U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
(Mark One)
|X| QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended July 3, 1999
|_| TRANSITION REPORT UNDER SECTION 13 or 15(d) OF THE EXCHANGE ACT
For the transition period from _____________to____________
Commission file number 0-122
EICO Electronic Instrument Co., Inc.
----------------------------------------------------
(Exact name of small business issuer as
specified in its charter)
New York 11-1524626
- ---------------------------------- ---------------------------------
(State or other jurisdiction (IRS Employer Identification No.)
of incorporation or organization)
233 Broadway, Suite 1085, New York, New York 10279
----------------------------------------------------
(Address of principal executive offices)
(212) 566-4995
----------------------------------------------------
(Issuer's telephone number)
----------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
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 report(s), and (2) has been
subject to such filing requirements for the past 90 days. Yes |X| No |_|
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes |_| No |_|
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: August 3, 1999
Capital stock - $1 par value - 598,307 shares outstanding.
<PAGE>
EICO ELECTRONIC INSTRUMENT CO., INC.
QUARTERLY REPORT ON FORM 10-QSB
FOR THE QUARTER ENDING JULY 3, 1999
- INDEX -
Part I - Financial Information:
Item 1 - Financial Statements
Balance sheet - July 3, 1999 (unaudited)
Statement of operations - for the thirty-nine
weeks and thirteen weeks ended July 3,
1999 and June 27, 1998 (unaudited)
Statement of cash flows - for the thirty-nine
weeks ended July 3, 1999 and June 27, 1998
(unaudited)
Notes to Form 10-QSB (unaudited)
Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of Operations
Signature Page
<PAGE>
Item 1. Financial Statements
EICO ELECTRONIC INSTRUMENT CO., INC.
BALANCE SHEET
AS AT JULY 3, 1999
(UNAUDITED)
ASSETS
Cash $ 40,649
Investment in U.S. Treasury money
market fund 2,648,384
Prepaid expenses 4,442
Investment in U.S. Treasury bills
(at amortized cost; which
approximates market) 1,216,514
Other assets 1,189
----------
TOTAL $3,911,178
==========
LIABILITIES
Accrued wages, taxes and other expenses $ 32,770
Income taxes payable 79,038
----------
Total liabilities 111,808
----------
STOCKHOLDERS' EQUITY
Capital stock - $1 par value - authorized
1,000,000 shares; issued 608,293 shares
(including treasury shares) 608,293
Additional paid-in capital 617,213
Retained earnings 2,601,110
----------
Total 3,826,616
Less cost of 9,986 shares capital
stock in treasury 27,246
----------
Total stockholders' equity 3,799,370
----------
TOTAL $3,911,178
==========
The attached notes are made a part hereof.
<PAGE>
EICO ELECTRONIC INSTRUMENT CO., INC.
STATEMENT OF OPERATIONS
(NOTES A AND B)
(UNAUDITED)
Thirty-Nine Thirteen
Weeks Ended Weeks Ended
----------------------- -----------------------
July 3, June 27, July 3, June 27,
1999 1998 1999 1998
--------- --------- --------- ---------
Income:
Interest on mortgage $ 29,822 $ 241,199 $ 80,011
Interest on
investments 127,423 37,544 $ 43,111 12,544
Gain on sale
of property 57,968 19,711
--------- --------- --------- ---------
Total 157,245 336,711 43,111 112,266
General and corporate
expenses 167,168 148,060 44,102 45,942
--------- --------- --------- ---------
Earnings (loss) before
income taxes (9,923) 188,651 (991) 66,324
Income tax provision
(credit) (2,000) 82,000 27,000
--------- --------- --------- ---------
NET EARNINGS (LOSS) $ (7,923) $ 106,651 $ (991) $ 39,324
========= ========= ========= =========
Net earnings (loss)
per share $ (.01) $ .18 $ -- $ .07
========= ========= ========= =========
Number of shares used
in computing net
earnings per share 598,307 600,380 598,307 600,380
========= ========= ========= =========
Dividends declared
per share None None None None
========= ========= ========= =========
The attached notes are made a part hereof.
Management's discussion and analysis of financial condition and
results of operations is included in item 2.
<PAGE>
EICO ELECTRONIC INSTRUMENT CO., INC.
STATEMENT OF CASH FLOWS
(UNAUDITED)
Thirty-Nine
Weeks Ended
----------------------------
July 3, June 27,
1999 1998
----------- -----------
Cash flows from operating activities:
Cash paid to suppliers and employees $ (216,296) $ (170,019)
Interest received 166,563 277,034
Income taxes paid (1,352,185) (65,270)
Late fee penalty collected 155,517
----------- -----------
Net cash provided by (used in)
operating activities (1,246,401) 41,745
----------- -----------
Cash flows provided by investing
activities:
Proceeds from sale of property -
collection of mortgage principal 3,974,124 57,968
Proceeds from redemption of U.S.
Treasury obligations 9,414,688 907,448
Investment in U.S. Treasury obligations (9,592,612) (1,033,009)
Investment in U.S. Treasury money
market fund (2,648,384)
----------- -----------
Net cash provided by (used in)
investing activities 1,147,816 (67,593)
-----------
Cash flows from financing activities -
dividends paid (120,076)
----------- -----------
NET (DECREASE) IN CASH (98,585) (145,924)
Cash - beginning of period 139,234 190,027
----------- -----------
CASH - END OF PERIOD $ 40,649 $ 44,103
=========== ===========
(Continued)
<PAGE>
EICO ELECTRONIC INSTRUMENT CO., INC.
STATEMENT OF CASH FLOWS
(UNAUDITED)
- Sheet 2 -
Thirty-Nine
Weeks Ended
-----------------------------
July 3, June 27,
1999 1998
----------- -----------
Reconciliation of net earnings to net
cash provided by operating activities:
Net earnings (loss) $ (7,923) $ 106,651
Adjustments to reconcile net
earnings (loss) to net cash provided
by (used in) operating activities:
Gain on the sale of property (57,968)
Deferred income taxes 7,000
Decrease (increase) in:
Mortgage interest and
penalty receivable 155,517
Prepaid expenses 9,318 (16,620)
Other costs 4,225 2,000
Increase (decrease) in:
Accrued wages, taxes and
other expenses (53,353) (9,048)
Income taxes payable (1,354,185) 9,730
----------- -----------
Net cash provided by (used in)
operating activities $(1,246,401) $ 41,745
=========== ===========
The attached notes are made a part hereof.
<PAGE>
EICO ELECTRONIC INSTRUMENT CO., INC.
NOTES TO FORM 10-QSB
(UNAUDITED)
(Note A):
The financial information contained in this Form 10-QSB represents
condensed financial data and, therefore, does not include all footnote
disclosures required to be included in financial statements prepared in
conformity with generally accepted accounting principles. Such footnote
information was included in the Company's annual Form 10-KSB for the year
ended October 3, 1998; the condensed financial data included herein should be
read in conjunction with the annual report.
(Note B):
(1) In management's opinion, all necessary adjustments have been made in
order to present fairly the results for the interim periods.
(2) The results of operations for the thirty-nine weeks ended July 3, 1999
are not necessarily indicative of the results of operations for the year ending
October 2, 1999.
(Note C):
Earnings per share is based on the average number of shares outstanding
during each period, exclusive of treasury shares.
(Note D):
Income taxes on the consolidated statement of operations comprises:
Thirty-Nine Thirteen
Weeks Ended Weeks Ended
--------------------- -------------------
July 3, June 27, July 3, June 27,
1999 1998 1999 1998
------- ------- ------- -------
Currently payable
(refundable):
Federal $(1,000) $46,000 $ -- $15,000
State and local (1,000) 29,000 10,000
Deferred:
Federal 4,000 1,000
State and local 3,000 1,000
------- ------- ------- -------
Total $(2,000) $82,000 $ -- $27,000
======= ======= ======= =======
(Continued)
<PAGE>
EICO ELECTRONIC INSTRUMENT CO., INC.
NOTES TO FORM 10-QSB
(UNAUDITED)
- Sheet 2 -
(Note D) (Continued):
Federal income taxes are computed at statutory rates, including the effect
of surtax exemptions.
(Note E):
Cash Equivalents - For purposes of the statement of cash flows, the
Company considers all liquid short-term investments to be investing activities
and not cash equivalents.
<PAGE>
Item 2
EICO ELECTRONIC INSTRUMENT CO., INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The balance of the gain on the sale of property was recorded as of the
year ended October 3, 1998. While a gain was reflected in the prior year
quarter, no gain is reflected in the current year quarter.
Interest on mortgage in the current 39 week period is included up to the
mortgage collection date in October 1998, while the prior year includes interest
for the entire 39 week period. No interest is reflected in the quarter ended
July 3, 1999.
As a result of investing the proceeds from the mortgage receivable in the
current period, interest on investments increased to $127,423 in the current 39
week period from $37,544 in the prior year 39 week period and $43,111 in the
quarter ended July 3, 1999 from $12,544 in the prior year comparable quarter.
General and corporate expenses increased in the 39 weeks ended in 1999
over the same period in 1998, as a result of increased compensation costs, which
occurred in the quarter ended April 3, 1999.
At July 3, 1999, the Company has cash and investments of approximately
$3,900,000.
On May 28, 1999, the shareholders approved the proposal to dissolve and
liquidate the Company. The Company has no material commitments for future
capital expenditures.
<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.
EICO ELECTRONIC INSTRUMENT CO., INC.
(Registrant)
August 11, 1999 By /s/ Linda Ashley
---------------------------------------
Principal Financial Officer
August 11, 1999 By /s/ Gordon Katz
---------------------------------------
Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-02-1999
<PERIOD-START> OCT-04-1998
<PERIOD-END> JUL-03-1999
<CASH> 40,649
<SECURITIES> 3,864,898
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,911,178
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 3,911,178
<CURRENT-LIABILITIES> 111,808
<BONDS> 0
0
0
<COMMON> 608,293
<OTHER-SE> 3,191,077
<TOTAL-LIABILITY-AND-EQUITY> 3,911,178
<SALES> 0
<TOTAL-REVENUES> 157,245
<CGS> 0
<TOTAL-COSTS> 167,168
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (9,923)
<INCOME-TAX> (2,000)
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (7,923)
<EPS-BASIC> (.01)
<EPS-DILUTED> 0
<FN>
<F1> UNITED STATES TREASURY OBLIGATIONS
</FN>
</TABLE>
