTION>
NINE MONTHS ENDED THREE MONTHS ENDED
Sept 28,1996 Sept 30,1995 Sept 28,1996 Sept 30,1995
------------ ------------- ------------- ------------
<S> <C> <C> <C> <C>
Primary:
Average Shares
Outstanding 2,697,559 2,775,665 2,697,559 2,775,665
Net effect of
dilutive stock
options -- based
on the treasury
stock method
using average
market price
33,996 50,510 33,996 50,510
--------- --------- --------- ---------
Total 2,731,555 2,826,175 2,731,555 2,826,175
========= ========= ========= =========
Income from continuing
operations per share $ 653,971 $2,239,941 $ 479,429 $ 601,524
========== ========== ========== =========
Net Income $ 653,971 $2,001,717 $ 479,429 $ 459,018
=========== ========== ========== =========
Income from continuing
operations per share $0.24 $0.79 $0.18 $0.21
===== ===== ===== =====
Net income per share $0.24 $0.71 $0.18 $0.16
===== ===== ===== =====
Fully Diluted:
Average Shares
Outstanding 2,697,559 2,775,665 2,697,559 2,775,665
Net effect of
dilutive stock
options -- based
on the treasury
stock method
using quarter-end
market price, if
higher than average
market price 40,763 50,510 40,763 50,510
--------- --------- -------- ---------
Total 2,738,322 2,826,175 2,738,322 2,826,175
========= ========= ========= =========
Income from continuing
operations per share $ 653,971 $2,239,941 $ 479,429 $ 601,524
========== ========== ========== =========
Net Income $ 653,971 $2,001,717 $ 479,429 $ 459,018
========== ========== ========== =========
Income from continuing
operations per share $0.24 $0.79 $0.18 $0.21
===== ===== ===== =====
Net income per share $0.24 $0.71 $0.18 $0.16
===== ===== ===== =====
</TABLE>
See accompanying notes.
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<PAGE> 6
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
September 28, 1996
Note A - Basis of Presentation
The accompanying unaudited consolidated condensed financial statements have
been prepared in accordance with the instructions to Form 10-Q and do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements.
The accompanying consolidated condensed financial statements are unaudited.
However, in the opinion of the management, all adjustments
(consisting only of normal recurring accruals) necessary for a fair
presentation of the results of operations for such interim periods have been
reflected therein.
Certain 1995 amounts have been reclassified to conform to the 1996 presentation.
Note B - Net Income Per Share
Net income per share of common stock is based on the weighted average number
of shares outstanding during each period 1996- 2,697,559 shares; 1995 -
2,775,665 shares. Common stock equivalents (Stock Options) did not have a
material dilutive effect on net income per share. The computation of net
income per share of common stock on a fully diluted basis did not result in
any material dilution in 1996 or 1995.
Note C - Discontinued Operation
In August 1995, the Company sold the business and substantially all assets of
its construction segment retaining accounts receivable. At September 28, 1996
and December 30, 1995 accounts receivable include $481,996 and $582,627
respectively applicable to the discontinued construction segment.
Note D - Litgation
The Registrant is involved in litigation relating to environmental matters for
which the ultimate outcome is not expected to have any material adverse impact
on financial position, operating results or liquidity. See Part II Item 1
Legal Proceedings for further information.
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<PAGE> 7
ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Results of Operations
Income from continuing operations for the third quarter 1996 was $479,429 or
$.18 per share on sales of $13,715,095 versus income from continuing
operations for the third quarter of 1995 of $601,524 or $.22 per share on
sales of $14,379,195. Income from continuing operations for the first nine
months of 1996 was $653,971 or $.24 per share on sales of $43,607,683 versus
income from continuing operations for the first nine months of 1995 of
$2,239,941 or $.81 per share on sales of $45,825,248. Net income for the
first nine months of 1995 was $2,001,717 or $.72 per share after the loss from
the discontinued construction segment of $238,224 or $.09 per share.
Current third quarter sales were down 5% compared to the same period a year
ago. Volume declined 9% in the third quarter primarily due to the continued
down turn in the transportation industry. New product sales and price
increases of 3% and 2% helped offset the decline in volume during the third
quarter. For the first nine months of 1996 volume was down 9% while price
increases and new product sales were each up 2%, respectively. New products
include vehicular hardware produced and designed by Eberhard Manufacturing
division; the "Gun Blok", a patented keyless trigger lock for securing most
hand guns and rifles, offered by the CCL Security Products division; new
malleable castings products manufactured by the Frazer & Jones division; and
hardware components for the appliance industry offered by the Canadian
subsidiary, Eberhard Hardware Manufacturing, Ltd. In August 1996, the
Registrant announced that it entered into a long-term agreement to supply
engineered mine roof fasteners to Excel Mining Systems, the Country's largest
manufacturer of mine roof bolts. This agreement will ensure the Registrant's
position as the largest and lowest cost producer of proprietary fasteners used
in underground mining in North America. Sales for the first nine months of
1996 to the underground coal mining industry were down from the comparable
period a year ago. Dispite the softness in the underground coal mining
industry as a whole the Registrant expects that its business will increase as
a result of the signing of the long-term supply agreement with Excel Mining
Systems. Contract malleable casting sales continue to increase from the
comparable periods a year ago helping to offset the decline in the mining
business. Demand for the Registrant's heavy hardware servicing the tractor
trailer industry continues to be on a down cycle with sales off 45% from the
third quarter a year ago and down 34% for the nine months 1996 compared to the
same period a year ago. The Registrant continues to engineer and develop new
products to meet the security needs of industrial customers. Sales of
custom locks were up 1.5% in the third quarter 1996 and 3.5% for the nine
months ending September 28, 1996 versus the comparable periods a year ago.
The Registrant's gross margin as a percentage of sales for the three and nine
months ended September 28, 1996 was 26% and 21%, respectively, compared to 22%
and 24% for comparable periods a year ago. Improved capacity utilization at
the Frazer & Jones division helped improved gross margins in the third
quarter 1996; production increased in anticipation of increased demand as the
result of the aforementioned agreement with Excel Mining Systems. In
addition, hardware components produced for the appliance industry contributed
favorably to the gross margin in the third quarter 1996 versus the same period
a year ago.
-7-
<PAGE> 8
Third quarter selling and administrative expenses were up 20% or $461 thousand
from the same period a year ago. Increased sales staffing, higher commission,
increased advertising, additional amortization expense associated with the
agreement with Excel Mining Systems, and additional legal expenses account for
the increases. Selling and administrative expenses for the nine months ended
September 28, 1996 were up 8% or $630 thousand from the same period a year
ago. The majority of the increase in expenses arose in the third quarter.
Other income for the three and nine months ended September 28, 1996, was down
$38 thousand and $67 thousand respectively compared to the same periods a year
ago. An agreement under which the Registrant received commission income
expired in August 1995.
The effective tax rate for the third quarter and first nine months of 1996 was
35% and 37%, respectively, versus the comparable periods a year ago of 33% and
36%, respectively. The overall increase in the effective tax rate for 1996
was due to higher effective foreign taxes.
Liquidity and Sources of Capital
Cash flows from operations were $2.071 million for the first nine months of
1996 versus $3.655 million in the first nine months of 1995. The change in
cash flows resulted from the timing differences collecting accounts receivable
and payments of liabilities, and the build up of inventory. The Registrant
drew down $1.5 million under its short-term line of credit in the first nine
months of 1996 for normal liquidity needs.
Additions to property, plant and equipment were $2.3 million during the first
nine months of 1996 versus $2.1 million for the comparable period a year ago.
Total 1996 capital expenditures are expected to approximate the $2.5 million
level of depreciation for the year.
Inventory increased from the 1995 year-end level by $337 thousand with an
inventory turnover rate of 5 turns per year versus the year-end level of 6
turns per year. A slight build up in inventory was required to fulfill the
supply agreement with Excel Mining Systems. The Registrant anticipates
current inventory levels will approximate the year-end balance. The average
day's sales in accounts receivable increased to 55 days for collection versus
the end of 1995 collection average of 53 days. The prime reason for the
increase in collection days results from accounts receivable still being
collected from the discontinued Construction segment where the balance of
uncollected accounts receivable was $482 thousand at the end of September
1996. The Registrant continues to pursue the collection of the remaining
outstanding receivables from this segment.
The Registrant drew down an additional $1 million on its short-term line of
credit in October 1996 to use towards the Excel Mining System purchase
agreement.
Other Matters
On June 24, 1994 the Registrant settled all claims with both the Beacon
Heights Coalition and the Laurel Park Coalition and the respective complaints
against the Registrant on behalf of the Coalitions were dismissed by
stipulation. Claims against the Registrant and certain other defendants filed
by the two governments agencies as described in Part II, Item 1 below were
dismissed by the Court. A final judgement was entered by the U.S. District
Court in the consolidated proceedings on March 17, 1995. Appeals, however,
were filed by the two government agencies as described in Part II, Item 1
below.
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<PAGE> 9
On November 1, 1996, the United States Court of Appeals for the Second Circuit
reversed the U.S. District Court's ruling dismissing government agencies
environmental claims against the Registrant and certain other defendants, and
the environmental claims by the Laurel Park and Beacon Heights Coalitions
against numerous defendants. The Court of Appeals remanded the case to the
U.S. District Court in Connecticut for further proceedings. See further
description in Part II, Item 1 below.
The Registrant continues to actively monitor the situation. It is
management's opinion that the resolution of these matters will not have a
material adverse effect on the Registrant's financial position, operating
results or liquidity.
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<PAGE> 10
PART II
OTHER INFORMATION
ITEM 1 LEGAL PROCEEDINGS
In April 1988, Murtha Enterprises Inc. and related parties (collectively
"Murtha"), as the result of a February 1987 suit (docket number N-87-52 PCD)
brought by the U. S. Environmental Protection Agency (the "EPA") and others,
concerning the Beacon Heights and Laurel Park landfills, instituted third-
party actions against approximately 200 companies or individuals including the
Registrant. The underlying suit against Murtha was settled with EPA and the
other parties and the Consent Decree has been approved by the Court.
On September 22, 1988, the EPA filed a complaint against the Registrant and
seven other defendants seeking recovery of present and future response costs
incurred by the United States in connection with the Beacon Heights landfill.
The complaint alleged total damages of approximately $1.8 million ($1.3
million actual and $.5 million future). On October 31, 1988 the court
consolidated the EPA action against the Registrant with the other cases under
docket number N-87-52 (PCD).
By complaint dated September 6, 1990, the Beacon Heights Coalition (the
"Beacon Coalition"), a group of parties who have entered into a consent order
with EPA, instituted a direct action against the Registrant and approximately
400 other named parties concerning the Beacon Heights landfill. The Beacon
Coalition claimed that these defendants generated or transported hazardous
substances disposed of at the Beacon Heights landfill, and are therefore
responsible for a share of the Beacon Coalition's response costs.
In March 1991, a Laurel Park Coalition which did not include the Registrant
entered into Consent Decree and Administrative Order by Consent with the EPA
and the State of Connecticut to remediate the Laurel Park landfill. The
Consent Decree has been approved by the Court.
In May 1991, EPA and the State of Connecticut ("State") each filed a complaint
against the Registrant and three other defendants seeking recovery of present
and future response costs incurred in connection with the Laurel Park
landfill. The EPA claimed costs in excess of $1.8 million and the state
claimed costs in excess of $2.5 million. On July 1, 1991, the court
consolidated these actions against the Registrant with the other cases under
docket number N-87-52 (PCD).
By order dated February 8, 1994, the court granted a motion filed by
Registrant for judgement on the pleadings against EPA and the state with
respect to each of their claims against Registrant. By motions dated February
22, 1994 and February 23, 1994, EPA and the State respectively moved for
reconsideration of the court's order, which motions were denied.
By order dated February 8, 1994, the court permitted the Laurel Park Coalition
to file a complaint against eight parties including the Registrant, which
claims were to be assigned for trial if the Coalition filed a complaint.
On June 24, 1994 , the Registrant settled all claims with both the Beacon
Heights Coalition and the Laurel Park Coalition and the respective complaints
against the Registrant on behalf of the Coalitions were dismissed by
stipulation.
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<PAGE> 11
On March 17, 1995, the U.S. District Court entered a final judgement in the
consolidated proceedings (docket number N-87-52(PCD)) which included the
granting of Registrant's motion for judgement on the pleadings. As a result
of this judgement, no complaints were then pending in the U.S. District Court
involving the Registrant.
On April 17, 1995, the State filed its notice of appeal from this final
judgement with the U.S. District Court. On May 10, 1995, EPA filed its notice
of appeal from the judgement.
On November 1, 1996 the U.S. Court of Appeals for the Second Circuit reversed
the District Court ruling dismissing EPA and State of Connecticut
environmental claims against the Registrant and environmental claims by the
Laurel Park and Beacon Heights Coalitions against numerous defendants. The
Court of Appeals remanded the case to the U.S. District Court in Connecticut
for further proceedings. The governmental lawsuits, brought after
governmental settlements with the Coalitions, seek to recover remediation
costs of the governments unreimbursed by the Coalition settlements or the
settlement with the owner/operator in connection with the Laurel Park and
Beacon Heights landfills. The EPA has claimed that the Registrant and five
other defendants (two corporate and three individual) are responsible for an
aggregate of $4.2 million in remediation costs with respect to the Beacon
Heights landfill and that the Registrant and one other corporate defendant are
responsible for an aggregate of $2.5 million in remediation costs with respect
to the Laurel Park landfill; Connecticut has claimed that the Registrant and
one other defendant are responsible for an aggregate of $.08 million in
remediation costs with respect to the Laurel Park landfill. The Registrant
intends to continue to vigorously contest any liability relating to these
governmental claims. The Registrant would also pursue its rights of
contribution against the other defendants in the event of any liability, which
the Registrant expects would significantly reduce any liability imposed. In
addition, it would file claims against its insurance carriers.
In its decision, the Second Circuit also reversed the U.S. District Court's
dismissal of numerous actions brought by the Beacon Heights and Laurel Park
Coalitions against non-settling parties. These Coalitions assumed full
responsibility for cleaning up the two landfill sites and, as noted above, the
Registrant has settled with both Coalitions with respect to liability at these
sites in 1994. It is believed that many of the defendants in the pending
Coalition actions and certain other persons who have not been sued by the
governments have a responsibility for remediation cost and may be brought into
these actions as co-defendants with the Registrant. The Registrant intends to
resist the EPA and State claims and if necessary bring these other persons
into the action to share the costs of reimbursements to the governments if
ultimately imposed.
The Registrant will continue to vigorously pursue its legal interest in this
matter. The Registrant believes that these actions will not have a materially
adverse impact on the Registrant's consolidated financial position, operating
results or liquidity.
The Registrant is currently involved in two actions with MMI Investments, LLC
("MMI"). The first action is captioned MMI Investments, LLC vs. The Eastern
Company, Docket number CV 96-134473 ("MMI's action"). The second action is
The Eastern Company vs. MMI Investments, LLC, docket number CV 96-134839
("Eastern's action"). The two actions have been consolidated and are pending
in the Connecticut Superior Court for the Judicial District of Waterbury at
Waterbury. MMI's action was filed on or about August 15, 1996. The
Registrant's action was filed on or about September 9, 1996.
In MMI's action, MMI is seeking an order of mandamus from the Court to compel
the Registrant to turn over a copy of its shareholder list to MMI. The
Registrant has denied the request and
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<PAGE> 12
defended the action on the grounds that MMI has not satisfied the requirements
of Connecticut law governing shareholder requests for a shareholder list.
In the Registrant's action, it seeks injunctive relief enjoining MMI
(purporting to represent 10% of the Registrant's shares) from calling or
attempting to call a special meeting of the Registrant's shareholders on the
grounds that (A) the request does not comport with the threshold requirement
under Connecticut Law and the Registrant's bylaws that the request be made by
holders of at least 35% of the Registrant's shares and (B) that the purported
purposes submitted by MMI for the special meeting are improper. The
Registrant also seeks declaratory relief regarding these two issues.
There are no other material legal proceedings, other than ordinary routine
litigation incidental to the business, to which either the Registrant or any
of its subsidiaries is a party of or which any of their property is the
subject.
ITEM 2 CHANGES IN SECURITIES
None
ITEM 3 DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5 OTHER INFORMATION
None
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K
On July 29, 1996, The Board of Directors of The Eastern
Company (the "Registrant") amended the By-laws of the Registrant as set forth
in Exhibit 1 of Form 8K filed with the Commission on July 29, 1996 pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934.
-12-
<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.
THE EASTERN COMPANY
(Registrant)
DATE: November 12, 1996 By /s/ STEDMAN G. SWEET
---------------------
Stedman G. Sweet
President and Chief Executive Officer
DATE: November 12, 1996 By /s/ DONALD E. WHITMORE, JR.
---------------------------
Donald E. Whitmore, Jr., Vice
President and Chief Financial Officer
-13-
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-30-1995
<PERIOD-END> SEP-28-1996
<CASH> 1,746,039
<SECURITIES> 0
<RECEIVABLES> 8,268,586
<ALLOWANCES> 573,000
<INVENTORY> 11,454,276
<CURRENT-ASSETS> 23,306,223
<PP&E> 27,416,239
<DEPRECIATION> 13,432,825
<TOTAL-ASSETS> 43,484,847
<CURRENT-LIABILITIES> 8,448,860
<BONDS> 0
<COMMON> 8,045,863
0
0
<OTHER-SE> 21,644,972
<TOTAL-LIABILITY-AND-EQUITY> 43,484,847
<SALES> 43,607,683
<TOTAL-REVENUES> 43,698,157
<CGS> 34,392,039
<TOTAL-COSTS> 34,392,039
<OTHER-EXPENSES> 8,079,013
<LOSS-PROVISION> 71,765
<INTEREST-EXPENSE> 116,021
<INCOME-PRETAX> 1,039,319
<INCOME-TAX> 385,348
<INCOME-CONTINUING> 653,971
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 653,971
<EPS-PRIMARY> .24
<EPS-DILUTED> .24
</TABLE>
