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 27, 1997
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 27, 1997
Common Stock, No par value 2,594,207
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PART I
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FINANCIAL INFORMATION
THE EASTERN COMPANY
ITEM I CONSOLIDATED CONDENSED BALANCE SHEET (UNAUDITED)
------
ASSETS
September 27, 1997 December 28, 1996
------------------ -----------------
CURRENT ASSETS
<S> <C> <C>
Cash and cash equivalents 2,960,492 2,269,031
Accounts receivable, less allowance: 10,148,169 7,018,961
1997- $678,000; 1996- $567,000
Inventories 11,874,468 10,897,827
Prepaid expenses and other current assets 1,998,371 2,287,155
---------- ----------
Total Current Assets 26,981,500 22,472,974
Property, plant and equipment 27,412,085 25,961,043
Accumulated depreciation (14,000,314) (12,074,420)
---------- ----------
13,411,771 13,886,623
Prepaid pension cost 4,170,493 4,017,397
Other assets, net 2,133,150 2,115,240
---------- ----------
TOTAL ASSETS $46,696,914 $42,492,234
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Notes payable $ 5,130,980 $ 3,630,980
Accounts payable 3,318,346 2,396,582
Accrued compensation and withholding 1,744,157 859,701
Accrued expenses 2,350,410 823,560
---------- ---------
Total Current Liabilities 12,543,893 7,710,823
Deferred federal income taxes 2,389,800 2,389,800
Long-term debt 93,413 224,415
Accrued postretirement benefits 2,821,520 2,812,690
SHAREHOLDERS' EQUITY
Common Stock, no par value:
Authorized shares - 25,000,000
Issued and outstanding shares: 6,136,122 8,272,614
1997-2,594,207; 1996-2,716,214
(Excluding shares in treasury:
1997-798,978; 1996-610,987)
Preferred Stock, no par value
Authorized Shares - 2,000,000
(No shares issued)
Unearned compensation (266,563) (200,938)
Retained earnings 22,978,729 21,282,830
----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $46,696,914 $42,492,234
=========== ===========
</TABLE>
See accompanying notes.
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<TABLE>
<CAPTION>
THE EASTERN COMPANY
CONSOLIDATED CONDENSED STATEMENTS OF INCOME (UNAUDITED)
NINE MONTHS ENDED THREE MONTHS ENDED
<S> <C> <C> <C> <C>
Sept. 27, 1997 Sept. 28, 1996 Sept. 27, 1997 Sept. 28, 1996
-------------- -------------- -------------- --------------
Net sales $ 49,517,523 $ 43,607,683 $ 16,663,855 $ 13,715,095
Interest income 101,570 90,474 31,623 19,944
---------- ----------- ---------- ----------
Total 49,619,093 43,698,157 16,695,478 13,735,039
Cost of products sold 36,380,886 34,392,039 11,967,049 10,158,049
---------- ---------- ---------- ----------
13,238,207 9,306,118 4,728,429 3,576,990
Selling and administrative expenses 9,078,659 8,150,778 2,984,304 2,800,803
Interest expense 215,877 116,021 81,782 42,355
---------- ---------- ---------- ----------
INCOME BEFORE INCOME TAXES 3,943,671 1,039,319 1,662,343 733,832
Income taxes 1,429,311 385,348 595,346 254,403
---------- ---------- ---------- ----------
NET INCOME $ 2,514,360 $ 653,971 $ 1,066,997 $ 479,429
========== ========== ========== ==========
Net income per share $ 0.93 $ 0.24 $ 0.40 $ 0.18
Cash dividends per share $ 0.345 $ 0.345 $ 0.115 $ 0.115
Average shares outstanding 2,707,281 2,697,559 2,707,281 2,697,559
See accompanying notes.
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</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE EASTERN COMPANY
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
NINE MONTHS ENDED
<S> <C> <C>
Sept. 27, 1997 Sept. 28, 1996
OPERATING ACTIVITIES:
Net income $ 2,514,360 $ 653,971
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 2,221,806 2,211,386
Loss on sale of equipment and other assets 2,335 335
Postretirement benefits other than pensions 8,830 9,000
Provision for losses on accounts receivable 111,497 39,011
Issuance of Common Stock for directors' fees 43,956 -
Changes in operating assets and liabilities:
Accounts receivable (3,267,776) (499,271)
Inventories (996,706) 336,792
Prepaid expenses 287,512 172,977
Prepaid pension (153,095) (932,140)
Accounts payabl 1,211,436 (351,919)
Accrued expense 2,295,191 807,172
Other assets (300,219) (376,106)
---------- ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES 3,979,127 2,071,208
INVESTING ACTIVITIES:
Purchases of property, plant, and equipment (1,527,273) (2,348,758)
Proceeds from sale of equipment and other assets 46,283 13,600
---------- ---------
NET CASH USED BY INVESTING ACTIVITIES (1,480,990) (2,335,158)
FINANCING ACTIVITIES:
Payment of short term debt (500,000) -
Proceeds from short term borrowing 2,000,000 1,500,000
Principal payments on long-term debt and notes payable (125,777) (109,439)
Proceeds from sales of Common Stock 594,153 28,125
Purchases of Common Stock for the treasury (2,840,226) -
Dividends paid (930,986) (930,911)
---------- ---------
NET CASH (USED) PROVIDED BY FINANCING ACTIVITIES (1,802,836) 487,775
Effect of exchange rate changes on cash (3,840) 853
---------- ---------
NET INCREASE IN CASH AND CASH EQUIVALENTS 691,461 224,678
Cash and cash equivalents at beginning of year 2,269,031 1,521,361
--------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 2,960,492 $ 1,746,039
========== =========
</TABLE>
See accompanying notes. -4-
<PAGE>
<TABLE>
<CAPTION>
THE EASTERN COMPANY AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER SHARE (UNAUDITED)
NINE MONTHS ENDED THREE MONTHS ENDED
<S> <C> <C> <C> <C>
Sept. 27, 1997 Sept. 28, 1996 Sept. 27, 1997 Sept. 28, 1996
-------------- -------------- -------------- --------------
Primary:
Average shares outstanding 2,707,281 2,697,559 2,707,281 2,697,559
Net effect of dilutive stock
options -- based on the
treasury stock method
using average market price 34,704 33,996 34,704 33,996
---------- ---------- ---------- ----------
Total 2,741,985 2,731,555 2,741,985 2,731,555
========== ========== ========== ==========
Net income $ 2,514,360 $ 653,971 $ 1,066,997 $ 479,429
========== ========== ========== ==========
Net income per share $0.92 $0.24 $0.39 $0.18
===== ===== ===== =====
Fully diluted:
Average shares outstanding 2,707,281 2,697,559 2,707,281 2,697,559
Neteffect of dilutive stock
options -- based on the
treasury stock method
using quarter-end market
price, if higher than average
market price
43,885 40,763 43,885 40,763
---------- ---------- ---------- ----------
Total 2,751,166 2,738,322 2,751,166 2,738,322
========== ========== ========== ==========
Net income $ 2,514,360 $ 653,971 $ 1,066,997 $ 479,429
========== ========== ========== ==========
Net income per share $0.91 $0.24 $0.39 $0.18
===== ===== ===== =====
</TABLE>
See accompanying notes.
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<PAGE>
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
September 27, 1997
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 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.
The condensed balance sheet as of December 28, 1996 has been derived from the
audited financial statements at that date.
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: 1997 - 2,707,281 shares; 1996 - 2,697,559
shares. Common stock equivalents (stock options) did not have a material
dilutive effect on net income per share. Net income per share of common stock on
a fully diluted basis was not materially different.
For the year ending January 3, 1998 and periods thereafter the Registrant will
be required to adopt FASB Statement No. 128 "Earnings Per Share". The adoption
of this standard is not expected to have a significant impact on earnings per
share.
Note C - Litigation
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>
ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Results of Operations
Net income for the third quarter 1997 was $1.067 million or $.40 per share on
sales of $16.7 million versus net income for the third quarter of 1996 of $479
thousand or $.18 per share on sales of $13.7 million. Net income for the first
nine months of 1997 was $2.5 million or $.93 per share on sales of $49.5 million
versus net income for the first nine months of 1996 of $654 thousand or $.24 per
share on sales of $43.6 million. With these improved earnings the Registrant
increased its quarterly dividend from $0.115 per share to $0.13 per share
payable December 15, 1997 to stockholders of record November 28, 1997. The
annual dividend will increase from $0.46 to $0.52 per share.
Third quarter sales were up 21.5% compared to the same period a year ago. Volume
increased 16.2%, new product sales increased 3% and prices were up 2.3%. For the
first nine months of 1997 sales were 13.6% greater than the comparable period
last year. Volume increased 8.3% while price increases and new product sales
were up 3% and 2.3%, respectively. Increased volume, favorable product mix and
greater utilization of productive capacity resulted in more than doubling of net
income in the third quarter compared to the third quarter of 1996. Sales of the
Registrant's expansion shells, used in the underground mining industry increased
51% in the third quarter vs. the same period a year ago and were up 28% for the
first nine months 1997 vs. the first nine months of 1996. The increased mining
business is the direct result of the long-term supply agreement entered into
with the nation's largest manufacturer of mine roof bolts, Excel Mining Systems.
The Registrant's lock business was especially strong in the third quarter where
sales were up 29% vs. the third quarter of 1996 and they were up 13% for the
first nine months vs. the comparable period a year ago. New lock applications
specifically designed for leading computer manufacturers contributed 18% in
increased sales volume in the third quarter and is expected to approximate the
same volume in the fourth quarter 1997. Demand for the Registrant's heavy
hardware, servicing the tractor trailer industry was up approximately 11% for
the first nine months of 1997 vs. the nine month period of 1996. Fourth quarter
sales of heavy hardware are expected to show continued improvement with
additional new business anticipated in the first quarter of 1998. Sales of
industrial hardware were up 11% in the third quarter vs. the third quarter of
1996 and are expected to continue to remain strong. New products offered by the
Registrant include vehicular products designed and produced by the Eberhard
Manufacturing division and malleable casting products manufactured by the Frazer
& Jones division. The Registrant's CCL Security Products division recently
introduced two new PrestoLocks to the soft luggage markets to further enhance
our position in that market. A new keyless, three wheel padlock features a
convenient snap-action locking method as opposed to the conventional padlock
type of shackle motion. A new keyless, two wheel padlock is targeted for the
lower priced segment of the lock market. Deliveries of both locks are expected
to commence in early November. CCL Security also produces the keyless "Gun Blok"
lock, a patented combination trigger lock that fits virtually all firearms and
helps prevent their unauthorized use. Recent developments in the firearms
industry indicates several large gunmakers will be including a tamper proof
child safety lock with firearms to head off possible legislation that might
impose more stringent standards. Either of these activities could lead to a
significant increase in the potential size of the gunlock market if
manufacturers decide to buy the product from outside vendors as opposed to
making a lock in house. New gun locking mechanisms are currently being developed
to further enhance our position in this market.
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<PAGE>
The Registrant anticipates a continued strong performance in the fourth quarter.
The Registrant's gross margin as a percentage of sales for the three and nine
months ended September 27, 1997 was 28% and 27%, respectively, compared to 26%
and 21% for comparable periods a year ago. The improvement in gross margin in
1997 for the nine month period versus the comparable period a year ago is due
mainly to increased sales volume and more efficient utilization of production
facilities.
Third quarter selling and administrative expenses were up 6.6% or $184 thousand
from the same period a year ago and up 11% or $928 thousand for the nine months
1997 vs. the same period a year ago. Selling and administrative expenses would
have been lower in the third quarter of 1997 however, the Registrant accrued
$325 thousand in excess of insurance reimbursements for environmental matters.
Year to date expenses were up due to the environmental accrual, legal expenses
in connection with the environmental suits, defense costs incurred in the
first quarter proxy contest and one time charges in connection with the early
retirement of the Company's former Chief Executive Officer in the first half of
1997.
Liquidity and Sources of Capital
Cash flows from operations were $3.979 million for the first nine months of 1997
versus $2.071 million for the first nine months of 1996. The change in cash
flows resulted primarily from timing differences for collections of accounts
receivable, payments of liabilities, an increase in inventory and an increase in
net income attributed to increased sales. In addition to cash flow from
operations, which was sufficient to fund normal operating activities, the
Registrant drew down an additional $2 million on its short-term line of credit
to help fund the purchase of 159,118 shares of company stock for the treasury
during the third quarter.
Additions to property, plant and equipment were $1.5 million during the first
nine months of 1997 versus $2.3 million for the comparable period a year ago.
Total 1997 capital expenditures are expected to be lower than the anticipated
$2.6 million level of depreciation for the year.
Inventory balances at the end of the third quarter of 1997 of $11.9 million were
$1.0 million higher than year end 1996, and $0.4 million lower than the third
quarter of 1996. Inventory turns of 4.1 times at the end of the third quarter of
1997 were comparable to both the previous year end rate and the third quarter of
1996. Accounts receivable at the end of the third quarter 1997 were $10.1
million which was $3.1 million higher than year end and $1.8 million higher than
the third quarter of 1996. The average day's sales in accounts receivable was 55
days at the end of the third quarter 1997 which was comparable to the
corresponding period of a year ago. The increase in accounts receivable was
driven by increases in sales volume.
Following the close of the third quarter, improved operating cash flow has
allowed the Registrant to pay down $500 thousand of its short-term debt. The
Registrant anticipates additional pay downs on its short-term borrowings during
the fourth quarter.
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<PAGE>
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. A
final judgement was entered by the US District Court in the consolidated
proceedings on March 17, 1995. Appeals, however, were filed by two government
agencies as described in Part II, Item 1 below.
On November 1, 1996, the United States Court of Appeals for the Second Circuit
reversed the US District Court's ruling dismissing government agencies
environmental claims against the Registrant and certain other defendants, and
the environmental claims by Laurel Park and Beacon Heights Coalitions against
numerous defendants. The Court of Appeals, is expected to remand 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.
NOTE: This document contains forward looking statements, within the meaning of
the Private Securities Litigation Reform Act of 1995, which reflect the
Registrant's current expectations regarding its future operating performance in
the mining industries, tractor trailer markets, industrial hardware industries,
firearms accessories markets and the security products industry where the
Registrant markets its products and services, including statements about plans
and expectations regarding products and future financial results.
Forward-looking statements involve risks and uncertainties which may cause the
Registrant's actual results in future periods to differ materially from those
expressed. These uncertainties and risks include changing customer preferences,
lack of success of new products, loss of the Company's customers, competition,
and other factors discussed from time to time in the Registrant's filings with
the Securities and Exchange Commission.
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<PAGE>
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.
The Registrant has filed answers to both the EPA Complaint and the Beacon
Coalition Complaint.
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).
The Registrant filed answers to both of these complaints.
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.
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<PAGE>
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.
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
will 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 has filed 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.
After rejecting motions for rehearing, the Court of Appeals returned the cases
to the US District Court. On July 21, 1997, the District Court issued an order
appointing a Special Master to mediate, find facts if necessary and report back
to the court within six months as to all remaining claims for contribution. The
Registrant is actively participating in this process as it pertains to the EPA
and State Claims against the Registrant and the Registrant's contribution rights
against third-party defendants.
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.
-11-
<PAGE>
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
- ------- --------------------------------
B. Reports on Form 8-K
None
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, 1997 /S/ LEONARD F. LEGANZA
----------------- -----------------------------
Leonard F. Leganza
President and Chief Executive Officer
DATE: November 12, 1997 /S/ DONALD E. WHITMORE JR.
----------------- ------------------------------
Donald E. Whitmore, Jr., Executive Vice
President and Chief Financial Officer
-12-
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-28-1996
<PERIOD-END> SEP-27-1997
<CASH> 2960492
<SECURITIES> 0
<RECEIVABLES> 10148169
<ALLOWANCES> 678000
<INVENTORY> 11874468
<CURRENT-ASSETS> 26981500
<PP&E> 27412085
<DEPRECIATION> 14000314
<TOTAL-ASSETS> 46696914
<CURRENT-LIABILITIES> 12543893
<BONDS> 0
0
0
<COMMON> 6136122
<OTHER-SE> 22712166
<TOTAL-LIABILITY-AND-EQUITY> 46696914
<SALES> 49517523
<TOTAL-REVENUES> 49619093
<CGS> 36380886
<TOTAL-COSTS> 36380886
<OTHER-EXPENSES> 8967162
<LOSS-PROVISION> 111497
<INTEREST-EXPENSE> 215877
<INCOME-PRETAX> 3943671
<INCOME-TAX> 1429311
<INCOME-CONTINUING> 2514360
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2514360
<EPS-PRIMARY> .92
<EPS-DILUTED> .91
</TABLE>
