<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended JUNE 30, 1998 Commission file number 0-7099
-------------- ------
CECO ENVIRONMENTAL CORP.
------------------------------------------------
NEW YORK 13-2566064
- -------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
505 UNIVERSITY AVENUE, SUITE 1400, TORONTO, ONTARIO, CANADA M5G 1X3
- ------------------------------------------------------------- ------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 416-593-6543
------------
- -------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last
report.
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 and (2) has been subject to such filing requirements for
the past 90 days.
X Yes No
------ ------
Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the close of the period covered by this report.
Class: COMMON, PAR VALUE $.01 PER SHARE
OUTSTANDING at June 30, 1998 8,250,896
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
JUNE 30, 1998
- ------------------------------------------------------------------------------
INDEX
Part I - Financial Information:
Condensed consolidated balance sheet as of
June 30, 1998 and December 31, 1997 2
Condensed consolidated statement of operations
for the three-month and six-month periods ended
June 30, 1998 and 1997 3
Condensed consolidated statement of cash flows for the
six-month periods ended June 30, 1998 and 1997 4
Notes to condensed consolidated financial statements 5 & 6
Management's discussion and analysis of the
financial condition and results of operations 7 to 11
Signature 12
1
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(unaudited)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1998 1997
------------ ------------
ASSETS
Current assets:
<S> <C> <C>
Cash $ 269,327 $ 847,827
Marketable securities - trading 626,222 634,150
Accounts receivable 4,077,788 2,979,414
Inventories 725,379 771,068
Costs and estimated earnings in excess of
billings on uncompleted contracts 622,041 235,454
Prepaid expenses and other current assets 134,807 230,458
Prepaid and refundable income taxes -- 150,200
Due from former owners of Busch Co. 207,391 --
Deferred income taxes 33,477 33,477
------------ ------------
Total current assets 6,696,432 5,882,048
Property and equipment, net 2,093,034 1,947,482
Goodwill, net 5,062,236 5,834,858
Other intangible assets, at cost, net 1,345,119 272,696
Deferred income taxes 23,896 23,896
------------ ------------
Total assets $ 15,220,717 $ 13,960,980
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term obligations $ 800,000 $ --
Current portion of long-term debt 301,036 333,871
Current portion of capital lease obligation 5,554 5,554
Accounts payable and accrued expenses 3,231,689 1,873,965
Billings in excess of costs and estimated
earnings on uncompleted contracts 1,645,036 2,517,310
Accrued income taxes 100,800 --
Due former owners of Busch Co. -- 502,592
------------ ------------
Total current liabilities 6,084,115 5,233,292
Long-term debt, less current portion 1,603,822 1,732,993
Capital lease obligation, less current portion 794 3,821
------------ ------------
Total liabilities 7,688,731 6,970,106
------------ ------------
Minority interest 165,755 248,289
------------ ------------
Shareholders' equity:
Preferred stock, $.01 par value; 10,000,000
shares authorized, none issued -- --
Common stock, $.01 par value; 100,000,000
shares authorized, 8,388,816 and 8,107,048
shares issued, respectively 83,888 81,070
Capital in excess of par value 10,139,013 9,860,063
Accumulated deficit (2,508,001) (2,849,879)
------------ ------------
7,714,900 7,091,254
Less treasury stock, at cost (348,669) (348,669)
------------ ------------
Net shareholders' equity 7,366,231 6,742,585
------------ ------------
Total liabilities and shareholders' equity $ 15,220,717 $ 13,960,980
============ ============
</TABLE>
See accompanying notes to condensed consolidated financial statements.
2
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(unaudited)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
1998 1997 1998 1997
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues:
Net sales - products $ 1,775,781 $ 2,927,091 $ 4,190,770 $ 5,418,967
Contract revenues 4,648,445 -- 8,888,291 48,520
------------ ------------ ------------ ------------
Total revenues 6,424,226 2,927,091 13,079,061 5,467,487
------------ ------------ ------------ ------------
Costs and expenses:
Cost of revenues - products 818,199 1,482,156 2,103,209 2,770,027
Cost of revenues - contracts 3,514,497 -- 6,543,452 27,000
Selling and administrative 1,598,006 1,059,297 3,476,426 1,975,761
Depreciation and amortization 81,866 120,423 223,575 239,789
------------ ------------ ------------ ------------
6,012,568 2,661,876 12,346,662 5,012,577
------------ ------------ ------------ ------------
Income from operations 411,658 265,215 732,399 454,910
Investment income 18,513 48,581 35,445 70,576
Interest expense, net (63,444) (20,745) (112,789) (49,378)
------------ ------------ ------------ ------------
Income before provision
for income taxes 366,727 293,051 655,055 476,108
Provision for income taxes 147,000 97,400 276,000 161,000
------------ ------------ ------------ ------------
Income before minority interest 219,727 195,651 379,055 315,108
Minority interest (13,648) (43,769) (37,177) (74,248)
------------ ------------ ------------ ------------
Net income $ 206,079 $ 151,882 $ 341,878 $ 240,860
============ ============ ============ ============
Net income per share,
basic and diluted $ .02 $ .02 $ .04 $ .03
============ ============ ============ ============
Weighted average number of common
shares outstanding:
Basic 8,250,896 7,262,628 8,203,935 7,231,628
============ ============ ============ ============
Diluted 8,680,198 7,743,544 8,633,236 7,712,544
============ ============ ============ ============
</TABLE>
See accompanying notes to condensed consolidated financial statements.
3
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
1998 1997
------------ ------------
<S> <C> <C>
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
Cash flows from operating activities:
Net income $ 341,878 $ 240,860
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 166,841 199,260
Goodwill amortization - CECO Filters, Inc. 56,734 40,529
Minority interest 37,177 74,248
Noncash expenses, officer's compensation - 17,500
(Increase) decrease in operating assets:
Accounts receivable (528,668) 1,270,200
Inventories 45,689 74,555
Costs and estimated earnings in excess of
billings on uncompleted contracts (362,701) -
Prepaid expenses and other current assets 113,392 (1,661)
Prepaid and refundable income taxes 150,200 -
Purchases of marketable securities (1,603,786) (515,054)
Proceeds from sales of marketable securities 1,611,714 617,229
Increase (decrease) in operating liabilities:
Accounts payable and accrued expenses 861,107 (521,331)
Billings in excess of costs and estimated
earnings on uncompleted contracts (1,044,098) -
Income taxes payable 100,800 (244,290)
---------- ----------
Net cash provided by (used in) operating activities (53,721) 1,252,045
----------- ---------
Cash flows from investing activities:
Acquisition of IFM, net of cash acquired, comprised
of the following:
Excess of current liabilities over current assets,
net of cash acquired 169,756 -
Equipment (125,132) -
Goodwill (152,533) -
Additions to property and equipment and intangible assets (131,273) (211,305)
Acquisition of additional shares of CECO Filters, Inc. (97,932) -
----------- ------------
Net cash (used in) investing activities (337,114) (211,305)
---------- ----------
Cash flows from financing activities:
Net borrowings (repayments) of short-term obligations 800,000 (400,000)
Net (repayments) of long-term debt and capital lease obligation (277,682) (58,292)
Due from/to former owners of Busch Co. (709,983) -
---------- ------------
Net cash (used in) financing activities (187,665) (458,294)
---------- ----------
Net increase (decrease) in cash (578,500) 582,446
Cash at beginning of period 847,827 412,174
---------- ----------
Cash and cash equivalents at end of period $ 269,327 $ 994,620
========== ==========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the quarter for:
Interest $ 137,752 $ 49,308
---------- -----------
Income taxes $ 53,100 $ 34,800
----------- -----------
</TABLE>
See accompanying notes to condensed consolidated financial statements.
4
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
- --------------------------------------------------------------------------------
1. In the opinion of management, the accompanying unaudited condensed
consolidated financial statements contain all adjustments necessary to
present fairly the financial position as of June 30, 1998, the results
of operations for the three-month and six-month periods ended June 30,
1998 and 1997 and cash flows for the six-month periods ended June 30,
1998 and 1997. The results of operations for the six-month period ended
June 30, 1998 are not necessarily indicative of the results to be
expected for the full year.
2. Acquisition of Businesses
During March 1998, pursuant to an Asset Purchase Agreement, the Company
acquired substantially all of the assets, and the business, of
Integrated Facilities Management, Inc. ("IFM") for $150,000 in cash.
IFM, located in Mesa, Arizona, provides a full range of services for
inter-facility general repair, preventive maintenance and inter-facility
construction needs exclusively for owners and users of industrial,
commercial, educational, healthcare and manufacturing facilities. The
acquisition was accounted for as a purchase. The Asset Purchase
Agreement provides that, notwithstanding the actual closing date, the
closing was deemed to be effective as of January 1, 1998. The condensed
consolidated statement of operations for the six-month period ended June
30, 1998, therefore, includes the operations of IFM since January 1,
1998.
On September 25, 1997, the Company acquired substantially all of the
assets, and the business, of Busch Co. During April 1998, the Company
completed a valuation of certain patents acquired as part of this
acquisition, utilizing the services of an independent consultant. The
valuation resulted in the reclassification of $1,047,000 from goodwill
to other intangible assets.
On a pro forma basis, results of operations for the six-month periods
ended June 30, 1998 and 1997, would have been as follows, if the
acquisitions had been made as of January 1, 1997.
SIX MONTHS ENDED
JUNE 30,
1998 1997
------ ------
Total revenues $13,079,061 $14,500,606
Income before provision for income taxes 655,055 733,133
Net income 341,878 341,773
Net income per share, basic and diluted .04 .05
3. Inventories consisted of the following:
JUNE 30, DECEMBER 31,
1998 1997
--------- ------------
Raw materials $513,082 $409,639
Work-in-process 6,499 157,911
Finished goods 205,798 203,518
------- -------
$725,379 $771,068
======= =======
5
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(unaudited)
- --------------------------------------------------------------------------------
4. Investment in CECO Filters, Inc.
In February 1998, the Company exchanged 281,768 additional shares of its
common stock for 281,768 shares of CECO common stock with an unrelated
third party. Also, during the six months ended June 30, 1998, the
Company acquired 93,610 more shares of CECO's common stock on the open
market for cash. As of June 30, 1998, the Company owned 92.92% of CECO's
common stock.
Summarized financial information of CECO as of and for its six months
ended June 30, 1998, is as follows:
Financial position:
Working capital $ 1,759
===========
Total assets $10,545,158
===========
Net shareholders' equity $ 2,411,227
===========
Results of operations:
Total revenues $13,079,061
===========
Income before income taxes $ 688,829
===========
Net income $ 412,829
===========
6
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
(unaudited)
- --------------------------------------------------------------------------------
Financial Condition, Liquidity and Capital Resources - The Company
The Company's consolidated cash and marketable securities position decreased
from $1,481,977 at December 31, 1997 to $895,549 at June 30, 1998. This decrease
of $586,428 is attributable to the use of cash in operating activities of
$61,649 (excluding purchases and sales of marketable securities), use of cash in
investing activities of $337,114, and use of cash in financing activities of
$187,665. The investments in marketable securities are primarily in high yield
bonds of major U.S. corporations, as well as U.S. Treasury Bills. CECO Filters,
Inc. ("CECO") maintains a $2,000,000 line of credit with a commercial bank, of
which $800,000 was outstanding as of June 30, 1998.
Management believes that the expected revenues from the operations of CECO,
supplemented by the available line of credit, will be sufficient to provide
adequate cash to fund anticipated working capital and other cash needs during
the remainder of the year.
The Company and CECO entered into a five-year management and consulting
agreement during 1994 pursuant to which the Company provides management and
financial consulting services to CECO for a monthly fee of $20,000 until the
agreement expires in December 1998. The Company believes its consulting
agreement with CECO and interest income from its investments in marketable
securities, should provide sufficient revenue to meet its general and
administrative expenses.
Results of Operations - The Company
The Company's consolidated statement of operations for the six-month periods
ended June 30, 1998 and 1997 reflects the operations of the Company consolidated
with the operations of CECO. At June 30, 1998, the Company owned approximately
93% of CECO. Minority interest in the consolidated statement of operations has
been presented as a reduction in net income.
The Company received $60,000 during each quarter for management and financial
consulting services provided to CECO. This amount is not reflected in the
consolidated results of operations since it is eliminated in consolidation.
Except as set forth above, the Company has no other income, revenues or expenses
other than as a result of its investment in CECO and its investment in
marketable securities, and except for its investment activities, the Company
does not engage in operations other than through its operating subsidiary, CECO.
CECO is comprised of CECO Filters, Inc., Air Purator Corporation ("APC"), U.S.
Facilities Management Company, Inc. ("USFM") and New Busch Co., Inc.
(collectively referred to as "the CECO Group"), which provide innovative
solutions to air quality problems through particle and chemical control
technologies and management services.
7
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION
AND RESULTS OF OPERATIONS - CONTINUED
(unaudited)
- --------------------------------------------------------------------------------
Results of Operations - The Company - Continued
CECO manufactures and markets filters known as fiber bed mist eliminators,
designed to trap, collect and remove solid soluble and liquid particulate matter
suspended in an air or other gas stream whether generated from a point source
emission or otherwise. CECO offers innovative patented technologies, Catenary
Grid (R) and Narrow Gap Venturi(TM), designed for use with heat and mass
transfer operations and particulate control. APC designs and manufactures high
performance filter media and bags for use in high temperature pulse-jet
baghouses, the most effective type of baghouse for capturing submicron
particulate from gas streams. USFM provides facilities management and software,
as well as outsourced plant-wide maintenance management to help customers
achieve their performance goals. Busch is engaged in designing, manufacturing
and supplying equipment used to control the environment in and around industrial
plants with a variety of proprietary and patented technologies.
On March 16, 1998, CECO acquired substantially all of the assets of Integrated
Facilities Management ("IFM") of Mesa, Arizona in an all cash transaction,
effective January 1, 1998. IFM provides facility audits, preventative
maintenance, labor force augmentation, as-built warranty reconciliation,
pre-scheduled facility maintenance inspection, inter-facility construction
services and other trade services. IFM has been integrated into USFM. USFM will
continue to provide its unique environmental maintenance services. USFM also
includes a technology arm through its strategic alliance with Western VAR
Alliance. USFM can now offer complete facilities management and computerized
facility and maintenance management and co-sourced resources through a single
organization.
Results of Operations - CECO (Company's Subsidiary)
Comparison of Six Months Ended June 30, 1998 to Six Months Ended June 30, 1997
Revenues were approximately $13.1 million and $5.5 million for the six months
ended June 30, 1998 and 1997, respectively, an increase of 139%. The increase in
revenues from 1997 to 1998 resulted from the acquisition of Busch Co. in
September, 1997 and IFM in March, 1998, increasing revenues by $7.0 million and
$1.7 million, respectively.
The CECO Group's backlog of orders and services at June 30, 1998 was
approximately $10.0 million as compared to approximately $1.5 million at June
30, 1997, an increase of $8.5 million or 567%. The increase is principally
attributable to the impact of the Busch Co. and IFM acquisitions. There can be
no assurance that order and service backlog will be replicated, or increased, or
translate into higher revenues in the future. The success of the CECO Group's
business depends on a multitude of factors that are out of the CECO Group's
control. The CECO Group's operating results can be significantly impacted by the
introduction of new products and services, new manufacturing technologies, rapid
change in the demand for its product and services, decrease in the average
selling price over the life of a product as competition increases, and the CECO
Group's dependence on the efforts of middle men to sell a significant portion of
its products and services.
8
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION
AND RESULTS OF OPERATIONS - CONTINUED
(unaudited)
- --------------------------------------------------------------------------------
Results of Operations - CECO (Company's Subsidiary)
Comparison of Six Months Ended June 30, 1998 to Six Months Ended
June 30, 1997 - Continued
The CECO Group's overall cost of revenues increased as a percentage of revenues
for the six months ended June 30, 1998 (66%) compared to the six months ended
June 30, 1997 (51%). The increase is attributed to the impact of Busch Co. where
costs as a percentage of revenues amounted to 70%, and IFM, now called USFM
(Service), where costs as a percentage of revenues amounted to 95% both from
January 1, 1998 through March 31, 1998. Without the impact of Busch Co. and USFM
(Service), the cost of revenues as a percentage of revenues would have been
48.5%. The decrease, compared to the prior year and without the impact of Busch
Co. and USFM (Service), is attributed to lower material costs, as well as lower
costs incurred to service the CECO Group's products. The CECO Group continues to
use the latest technology available in an effort to reduce both cost of revenues
(and the maintenance of optimal inventory levels) and operating expenses, and
ultimately increase overall company profits.
The CECO Group's selling and administrative expenses amounted to $3,318,940 for
the six-month period ended June 30, 1998 compared to $1,897,766 for the
six-month period ended June 30, 1997, representing an increase of $1,421,174 or
75%. This increase is the direct result of selling and administrative expenses
of Busch Co. and IFM.
During 1994, the CECO Group entered into a management and consulting agreement
with the Company. The terms of the agreement require payment of monthly fees of
$20,000 through December, 1998 in exchange for management and financial
consulting services involving corporate policies; marketing; strategic and
financial planning; and mergers, acquisitions and related matters. The CECO
Group incurred management fees to the Company of $120,000 during each of the
six-month periods ended June 30, 1998 and 1997.
Interest expense increased by $88,412, or 179% during the six-month period ended
June 30, 1998 as compared to the same period in 1997. The increase in interest
expense can be attributed to an increased utilization of the bank line of credit
during the six months ended June 30, 1998 compared to the previous year, as well
as additional borrowings in the second half of 1997 incurred to fund the
acquisition of Busch Co.
The CECO Group earned pre-tax income of $688,829 for the six-month period ended
June 30, 1998 compared to $404,056 for the six-month period ended June 30, 1997.
This change is attributed principally to the increase in revenues for the
six-month period ended June 30, 1998 over the comparable period in 1997.
The provision for federal and state income taxes for the six-month period ended
June 30, 1998 amounted to $276,000 compared to $161,000 for the six-month period
ended June 30, 1997 and reflects an effective income tax rate of approximately
40% for each period.
9
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION
AND RESULTS OF OPERATIONS - CONTINUED
(unaudited)
- --------------------------------------------------------------------------------
Results of Operations - CECO (Company's Subsidiary)
Comparison of Three Months Ended June 30, 1998 to Three Months
Ended June 30, 1997
Sales were approximately $6.4 million and $2.9 million for the three-month
periods ended June 30, 1998 and 1997, respectively. This represents an increase
of 119.5% compared to the three months ended June 30, 1997.
CECO's overall cost of revenues increased as a percentage of revenues for the
three months ended June 30, 1998 (67.4%) compared to the three months ended June
30, 1997 (50.6%). The increase is attributed to the impact of Busch Co. where
cost as a percentage of revenues amounted to 72%, and IFM, now called USFM
(Service), where cost as a percentage of revenues amounted to 98%, both from
April 1, 1998 through June 30, 1998. Without the impact of Busch Co. and USFM
(Service), the cost of revenues as a percentage of revenues would have been
48.4%. The decrease, compared to the prior year and without the impact of Busch
Co. and USFM (Service), is attributed to lower material costs, as well as lower
costs incurred to service the CECO Group's products. The CECO Group continues to
use the latest technology available in an effort to reduce both cost of revenue
(and the maintenance of optimal inventory levels) and operating expenses, and
ultimately increase overall company profits.
The CECO Group's selling and administrative expenses amounted to $1,536,733 for
the three-month period ended June 30, 1998 compared to $1,019,619 for the
three-month period ended June 30, 1997, representing an increase of $517,114 or
50.7%. This increase is the direct result of selling and administrative expenses
of Busch Co. and IFM.
Interest expense increased by $55,199, or 266% during the three-month period
ended June 30, 1998 when compared to the same period in 1997. The increase in
interest expense can be attributed to an increased utilization of the bank line
of credit during the three months ended June 30, 1998 compared to the previous
year, as well as additional borrowings incurred in the second half of 1997 to
fund the acquisition of Busch Co.
The CECO Group earned pre-tax income of $365,761 for the three-month period
ended June 30, 1998 as compared to $244,941 for the three-month ended June 30,
1997. This change is attributed principally to the increase in revenues for the
three-month period ended June 30, 1998 over the comparable period in 1997.
The provision for federal and state income taxes for the three-month period
ended June 30, 1998 amounted to $147,000 compared to $97,400 for the three-month
period ended June 30, 1997 and reflects an effective income tax rate of
approximately 40% for each period.
10
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION
AND RESULTS OF OPERATIONS - CONTINUED
(unaudited)
- --------------------------------------------------------------------------------
Other Matters
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor"
for forward-looking statements. Certain information included in this document
and other materials filed or to be filed with the Securities and Exchange
Commission, as well as information included in oral or other written statements
made or to be made by the Company, contains statements that are forward-
looking. Such statements may relate to plans for future expansion, business
development activities, other capital spending, financing, or other effects of
regulation and competition. Such information involves important risks and
uncertainties that could significantly affect anticipated results in the future
and, accordingly, such results may differ from those expressed in any forward-
looking statements made by or on behalf of the Company. These risks and
uncertainties include, but are not limited to, those relating to product and
service development activities, dependence on existing management, global
economic and market conditions, and changes in federal or state laws.
11
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
SIGNATURE
- --------------------------------------------------------------------------------
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.
CECO ENVIRONMENTAL CORP.
----------------------------
Phillip DeZwirek
Chief Financial Officer
Chief Executive Officer
Date: August 3, 1998
12
<PAGE>
CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES
APPENDIX A TO ITEM 601(c) OF REGULATION S-B
- --------------------------------------------------------------------------------
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF CECO ENVIRONMENTAL CORP. AND SUBSIDIARIES AS OF AND FOR
THE SIX MONTHS ENDED JUNE 30, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
ITEM NUMBER AMOUNT ITEM DESCRIPTION
- ----------- ------ ----------------
5-02(1) $ 269,327 Cash and cash items
5-02(2) 626,222 Marketable securities
5-02(3)(a)(1) 4,077,788 Notes and accounts receivable, trade
5-02(4) 0 Allowances for doubtful accounts
5-02(6) 725,379 Inventories
5-02(9) 6,696,432 Total current assets
5-02(13) 3,962,994 Property, plant and equipment
5-02(14) 1,869,960 Accumulated depreciation
5-02(18) 15,220,717 Total assets
5-02(21) 6,084,115 Total current liabilities
5-02(22) 1,904,858 Bonds, mortgages and similar debt
5-02(28) 0 Preferred stock, mandatory redemption
5-02(29) 0 Preferred stock, no mandatory redemption
5-02(30) 83,888 Common stock
5-02(31) 7,282,343 Other stockholders' equity
5-02(32) 15,220,717 Total liabilities and stockholders' equity
5-03(b)1(a) 4,190,720 Net sales of tangible products
5-03(b)1 13,079,061 Total revenues
5-03(b)2(a) 2,103,209 Cost of tangible goods sold
5-03(b)2 12,346,662 Total costs and expenses applicable to
sales and revenues
5-03(b)3 112,789 Other costs and expenses
5-03(b)5 0 Provision for doubtful accounts and notes
5-03(b)(8) 112,789 Interest and amortization of debt discount
5-03(b)(10) 655,055 Income (loss) before taxes and other items
5-03(b)(11) 276,000 Income tax expense (credit)
5-03(b)(14) 341,878 Income (loss) continuing operations
5-03(b)(15) 0 Discontinued operations
5-03(b)(17) 0 Extraordinary items
5-03(b)(18) 0 Cumulative effect, changes in
accounting principles
5-03(b)(19) 341,878 Net income or loss
5-03(b)(20) .04 Earnings (loss) per share, basic
5-03(b)(20) .04 Earnings (loss) per share, diluted
