<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended September 30, 1997
----------------------------------------
Commission File Number 1-12476
------------------------------
SUN COAST INDUSTRIES, INC.
--------------------------
(Exact name of Registrant)
Delaware #59-1952968
- ------------------------ ---------------------------------
(State of Incorporation) (IRS Employer Identification No.)
2700 South Westmoreland Ave., Dallas, TX 75233
----------------------------------------------
(Address of principal executive offices)
(214) 373-7864
-------------------------------
(Registrant's telephone number)
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 issuers' classes of
common stock, as of November 10, 1997, the latest practicable date.
Class Outstanding at November 10, 1997
----- --------------------------------
Common stock $0.01 par value 4,117,629
1
<PAGE> 2
SUN COAST INDUSTRIES, INC.
INDEX
<TABLE>
<S> <C>
Part I. Financial Information
Item I - Financial Statements
Condensed Consolidated Balance Sheets -- September 30, 1997
and June 30, 1997 3
Condensed Consolidated Statements of Income -- Three Months
Ended September 30, 1997 and 1996 5
Condensed Consolidated Statements of Cash Flows -- Three
Months ended September 30, 1997 and 1996 6
Notes to Condensed Consolidated Financial Statements 7
Item II - Management's Discussion and Analysis of Financial
Condition and Results of Operations 12
Part II. Other Information
Items 1 through 6 15
</TABLE>
2
<PAGE> 3
PART I. FINANCIAL INFORMATION
Item I. FINANCIAL STATEMENTS
SUN COAST INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
<TABLE>
<CAPTION>
September 30,
1997 June 30,
(unaudited) 1997
----------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 520 $ 324
Accounts receivable, net of allowance for
doubtful accounts of $105 and $170 7,951 8,273
Inventories (Note 3) 4,159 4,358
Other current assets 126 145
Net assets of discontinued
operations (Note 2) 5,463 7,580
-------- --------
Total current assets 18,219 20,680
Property, plant and equipment, net of accumulated
depreciation of $25,182 and $24,367 21,854 22,466
Intangible assets 246 253
Deferred income taxes 387 96
Other assets 1,875 1,834
-------- --------
Total assets $ 42,581 $ 45,329
======== ========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
3
<PAGE> 4
SUN COAST INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except par value)
<TABLE>
<CAPTION>
September 30,
1997 June 30,
LIABILITIES AND STOCKHOLDERS' EQUITY (unaudited) 1997
---------- --------
<S> <C> <C>
Current liabilities:
Accounts payable $ 4,952 $ 5,485
Accrued expenses 6,596 7,214
Current portion
of long-term debt (Note 4) 5,429 5,864
-------- --------
Total current liabilities 16,977 18,563
Long-term debt (Note 4) 11,995 13,455
Deferred income taxes 1,482 1,485
-------- --------
Total liabilities 30,454 33,503
-------- --------
Stockholders' equity:
Common stock, $.01 par value; 40,000,000
shares authorized; 4,117,629 and 4,117,629
respectively, issued and 4,117,629 and
4,104,229, respectively, outstanding 41 41
Additional paid-in capital 11,554 11,654
Treasury stock, 13,400 shares at cost -- (153)
Retained earnings 532 284
-------- --------
Total stockholders' equity 12,127 11,826
-------- --------
Total liabilities and stockholders' equity $ 42,581 $ 45,329
======== ========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
4
<PAGE> 5
SUN COAST INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(dollars in thousands, except per share data)
<TABLE>
<CAPTION>
Three Months Ended
September 30,
---------------------
1997 1996
------- --------
<S> <C> <C>
Sales $16,637 $ 15,996
Costs and expenses:
Cost of sales 14,365 12,715
Selling, general and administrative 1,480 1,992
Interest, net 403 497
------- --------
16,248 15,204
------- --------
Income before provision for income taxes 389 792
Provision for income taxes (141) (257)
------- --------
Income from continuing operations $ 248 $ 535
======= ========
Discontinued operations (Note 2)
Loss from discontinued
operations, net of income taxes
of $145 for 1996 (345)
------- --------
Net income $ 248 $ 190
======= ========
Net income (loss) per common share:
Continuing operations $ 0.06 $ 0.14
Discontinued operations -- (0.07)
------- --------
Net income per common share $ 0.06 $ 0.07
======= ========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
5
<PAGE> 6
SUN COAST INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(dollars in thousands)
<TABLE>
<CAPTION> Three Months Ended
September 30,
--------------------
1997 1996
------- -------
<S> <C> <C>
Cash flows from operating activities:
Net income
--------------------------------------------------------------------------------------
Adjustments to reconcile net income (loss): $ 248 $ 189
Loss from discontinued operations -- 345
Depreciation and amortization 1,159 1,466
Deferred income taxes (294) 1,346
Provision (credit) for doubtful accounts (64) 6
Changes in assets and liabilities:
Accounts receivable 387 1,245
Inventories, net 199 (545)
Other current assets (14) 564
Intangible and other assets (99) (717)
Accounts payable and accrued expenses (1,151) (305)
------- -------
Net cash provided by continuing operations 371 3,594
Net cash provided (used) by discontinued operations 1,476 (1,762)
------- -------
Net cash provided by operating activities 1,847 1,832
------- -------
Cash flows from investing activities:
Capital expenditures (449) (308)
Proceeds from disposal of discontinued operations 640 --
------- -------
Net cash provided (used) in investing activities 191 (308)
------- -------
Cash flows from financing activities:
Repayment of long-term debt (1,895) (735)
Issuance of common stock 53 --
------- -------
Net cash used by financing activities (1,842) (735)
------- -------
Change in cash and cash equivalents 196 789
Cash and cash equivalents at beginning of period 324 1,778
------- -------
Cash and cash equivalents at end of period $ 520 $ 2,567
======= =======
</TABLE>
See accompanying notes to condensed consolidated financial statements.
6
<PAGE> 7
SUN COAST INDUSTRIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1997
NOTE 1 - THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The Company's (defined below) interim financial statements are unaudited
and should be read in conjunction with the consolidated financial
statements and notes thereto in its Form 10-K and Annual Report to
Stockholders for the year ended June 30, 1997.
In the opinion of management, the accompanying consolidated financial
statements contain all adjustments, consisting only of those of a normal
recurring nature, necessary for a fair statement of the results of
operations for the interim periods presented.
Description of Business
Sun Coast Industries, Inc. (the "Company") manufactures and sells plastic
closures and melamine and urea resins and compounds. The Specialty Resins
and Compounds Division manufactures melamine and urea resins and
compounds, which it supplies to other manufacturers. The Closures Division
manufactures linerless, foil or foam lined and tamper-evident plastic
closures and lids. These closures are used in the U.S. for bottling and
packaging of food, beverage, chemical and pharmaceutical products. The
Consumer Products and Foodservice Divisions, which are being discontinued
(see Note 2), manufacture compression molded melamine dinnerware and
injection molded plastic drinkware and other houseware products, which the
Company sells to U.S., Canadian and Mexican retail and commercial markets.
Principles of Consolidation
The consolidated financial statements include the accounts of the Company
and its subsidiaries, all of which are wholly-owned. All significant
intercompany balances and transactions have been eliminated in
consolidation. The preparation of consolidated financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial statements
and the reported amounts of revenues and expenses during the period.
Actual results could differ from the estimates. Certain amounts in
previously issued financial statements have been reclassified to conform
with the current year financial statement presentation.
Inventories
Inventories are valued at the lower of cost or market, with cost
determined utilizing the first-in, first-out (FIFO) method.
Property, Plant and Equipment
Property, plant and equipment are carried at cost and depreciated using
the straight-line method over the estimated useful lives of the related
assets. Lives assigned to asset categories are 5 to 15 years for machinery
and equipment, 30 to 35 years for buildings and 5 years for molds.
Machinery and equipment under capital leases are stated at the present
value of minimum lease payments and amortized over 1 to 3 years. Renewals
and improvements that significantly add to the productive capacity or
extend the useful life of an asset are capitalized. Repairs and
maintenance are charged to expense as incurred.
7
<PAGE> 8
SUN COAST INDUSTRIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1997
NOTE 1 - THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Cont'd)
Goodwill
Goodwill, which represents the excess of purchase price over fair value of
net identifiable assets acquired, is amortized on a straight-line basis
over the expected periods to be benefited, ranging from 5 - 20 years. The
Company assesses the recoverability of this intangible asset by
determining whether the amortization of the goodwill balance over its
remaining life can be recovered through undiscounted future operating cash
flows of the acquired operation. The amount of goodwill impairment, if
any, is measured based on projected discounted future operating cash flows
using a discount rate reflecting the Company's average cost of funds. The
assessment of the recoverability of goodwill will be impacted if estimated
future operating cash flows are not achieved.
Impairment of Long-Lived Assets and Long-Lived Assets to Be Disposed Of
The Company adopted the provisions of SFAS No. 121, Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
Of, on July 1, 1996. This Statement requires that long-lived assets and
certain identifiable intangibles be reviewed for impairment whenever
events or changes in circumstances indicate that the carrying amount of an
asset may not be recoverable. Recoverability of assets to be held and used
is measured by a comparison of the carrying amount of an asset to future
net cash flows expected to be generated by the asset. If such assets are
considered to be impaired, the impairment to be recognized is measured by
the amount by which the carrying amount of the assets exceed the fair value
of the assets. Assets to be disposed of are reported at the lower of the
carrying amount or fair value less costs to sell. Adoption of the
Statement did not have a material impact on the Company's financial
position, results of operations, or liquidity.
Income Taxes
Deferred income taxes are provided for temporary differences between
financial and tax reporting. Income taxes are provided for taxes currently
payable based on taxable income.
Stock Option Plan
Prior to July 1, 1996, the Company accounted for its stock option plan in
accordance with the provisions of Accounting Principles Board ("APB")
Opinion No. 25, Accounting for Stock Issued to Employees, and related
interpretations. As such, compensation expense would be recorded on the
date of grant only if the current market price of the underlying stock
exceeded the exercise price. On July 1, 1996, the Company adopted SFAS No.
123, Accounting for Stock-Based Compensation, which permits entities to
recognize as expense over the vesting period the fair value of all
stock-based awards on the date of grant. Alternatively, SFAS No. 123 also
allows entities to continue to apply the provisions of APB Opinion No. 25
and provide pro forma net income and pro forma earnings per share
disclosures for employee stock option grants made in fiscal 1996 and
future years as if the fair-value-based method defined in SFAS No. 123 had
been applied. The Company has elected to continue to apply the provisions
of APB Opinion No. 25 and provide the pro forma disclosure provisions of
SFAS No. 123.
Environmental Costs
A liability for environmental assessments and/or cleanup is accrued when
it is probable a loss has been incurred and is estimable. No significant
liabilities were in existence at September 30, 1997 and June 30, 1997.
Net Income Per Common Share
Net income per common share is computed by dividing net income by the
weighted average number of common shares outstanding during each period
after giving effect to stock options and warrants considered to be
dilutive common stock equivalents.
8
<PAGE> 9
SUN COAST INDUSTRIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1997
NOTE 1 - THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Cont'd)
Revenue Recognition
Sales are recognized when the product is shipped. Sales are shown net of
returns and allowances.
Research and Development
Research and development costs associated with new product development,
application and testing are expensed as incurred.
Statement of Cash Flows
For purposes of the statements of cash flows, the Company considers all
highly liquid investments with original maturities of three months or less
to be cash equivalents. Cash equivalents at September 30, 1997 and June
30, 1997 were not significant.
NOTE 2 - DISCONTINUED OPERATIONS
On December 6, 1996, the Company's Board of Directors adopted a formal
plan to dispose of its Foodservice and Consumer Products Tableware
Divisions including the Company's foreign subsidiary in Mexico and to
consider strategic alternatives related to the on-going business. These
divisions have been accounted for as discontinued operations in accordance
with Accounting Principles Board Opinion No. 30. Management believes this
disposal will be carried out by June 30, 1998. In February 1997, the
Company sold its Foodservice Division for cash proceeds of $2,104,000 and
it has plans underway to exit the Consumer Products Division, either
through sale or termination of operations.
Based on management's assumptions used in determining the estimated gain
or loss from the disposal of the tableware business, the Company recorded
a provision of $4,855,000, net of income taxes, for the loss on disposal
of the discontinued business in the fiscal year ended June 30, 1997. This
loss on disposal of discontinued operations resulted from the estimated
net loss on the sale of the Foodservice Division and estimated net loss on
the exit of the Consumer Products Tableware Division of approximately
$3,997,000, net of income taxes, as well as estimated operating losses
during the period required to dispose of the divisions of approximately
$858,000, net of income taxes.
Sales of the divisions for the five months of fiscal 1997 prior to the
December 6th Board's decision to discontinue these operations were
$7,678,000. Sales for the three month periods ended September 30, 1997
and 1996 were $1,458,000 and $4,671,000, respectively.
The remaining reserve for loss on disposal is considered adequate at
September 30, 1997 to cover estimated future costs of disposal of the
Consumer Products Tableware Division.
9
<PAGE> 10
The net assets of discontinued operations are summarized as follows:
<TABLE>
<CAPTION>
SEPTEMBER 30, JUNE 30,
1997 1997
(unaudited)
------------ --------
($ in thousands)
<S> <C> <C>
Current assets $ 4,068 $ 6,401
Plant, property and equipment 3,770 4,117
Intangible & other assets 498 503
Current liabilities (382) (280)
Accrued expenses (1,132) (870)
Long term debt -- (1,000)
Deferred taxes 967 1,309
Foreign Currency Translation 737 737
Provision for estimated loss
on disposal (3,063) (3,337)
------- -------
Net assets of discontinued
operations $ 5,463 $ 7,580
======= =======
</TABLE>
NOTE 3 - INVENTORIES
<TABLE>
<CAPTION>
September 30,
1997 June 30,
(unaudited) 1997
------------ --------
(in thousands)
<S> <C> <C>
Raw Materials $2,329 $ 2,169
Work-in-process 324 384
Finished good 2,253 2,439
------ --------
4,906 4,992
Obsolescence reserve (747) (634)
------ --------
$4,159 $ 4,358
====== ========
</TABLE>
10
<PAGE> 11
NOTE 4 - LONG TERM DEBT
<TABLE>
<CAPTION>
September 30, June 30,
1997 1997
(unaudited)
---------- --------
(in thousands)
<S> <C> <C>
Term Loan $12,820 $ 13,742
Revolving credit line 2,737 3,643
Industrial development revenue bonds 1,988 2,025
Capitalized lease obligations 122 178
------- -------
Subtotal 17,667 19,588
Less: Debt financing expense (243) (269)
------- --------
17,424 19,319
Current maturities on original
maturity schedule (5,429) (5,864)
------- --------
$11,995 $ 13,455
======= ========
</TABLE>
On January 31, 1997, the Company refinanced its existing debt with a new
lender to provide a total credit facility of $30 million in borrowings
secured by substantially all the assets of the Company. The facility
provides for borrowings under three separate arrangements - (i) a term
loan in an aggregate principal amount of $10 million payable in monthly
installments through January 31, 2000, (ii) a second term loan in an
aggregate principal amount of $5 million payable in monthly installments
beginning January 1, 1998 through January 31, 2000, and (iii) a $15
million revolving loan, due January 31, 2000. As of September 30, 1997,
outstanding borrowings under the credit facility included $12.8 million
under the two term loans, and $2.7 million under the revolving credit
line. At September 30, 1997, based on the Company's borrowing formula
incremental borrowing availability was approximately $6.3 million under
the revolving credit line. The credit facility provides for the issuance
of up to $2.0 million of letters of credit, subject to the borrowing
availability under the revolving credit line. The loan agreement
contains various covenants, including maintaining certain financial ratios
and tests, limitation on the issuance of debt and the amount of capital
expenditures, capital leases, investments and dividends. The primary
financial covenants include quarter end calculations of net worth, working
capital and fixed charge coverage and a limitation on annual capital
expenditures. In conjunction with the refinancing, the Company issued
100,000 shares of its common stock to the new lender.
As the Company is currently in compliance with the loan covenants on its
new debt, the Company has classified its outstanding debt as current or
long term based upon maturity obligations.
11
<PAGE> 12
Item II. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Three Months Ended September 30, 1997, Compared to the Three Months
Ended September 30, 1996 for Continuing Operations
Sales for the three months ended September 30, 1997 increased $641,000 or
4.0%, when compared to the same period in 1996 due primarily to increased
customer demand.
Cost of sales as a percentage of net sales increased to 86.3% from
79.5%. The decrease in gross margin was primarily the result of volume
decreases affecting absorption as well as certain price reductions in the
Closure's division. In the Chemical division, a worldwide shortage of
one of it's primary raw materials resulted in cost increases that were
not passed through until the second quarter.
Selling, general and administrative expense ("SG&A") decreased $512,000
to 8.9% of sales for the three months ended September 30, 1997 as compared
to 12.5% of sales for the three months ended September 30, 1996. This
decrease is primarily the result of non-recurring legal expenses incurred
in the comparable prior fiscal period.
Interest expense has decreased $94,000 for the three months ended
September 30, 1997 compared to the three months ended September 30, 1996
primarily due to the Company's effort to pay down the long-term debt
facility offset by an increase in interest rates as a result of the new
bank financing completed in January 1997.
Net income from continuing operations decreased $287,000 from the
comparable prior fiscal period primarily due to the margin shrinkage
related to raw material price increases discussed above.
12
<PAGE> 13
Item II. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Discontinued Operations
On December 6, 1996, the Company's Board of Directors adopted a formal
plan to dispose of its Foodservice and Consumer Products Tableware
Divisions including the Company's foreign subsidiary in Mexico and to
consider strategic alternatives related to the on-going business. These
divisions have been accounted for as discontinued operations in accordance
with Accounting Principles Board Opinion No. 30. Management believes this
disposal will be carried out by June 30, 1998. In February 1997, the
Company sold its Foodservice Division for cash proceeds of $2,104,000 and
it has plans underway to exit the Consumer Products Division, either
through sale or termination of operations.
Based on management's assumptions used in determining the estimated gain
or loss from the disposal of the tableware business, the Company recorded
a provision of $4,855,000 million, net of income taxes, for the loss on
disposal of the discontinued business in the fiscal year ended June 30,
1997. This loss on disposal of discontinued operations resulted from the
estimated net loss on the sale of the Foodservice Division and estimated
net loss on the exit of the Consumer Products Tableware Division of
approximately $3,997,000 million, net of income taxes, as well as
estimated operating losses during the period required to dispose of the
divisions of approximately $858,000, net of income taxes.
Sales of the divisions for the five months of fiscal 1997 prior to the
December 6th Board's decision to discontinue these operations were
$7,678,000. Sales for the three month periods ended September 30, 1997
and 1996 were $1,458,000 and $4,671,000 respectively.
The remaining reserve for loss on disposal is considered adequate at
September 30, 1997 to cover estimated future costs of disposal of the
Consumer Products Tableware Division.
Liquidity and Capital Resources
Management reviews the Company's working capital, accounts receivable and
relationship of debt to equity on a continuing basis. The Company's growth
has been financed through long-term debt financing and cash generated from
operations. During the three months ended September 30, 1997, the Company
repaid net borrowings by $1.9 million. Cash flow from continuing
operations generated $0.2 million.
Capital expenditures for the three months ended September 30, 1997 were
$0.4 million. Anticipated future capital additions should approximate
less than $3 million for the remainder of fiscal 1998.
On January 31, 1997, the Company refinanced its existing debt with a new
lender to provide a total credit facility of $30 million in borrowings
secured by substantially all the assets of the Company. The facility
provides for borrowings under three separate arrangements - (i) a term
loan in an aggregate principal amount of $10 million payable in monthly
installments through January 31, 2000, (ii) a second term loan in an
13
<PAGE> 14
aggregate principle amount of $5 million payable in monthly installments
beginning January 1, 1998 through January 31, 2000, and (iii) a $15
million revolving loan, due January 31, 2000. As of September 30, 1997,
outstanding borrowings under the credit facility included $12.8 million
under the two term loans and $2.7 million under the revolving credit line.
At September 30, 1997, based on the Company's borrowing formula
incremental borrowing availability was approximately $6.3 million under
the revolving credit line. The credit facility provides for the issuance
of up to $2.0 million of letters of credit, subject to the borrowing
availability under the revolving credit line. The loan agreement contains
various covenants, including maintaining certain financial ratios and
tests, limitation on the issuance of debt and the amount of capital
expenditures, capital leases, investments and dividends. The primary
financial covenants include quarter end calculations of net worth, working
capital and fixed charge coverage and a limitation on annual capital
expenditures.
The Company's plan to discontinue its Tableware business should not have
an overall material impact on liquidity. Certain cash proceeds were
received from the sale of its Foodservice Division and there were
offsetting cash needs related to severance, relocation and other costs of
discontinuing the Consumer Products Division. The majority of costs
related to the discontinuation of the Tableware business are non-cash.
Management believes internally generated funds should be adequate to meet
future debt repayments and capital expenditure needs.
The Company's Mexican subsidiary, included in discontinued operations, is
subject to currency risk to the extent its net assets, denominated in
pesos, devalues against the U.S. dollar.
Disclosures Regarding Forward-Looking Statements
This report on Form 10-Q includes "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. All
statements other than statements of historical facts included in this Form
10-Q, including, without limitation, statements contained in this
"Management's Discussion and Analysis of Financial Condition and Result of
Operations" regarding the Company's financing alternatives, financial
position, business strategy, plans and objectives of management of the
Company for future operations, and industry conditions, are
forward-looking statements. Although the Company believes that the
expectations reflected in any such forward-looking statements are
reasonable, it can give no assurance that such expectations will prove to
have been correct. Any forward-looking statements herein are subject to
certain risks and uncertainties in the Company's business, including but
not limited to, the intense competition in its markets, its recent
experience of increasing raw material prices, the absence of assurance of
strategic and financing alternatives, Mexican currency fluctuations and
its reliance on certain key customers; all of which may be beyond the
control of the Company. Any one or more of these factors could cause
actual results to differ materially from those expressed in any forward-
looking statement. All subsequent written and oral forward-looking
statements attributable to the Company or person acting on its behalf are
expressly qualified in their entirety by the cautionary statements
disclosed in this paragraph and otherwise in this report.
14
<PAGE> 15
SUN COAST INDUSTRIES, INC.
September 30, 1997
PART II - OTHER INFORMATION
Item 1 - Legal Proceedings
None.
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
Item 6 - Exhibits and Reports in Form 8K
(a) Exhibits:
27 Financial Data Schedule
15
<PAGE> 16
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.
Sun Coast Industries, Inc.
------------------------------------------------------
Registrant
11/10/97 By: /s/ EDDIE M. LESOK
- -------- --------------------------------------------------
Date Eddie Lesok, Chief Executive Officer and President
11/10/97 By: /s/ CYNTHIA R. MORRIS
- -------- --------------------------------------------------
Date Cynthia R. Morris, CFO, Secretary and Treasurer
16
<PAGE> 17
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-END> SEP-30-1997
<CASH> 520
<SECURITIES> 0
<RECEIVABLES> 8,056
<ALLOWANCES> 105
<INVENTORY> 4,159
<CURRENT-ASSETS> 18,219
<PP&E> 47,036
<DEPRECIATION> 25,182
<TOTAL-ASSETS> 42,581
<CURRENT-LIABILITIES> 16,977
<BONDS> 0
0
0
<COMMON> 41
<OTHER-SE> 11,022
<TOTAL-LIABILITY-AND-EQUITY> 42,581
<SALES> 16,637
<TOTAL-REVENUES> 16,637
<CGS> 14,365
<TOTAL-COSTS> 14,365
<OTHER-EXPENSES> 1,883
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 403
<INCOME-PRETAX> 389
<INCOME-TAX> (141)
<INCOME-CONTINUING> 248
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 248
<EPS-PRIMARY> .06
<EPS-DILUTED> 0
<FN>
<F1>Net Assets of Discontinued Operations - 5,463
</FN>
</TABLE>
