<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 26, 1998
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE TRANSITION PERIOD FROM _______________TO_______________
Commission File Number: 0-9856
AM COMMUNICATIONS, INC.
---------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Delaware 23-1922958
- ------------------------------- ----------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
100 Commerce Boulevard, Quakertown, PA 18951-2237
- -------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(215) 538-8700
--------------
(Issuer's Telephone Number)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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
--- ---
On October 30, 1998, there were 31,072,296 shares of the Registrant's Common
Stock, par value $.10 per share, outstanding.
<PAGE>
AM COMMUNICATIONS, INC.
FORM 10-QSB
FOR THE QUARTER ENDED SEPTEMBER 26, 1998
INDEX
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION PAGE NO.
- ------- --------------------- --------
<S> <C> <C>
Item 1. Financial Statements
Balance Sheets -- September 26 (Unaudited) and
March 28, 1998 3
Statements of Operations - Quarters and Six Months Ended
September 26, 1998 and September 27, 1997 (Unaudited) 4
Statements of Cash Flows -- Six Months Ended
September 26, 1998 and September 27, 1997 (Unaudited) 5
Notes to Financial Statements 6, 7
Item 2. Management's Discussion and Analysis of Operations 8 - 12
PART II. OTHER INFORMATION
- -------- -----------------
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 13
</TABLE>
2
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Item 1. Financial Statements
- -----------------------------
AM COMMUNICATIONS, INC.
BALANCE SHEETS
<TABLE>
<CAPTION>
September 26, March 28,
1998 1998
------------ ------------
(Unaudited)
<S> <C> <C>
ASSETS
Current Assets:
Cash $ 166,000 $ 710,000
Accounts Receivable, Net of Reserves of $32,000
at September 26 and March 28, 1998 1,707,000 1,851,000
Inventory 1,648,000 2,073,000
Prepaid Expenses and Other 72,000 63,000
------------ ------------
Total Current Assets 3,593,000 4,697,000
Equipment and Fixtures, Net 527,000 734,000
Other Assets 18,000 19,000
------------ ------------
Total Assets $ 4,138,000 $ 5,450,000
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current Portion of Capital Lease Obligations $ 73,000 $ 108,000
Current Portion of Notes Payable 30,000 --
Accounts Payable 1,070,000 991,000
Advances -- 194,000
Accrued Expenses 961,000 987,000
------------ ------------
Total Current Liabilities 2,134,000 2,280,000
------------ ------------
Capital Lease Obligations - Long Term 2,000 39,000
Notes Payable - Long Term 105,000 --
Senior Convertible Redeemable Preferred Stock,
$100 Par Value, Authorized 1,000,000 Shares;
Issued and Outstanding 25,825 Shares at
September 26 and March 28, 1998 2,583,000 2,583,000
------------ ------------
Commitments and Contingencies
Stockholders' Equity:
Common Stock, $.10 Par Value, Authorized 50,000,000
Shares at September 26 and March 28, 1998; Issued
and Outstanding 31,072,296 Shares at September 26
and March 28, 1998 3,107,000 3,107,000
Capital in Excess of Par 31,269,000 31,269,000
Accumulated Deficit (35,062,000) (33,828,000)
------------ ------------
Stockholders' Equity (Deficit) (686,000) 548,000
------------ ------------
Total Liabilities and Stockholders' Equity $ 4,138,000 $ 5,450,000
============ ============
</TABLE>
See Notes to Financial Statements
3
<PAGE>
AM COMMUNICATIONS, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
September 26, September 27, September 26, September 27,
1998 1997 1998 1997
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues $ 2,415,000 $ 4,096,000 $ 4,853,000 $ 7,649,000
Cost and Expenses:
Cost of Sales 1,500,000 2,194,000 2,775,000 3,964,000
Selling, General and Administrative 610,000 616,000 1,359,000 1,185,000
Research and Development 912,000 918,000 1,952,000 1,975,000
------------ ------------ ------------ ------------
Operating Income (Loss) (607,000) 368,000 (1,233,000) 525,000
Other Expense 2,000 11,000 1,000 19,000
------------ ------------ ------------ ------------
Income (Loss) Before Income Taxes (609,000) 357,000 (1,234,000) 506,000
Income Tax Provision -- -- -- --
------------ ------------ ------------ ------------
Net Income (Loss) $ (609,000) $ 357,000 $ (1,234,000) $ 506,000
============ ============ ============ ============
Basic Net Income (Loss) Per Share $ (0.02) $ 0.01 $ (0.04) $ 0.01
============ ============ ============ ============
Diluted Net Income (Loss) Per Share $ (0.02) $ 0.01 $ (0.04) $ 0.01
============ ============ ============ ============
Shares Used in Computation of Basic
Net Income (Loss) Per Share 31,072,000 31,052,000 31,072,000 31,052,000
============ ============ ============ ============
Shares Used in Computation of Diluted
Net Income (Loss) Per Share 31,072,000 34,187,000 31,072,000 34,142,000
============ ============ ============ ============
</TABLE>
See Notes to Financial Statements
4
<PAGE>
AM COMMUNICATIONS, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
September 26, September 27,
1998 1997
----------- -----------
<S> <C> <C>
Cash Flows from Operating Activities:
Net Income (Loss) $(1,234,000) $ 506,000
Adjustments to Reconcile Net Income (Loss) to
Net Cash Provided By (Used in) Operating Activities:
Depreciation and Amortization 241,000 266,000
Changes in Assets and Liabilities Which
Provided (Used) Cash:
Accounts Receivable 144,000 (1,125,000)
Inventory 425,000 (377,000)
Prepaid Expenses and Other (19,000) (33,000)
Accounts Payable 79,000 53,000
Advances (194,000) 1,000
Accrued and Other Expenses (26,000) 76,000
----------- -----------
Net Cash Used In Operating Activities (584,000) (633,000)
----------- -----------
Cash Flows From Investing Activities:
Purchase of Equipment and Intangible Assets (23,000) (156,000)
----------- -----------
Net Cash Used In Investing Activities (23,000) (156,000)
----------- -----------
Cash Flows from Financing Activities:
Net Proceeds from Borrowings on Bank Line of Credit -- 395,000
Proceeds from Note Payable 135,000 --
Exercise of Warrants and Stock Options -- 3,000
Payments Under Capital Lease Obligations (72,000) (68,000)
----------- -----------
Net Cash Provided By Financing Activities 63,000 330,000
----------- -----------
Net Decrease In Cash (544,000) (459,000)
Cash:
Beginning 710,000 620,000
----------- -----------
Ending $ 166,000 $ 161,000
=========== ===========
Interest Paid $ 8,000 $ 21,000
=========== ===========
Income Taxes Paid $ -- $ --
=========== ===========
</TABLE>
See Notes to Financial Statements
5
<PAGE>
AM COMMUNICATIONS, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
As of September 26, 1998 and for The 26 Week Periods Ended
September 27, 1997 and September 26, 1998
1. The accompanying interim financial statements should be read in conjunction
with the annual financial statements and notes thereto included in AM
Communications, Inc.'s Annual Report. The Balance Sheet as of September 26,
1998 and the related Statements of Operations and Statements of Cash Flows
for the quarters and six months ended September 26, 1998 and September 27,
1997 are unaudited, but in the opinion of management include all normal and
recurring adjustments necessary for a fair statement of the results for such
interim periods.
September 26, March 28,
1998 1998
----------- -----------
(Unaudited)
2. Inventory Comprises:
Raw Material $ 1,951,000 $ 2,171,000
Work in Process 775,000 937,000
Finished Goods 137,000 180,000
----------- -----------
2,863,000 3,288,000
Inventory Reserves (1,215,000) (1,215,000)
----------- -----------
Net Inventory $ 1,648,000 $ 2,073,000
=========== ===========
3. Accrued Expenses Comprise:
Accrued Compensation $ 421,000 $ 462,000
Accrued Rent 190,000 180,000
Accrued Real Estate Taxes 15,000 29,000
Warranty Reserve 203,000 203,000
Accrued Income Taxes 32,000 32,000
Accrued Professional Fees 45,000 60,000
Other 55,000 21,000
----------- -----------
$ 961,000 $ 987,000
=========== ===========
6
<PAGE>
4. Income Taxes:
The Company accounts for income taxes in accordance with Statement of
Financial Accounting Standards ( "SFAS") No. 109.
The provision for taxes on income consisted of:
Six Months Ended
-------------------------------
September 26, September 27,
1998 1997
--------- ---------
Current Income Taxes $ -- $ --
Deferred Income Taxes (508,000) 85,000
Change in Valuation Allowance 508,000 (85,000)
--------- ---------
Net $ -- $ --
========= =========
A reconciliation between the provision (benefit) for income taxes, computed
by applying the statutory federal income tax rate of 34% to income before income
taxes and the actual provision for income taxes follows:
Six Months Ended
-----------------------------
September 26, September 27,
1998 1997
--------- ---------
Federal Income Tax Provision (Benefit) at
Statutory Rate $(420,000) $ 172,000
State Income Taxes, Net of Federal Benefit (80,000) 33,000
Research and Development Credits (10,000) (25,000)
Permanent Differences 2,000 2,000
Change in Valuation Allowance 508,000 (85,000)
Other -- (97,000)
--------- ---------
Income Tax Provision $ -- $ --
========= =========
The components of the net deferred tax asset as of September 26 and March
28 were as follows:
September 26, March 28,
1998 1998
----------- -----------
Deferred Tax Items:
Inventory $ 493,000 $ 493,000
Accrued Expenses and Reserves 173,000 155,000
Net Operating Loss Carryforwards 8,242,000 7,761,000
Tax Credit Carryforwards 757,000 748,000
Valuation Allowance (9,665,000) (9,157,000)
----------- -----------
Net Deferred Tax Assets $ -- $ --
=========== ===========
The Company has total net operating loss carryforwards available to
offset future taxable income of $24.5 million expiring at various times from
1998 to 2012. Due to certain statutory limitations under Internal Revenue Code
Section 382, a portion of such carryforwards may not be available or may expire
before being utilized.
7
<PAGE>
Item 2. Management's Discussion and Analysis of Operations
- ----------------------------------------------------------
The following discussion contains "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. These forward-looking
statements represent the Company's present expectations or beliefs concerning
future events. The Company cautions that such statements are subject to certain
risks and uncertainties that could cause actual results to differ materially
from historical results or anticipated results. Potential risks and
uncertainties include, without limitation, the impact of economic conditions
generally; the competitive nature of the CATV network monitoring market; the
Company's ability to enhance its existing products and develop and introduce new
products which keep pace with technological developments in the marketplace; and
market demand.
The following discussion should be read in conjunction with the Company's Form
10-KSB for its year ended March 1998.
General
AM Communications is a provider of high technology system level products for the
broadband communications industry, primarily for network monitoring of CATV
transmission systems.
As disclosed in the Company's Form 10-KSB for the fiscal year ended March 28,
1998, the Company experienced a drop in the backlog of open orders during the
end of its 1998 fiscal year. The order slow down was due primarily to the lack
of re-orders related to two major accounts which contributed 34% and 18% of
fiscal 1998 revenues. In both situations, the customers have placed their
capital programs involving the purchase of the Company's products on hold
pending re-evaluation of the program. The Company is unable to determine if
future orders will be forthcoming from these customers and as a result expects
that revenues for fiscal 1999 will be significantly below revenues for fiscal
1998 and that the Company will incur substantial operating losses during fiscal
1999. The Company has taken several actions to address this situation including
restructuring its sales and marketing activities by adding additional direct
sales staff, aggressively supporting new customer and OEM installations and
reducing operating costs by implementing staffing reductions.
Results of Operations
- ---------------------
Quarter 2 Fiscal 1999 vs. 1998
- ------------------------------
Quarter 2 Quarter 2
Fiscal 1999 Fiscal 1998
----------- -----------
Revenues 100.0% 100.0%
Cost of Sales 62.1 53.6
Selling, General and Administrative 25.3 15.0
Research and Development 37.8 22.4
------ ----
Operating Income (Loss) (25.2) 9.0
8
<PAGE>
Revenues
Revenues for the second quarter of fiscal 1999 ended September 26, 1998 were
$2.4 million and $4.1 million for the first six months of fiscal 1999,
representing a 41% and 36.6% decline, respectively, compared to the prior year
periods. The decline in revenues is due primarily to the previously described
drop-off of revenues from two key customers. In addition, the Company and its
OEM partners have experienced a slow down in new order activity due to the
international financial problems impacting infrastructure spending and a
slow-down in domestic spending related to end of the year budget cycles. The
Company has refocused its selling efforts which have identified new
opportunities, however, such opportunities are subject to the risks and
uncertainties during the sales cycle in closing new business. The Company
continues to maintain key strategic OEM relationships with General Instrument,
Philips, and Scientific-Atlanta. Backlog at September 26, 1998 was $1.6 million
compared to $6 million a year ago.
Development and software revenues totaled $485,000 and $459,000 in the second
quarter of fiscal 1999 and 1998, respectively and $725,000 and $611,000 in the
first six months of fiscal 1999 and 1998, respectively. Development revenues
primarily relate to OEM development efforts which are recognized when defined
milestones are reached, the timing of which may be different from when the
related development expenses were incurred. The related development costs are
reported as research and development expense. All software development costs are
charged to research and development when incurred.
Cost of Sales
Costs of sales includes manufacturing costs of the Company's hardware products.
Cost of sales represented 62.1% of revenues in the second quarter of fiscal 1999
compared to 53.6% in the second quarter of fiscal 1998 and 57.2% and 51.8% in
the first six months of fiscal 1999 and 1998, respectively. The increase in cost
of sales percentage is due to manufacturing variances incurred with lower volume
of revenues during the first quarter of fiscal 1999, and in the second quarter
of fiscal 1999 also due to a change in the mix of products related to completion
of several projects with lower margin. The Company's margins are generally
dependent on product mix and customer mix, with sales to OEM customers generally
having a lower profit margin.
Selling, General and Administrative
Selling, general and administrative (S,G&A) expenses were $610,000 and $616,000
in the second quarter of fiscal 1999 and fiscal 1998, respectively and $1.4
million and $1.2 million for the first six months of fiscal 1999 and 1998,
respectively. Expenses increased in fiscal 1999 due to increased costs related
to staff reductions and restructuring of the sales and marketing function
including added staff and promotion expenses which occurred in the first quarter
of fiscal 1999. The Company expects S,G & A expenses to decline during fiscal
1999 as a result of recently implemented staffing reductions.
Research and Development
Research and development expense totaled approximately $900,000 for the second
quarters of both fiscal 1999 and 1998 and approximately $2 million for the first
six months of both fiscal 1999 and 1998. The Company continues to spend a
significant amount on research and development as it focuses on upgrading and
expanding the OmniStat(TM) status monitoring system including software and
performance monitoring
9
<PAGE>
products needed to remain competitive. The Company continues to identify product
development needs in excess of its available development resources which has
negatively impacted its competitive position.
In November 1998, the Company announced a new strategic development relationship
with Network Systems & Technologies Ltd. (NeST). NeST is a provider of system
solutions and electronic manufacturing resources located in Southwest India.
Under the agreement, AM will integrate the NeST technology resources as a
dedicated part of its engineering organization. Engineering efforts at the
Company's headquarters will continue to focus on product specification,
technical customer support and project management. NeST will perform design and
development, predominately in India. The Company also expects to utilize the
NeST manufacturing resources on a turn-key basis to reduce manufacturing costs
of products. The Company has the option of paying for development services in
cash or AM stock. As a result of the NeST relationship, the Company expects to
increase its development staff working on critical programs, reduce its present
cash outlays for its development as initial development will be funded with AM
stock, and identify manufacturing cost reductions as product manufacturing is
transferred to India.
Operating Income (Loss)
The Company experienced operating losses of $609,000 in the second quarter of
fiscal 1999 and $1.2 million for the first six months of fiscal 1999 primarily
due to a significant drop-off of revenues as previously described. The Company
has reduced its annual operating costs going forward primarily through staff
reductions. Should the Company's revenue levels not improve, further operating
losses would be incurred and the Company would expect to further reduce
operating costs to minimize such losses.
Income Taxes
Due to the significant net operating loss carry-forward, the Company is subject
to minimum income taxes which include state income taxes and federal income
taxes based on an "alternative minimum tax" calculation.
Industry Factors
The cable and broadband communications industry is undergoing significant change
as cable television (CATV) operators continue to expand and consolidate their
operations. Operators are also implementing new interactive services such as
video on demand, Internet access and telephony. In addition, competition for
video services has increased with new entrants, including telephone and
satellite providers. This has resulted in existing CATV operators planning to
expand and upgrade their distribution infrastructures and new providers planning
to construct new distribution systems capable of providing a mix of services.
There continue to be many unresolved issues and uncertainties impacting this
convergence of CATV and telecommunications industries, including governmental
regulations, competing distribution technologies, and significant capital costs.
Demand for CATV network monitoring products has generally increased as
monitoring of cable distribution systems has become an important factor in
increasing operating efficiency and reliability. However, the Company's
operations are subject to the timing and success of new product introductions,
the scheduling of orders by customers and the Company's ability to support its
technology in the field. In the past, the Company
10
<PAGE>
has experienced technical field problems primarily with its software product,
which has required the Company to incur added expenses in field applications and
development and which has impacted new selling efforts. The Company also
continues to identify product development needs in excess of its available
development resources, which has negatively impact its competitive position.
While the Company's new relationship with NeST is expected to improve the
Company's ability to introduce new products and its competitive position,
improvement in the Company's operating position is dependent on timely
transition to NeST of critical development programs and the successful
introduction of new technology products.
Due to the effects of these factors on future operations, past performance is a
limited indicator in assessing potential future performance which could impact
the trading price of the Company's common stock.
Liquidity and Capital Resources
- -------------------------------
In the first six months of fiscal 1999, the Company consumed net cash of
$544,000 compared to consuming cash of $459,000 during the comparable period in
fiscal 1998.
As of September 26, 1998, the Company's cash totaled $166,000 compared to
$710,000 at March 28, 1998. As discussed above, the Company expects to incur
operating losses during fiscal 1999 as a result of a decline in order bookings,
though it has taken aggressive steps to reduce the ongoing cash requirements.
The Company believes that existing cash and available lending lines, combined
with recent operating expense and staff reductions and the NeST relationship, is
sufficient to support operations over this time period. Should operating losses
continue or exceed planned levels, the Company would expect to further reduce
operating expenses, including additional staff reductions, to allow continued
operation of the business. The Company is also evaluating the need to raise
additional capital. There can be no assurance that such additional capital would
be available.
During the quarter ended September 26, 1998, the Company received $135,000 in
proceeds of a $150,000 technology improvement fund loan from the Ben Franklin
Technology Center of Southeastern Pennsylvania. The loan is for the development
of the Company's OmniVu 2000 software package. The loan principal is payable in
quarterly installments of $7,500 over the next five years. Interest is payable
quarterly contingent on the commercial success of the product in an amount equal
to 3% of the product sales for the immediately preceding quarter until a
cumulative amount equal to fifty-percent of the loan has been repaid.
In September 1997, the Company received a working capital line of credit from a
commercial bank to provide up to $1 million based on the value of accounts
receivable. Under terms of the agreement, all the Company's assets are pledged
and interest is payable at 1 1/2% above prime. The Company borrowed up to
$612,000 under this line during fiscal 1998, which was repaid, and no amounts
were outstanding at March 28, 1998. The line of credit expired July 31, 1998 and
the Company received a commitment letter extending the line at a reduced level
of $750,000 through July 30, 1999. The Company also received up to a $250,000
commitment from its primary shareholder to provide working capital through July
1999 at 10% interest and payment of outstanding borrowings due by September 30,
1999.
Capital expenditures totaled $23,000 in the first six months of fiscal 1999 and
$156,000 in the comparable period of fiscal 1998 which include capital leases,
computers, manufacturing assembly and test equipment and facility related
improvements and fixtures.
11
<PAGE>
Change in Management Structure
The Company announced the appointment of Javad (Jay) K. Hassan as a director and
Chairman of the Board in November 1998. Mr. Hassan was instrumental in the
establishment of Network Systems & Technologies (NeST), a provider of software
and system solutions located in India which will provide development resources
to expedite the Company's critical development programs in a more cost effective
manner. Mr. Hassan will be taking an active role as Chairman with the goal of
expanding the Company's focus into other communication system areas, as well as
re-establishing growth in the network monitoring area.
Impact of the Year 2000 Issue
The Year 2000 Issue is the result of computer programs being written using two
digits rather than four to define the applicable year. Any of the Company's
computer programs that have date-sensitive software may recognize a date using
"00" as the year 1900 rather than the year 2000. This could result in a system
failure or miscalculations causing disruption of operations, including among
other things, a temporary inability to process transactions, send invoices, or
engage in similar normal business activities.
The Company believes that it has minimal exposure to contingencies related to
the Year 2000 Issue for the products it has sold.
The Company has determined that its internal reporting system will not properly
utilize dates beyond December 31, 1999. A plan has been initiated to implement a
replacement software system. Management expects this software system will be
installed and fully operational during 1999. The anticipated cost of this
project is $150,000.
The Company plans to engage in formal communication with all of its significant
suppliers and large customers to determine the extent to which the Company is
vulnerable to those third parties' failure to remediate their own Year 2000
Issue. There can be no guarantee that the systems of other companies on which
the Company's systems rely or interface with will be timely converted, or that a
failure to convert by another company, or a conversion that is incompatible with
the Company's systems, would not have a material adverse effect on the Company.
PART II. OTHER INFORMATION
Item 5. Other Information
--------------------------
Stockholder Proposals: Stockholder proposals intended to be considered at
the 1999 Annual Meeting of Stockholders and which the proponent would like to
have included in the proxy materials distributed by the Company in connection
with such meeting, pursuant to Rule 14a-8 promulgated under the Securities
Exchange Act of 1934, as amended (the "1934 Act"), must be received at the
principal executive offices of the Company no later than 120 calendar days in
advance of the date in 1999 corresponding to the date in 1998 on which the
Company's proxy material were first mailed to the Company's stockholders in
connection with the Company's 1998 Annual Meeting of Stockholders. Such
proposals
12
<PAGE>
may be included in next year's proxy materials if they comply with certain rules
and regulations promulgated by the Securities and Exchange Commission.
Stockholder proposals intended to be considered at the 1999 Annual Meeting of
Stockholders and for which the proponent does not intend to seek inclusion of
the proposal in the proxy materials to be distributed by the Company in
connection with such meeting must be received at the principal executive offices
of the Company no later than forty-five calendar days prior to the date in 1999
corresponding to the date in 1998 on which the Company's proxy materials for the
Company's 1998 Annual Meeting of Stockholders were first mailed to the Company's
stockholders. Any stockholder proposal received after such date will not be
considered to be timely submitted for purposes of the discretionary voting
provisions of Rule 14a-4 promulgated under the 1934 Act. In accordance with Rule
14a-4( c ), the holders of proxies solicited by the Board of Directors of the
Company in connection with the Company's 1999 Annual Meeting of Stockholders may
vote such proxies in their discretion on certain matters as more fully described
in such Rule, including without limitation on any matter coming before the
meeting as to which the Company does not have notice on or before the
forty-fifth calendar day preceding the date in 1999 corresponding ot the date in
1998 on which the Company's proxy materials for the Company's 1998 Annual
Meeting of Stockholders were first mailed to the Company's stockholders.
Item 6. Exhibits and Reports on Form 8-K
-----------------------------------------
(b) No reports on Form 8-K have been filed for the period covered by this
report.
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.
AM COMMUNICATIONS, INC.
(Registrant)
Date: November 10, 1998 By: /s/ Keith D. Schneck
---------------------- ------------------------------------
Keith D. Schneck
President and Chief Financial Officer
13
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> APR-3-1999
<PERIOD-START> JUN-28-1998
<PERIOD-END> SEP-26-1998
<CASH> 166,000
<SECURITIES> 0
<RECEIVABLES> 1,707,000
<ALLOWANCES> 32,000
<INVENTORY> 1,648,000
<CURRENT-ASSETS> 3,593,000
<PP&E> 4,343,000
<DEPRECIATION> 3,816,000
<TOTAL-ASSETS> 4,138,000
<CURRENT-LIABILITIES> 2,134,000
<BONDS> 0
2,583,000
0
<COMMON> 3,107,000
<OTHER-SE> 31,269,000
<TOTAL-LIABILITY-AND-EQUITY> 4,138,000
<SALES> 2,415,000
<TOTAL-REVENUES> 2,415,000
<CGS> 1,500,000
<TOTAL-COSTS> 3,022,000
<OTHER-EXPENSES> (2,000)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,000
<INCOME-PRETAX> (609,000)
<INCOME-TAX> 0
<INCOME-CONTINUING> (609,000)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (609,000)
<EPS-PRIMARY> (0.02)
<EPS-DILUTED> (0.02)
</TABLE>
