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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
*****************
For Quarter Ended June 30, 1995 Commission file number 0-5240
VERSA TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 39-1143618
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9301 Washington Avenue, Racine, Wisconsin 53406
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 414/886-1174
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. X YES _______ NO
Common stock outstanding as of July 28, 1995 - 5,974,572 shares.
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FORM 10-Q 6/30/95
VERSA TECHNOLOGIES, INC.
AND SUBSIDIARIES
I-N-D-E-X
Exhibit Reference
or Form 10-Q
Page Number
-----------------
PART I FINANCIAL INFORMATION
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<S> <C>
Item 1 Financial Statements
Consolidated Balance Sheets 10-Q, Page 3
June 30, 1995 (Unaudited)
and March 31, 1995
Consolidated Statements of Earnings 10-Q, Page 4
Three months ended June 30, 1995
and 1994 (Unaudited)
Consolidated Statements of Cash Flows 10-Q, Page 5
Three months ended June 30, 1995
and 1994 (Unaudited)
Notes to Consolidated Financial Statements 10-Q, Page 6
(Unaudited)
Item 2 Management's Discussion and Analysis 10-Q, Page 8
of Financial Condition and Results of Operations
</TABLE>
PART II OTHER INFORMATION
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Item 6 Exhibits and Reports on Form 8-K 10-Q, Page 9
</TABLE>
2
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FORM 10-Q 6/30/95
VERSA TECHNOLOGIES, INC.
BALANCE SHEETS*
<TABLE>
<CAPTION>
June 30, March 31,
1995 1995
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 16,404 $ 15,967
Receivables, net of allowances 9,479 9,404
Inventories 8,787 7,808
Prepaid expenses and taxes 1,425 1,733
-------- --------
Total current assets 36,095 34,912
PROPERTY, PLANT, AND EQUIPMENT** 20,290 19,945
INTANGIBLES 1,553 1,562
OTHER ASSETS 283 361
-------- ---------
$ 58,221 $ 56,780
======== ========
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Accounts payable $ 2,521 $ 1,750
Accrued expenses 3,096 3,401
Income taxes 923 495
Employee stock savings plan 136 119
-------- --------
Total current liabilities 6,676 5,765
DEFERRED INCOME TAXES 507 485
DEFERRED PENSION, DEFERRED
COMPENSATION AND POSTRETIREMENT
BENEFITS EXPENSE 2,507 2,462
SHAREHOLDERS' EQUITY 48,531 48,068
------- -------
$ 58,221 $ 56,780
======== ========
</TABLE>
* In thousands of dollars. March 31, 1995 figures condensed from audited
financial statements.
** Net of accumulated depreciation of $24,006,000 at June 30, 1995 and
$23,231,000 at March 31, 1995.
3
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FORM 10-Q 6/30/95
VERSA TECHNOLOGIES, INC.
STATEMENTS OF EARNINGS (UNAUDITED)*
<TABLE>
<CAPTION>
Three Months ended June 30, 1995 1994
<S> <C> <C>
NET SALES $ 16,989 $ 16,783
Cost of Sales 11,762 11,485
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GROSS PROFIT 5,227 5,298
Selling and administrative expenses 3,052 3,011
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OPERATING INCOME 2,175 2,287
------- -------
OTHER INCOME
Interest income 223 184
Miscellaneous, net 30 11
-------- --------
253 195
------- -------
EARNINGS BEFORE INCOME TAXES 2,428 2,482
INCOME TAXES 880 925
------- -------
NET EARNINGS $ 1,548 $ 1,557
======= =======
NET EARNINGS PER SHARE $ 0.26 $ 0.26
======== ========
Average shares outstanding 6,012 6,031
======== ========
</TABLE>
* Amounts are in thousands except earnings per share. Interim results are not
necessarily indicative of full year and are subject to audit.
4
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FORM 10-Q 6/30/95
VERSA TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)*
Increase in Cash and Cash Equivalents
<TABLE>
<CAPTION>
Three months ended June 30, 1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 1,548 $ 1,557
Depreciation and amortization 816 775
Provision for losses on accounts receivable 18 15
Increase in current assets other than cash
and cash equivalents (763) (72)
Increase in current liabilities 911 932
Increase in deferred liabilities 67 40
Gain on disposition of equipment - 5
--------- ---------
Net cash provided by operating activities 2,597 3,252
------ -------
Cash flows from investing activities:
Capital expenditures (1,154) (724)
Other 79 4
-------- -------
Net cash used in investing activities (1,075) (720)
------- -------
Cash flows from financing activities:
Dividends paid (541) (482)
Purchase of treasury stock (624)
Sale of stock under option plans 80 119
------- ------
Net cash used in financing activities (1,085) (363)
------- --------
Increase in cash and cash equivalents 437 2,169
Cash and cash equivalents at beginning of period 15,967 17,611
------- -------
Cash and cash equivalents at end of period $16,404 $19,780
======= =======
Supplemental Disclosures of Cash Flow Information
Cash paid during period for:
Income taxes $ 430 $ 340
</TABLE>
* Amounts are in thousands.
5
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FORM 10-Q 6/30/95
NOTES TO FINANCIAL STATEMENTS
1. Accounting Policies --
The consolidated balance sheet as of June 30, 1995 and the related
consolidated statements of earnings and cash flows for the three-
month periods ended June 30, 1995 and 1994 are unaudited. In the
opinion of management, all adjustments necessary for a fair
presentation of such financial statements have been included. Such
adjustments consisted only of normal recurring items. Interim results
are not necessarily indicative of results for a full year.
The financial statements and notes are presented as permitted by Form
10-Q, and do not contain certain information included in the annual
financial statements and notes of Versa Technologies, Inc. and
subsidiaries for the year ended March 31, 1995.
2. Inventories --
Interim inventories are based on perpetual records which are partially
verified by interim physical counts.
3. Shareholders' Equity --
Shareholders' equity is composed of the following elements (in
thousands):
<TABLE>
<CAPTION>
June 30, March 31,
1995 1995
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<S> <C> <C>
Common stock, par value $.01 per share $ 61 $ 61
Additional paid-in capital 18,676 18,710
Retained earnings 31,004 29,997
-------- -------
49,741 48,768
Less treasury shares at cost 1,210 700
-------- --------
$48,531 $48,068
======= =======
</TABLE>
Total shares of common stock outstanding net of treasury shares was
5,974,572 at June 30, 1995 and 6,011,822 at March 31, 1995.
6
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FORM 10-Q 6/30/95
During the three months ended June 30, 1995, 7,750 shares of treasury
stock were re-issued under the provision of the Company's 1982
Incentive Stock Option Plan (the 1982 Plan), and the Company's 1992
Incentive Stock Option Plan (the 1992 Plan). Treasury stock cost basis
in excess of the proceeds received was charged to additional paid-in
capital.
As of June 30, 1995, 101,094 shares of common stock were reserved for
issue under the Company's 1982 Plan; 297,000 shares were reserved for
issue under the Company's 1992 Plan; 13,504 shares were reserved for
issue under the Company's 1993 Plan; and 40,100 shares were reserved
for non-qualified stock options held by outside directors and an
outside officer of the Company.
During the three months ended June 30, 1995, retained earnings was
credited with net income of $1,548,000 and charged with $541,000 for
dividends paid.
4. Earnings Per Share Calculation --
Earnings per share have been computed on the basis of weighted average
shares outstanding during the respective interim periods. Common
share equivalents were excluded because their dilutive effect is not
significant.
7
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FORM 10-Q 6/30/95
Item 2 - Management's Discussion and Analysis of Financial Condition and
Results of Operations
Consolidated sales for the three months increased $206,000, or 1% from the
prior year. On a divisional basis, the comparative sales in thousands were as
follows:
<TABLE>
<CAPTION>
Three Months
-------------
1995 1994
---- -----
<S> <C> <C>
Custom Components $5,688 $7,405
Fluid Power 7,881 6,930
Medical 3,697 2,706
Less - interdivisional sales (277) (258)
----- -----
$16,989 $16,783
======= =======
</TABLE>
For the Custom Components Group, sales were down $1,717,000, or 23%. This drop
in volume resulted in a small operating loss. Volume decreased due primarily
to three factors. First, automotive related business was down $639,000.
Second, a project for the business machine market which was lost during the
third quarter of fiscal 1995 had shipments of $676,000 during the first quarter
last year. Third, shipments for an end of life project for the business
machine market were off $195,000.
Sales and operating income at the Fluid Power Group grew 14% and 19%,
respectively. Milwaukee Cylinder posted double digit gains in both sales and
operating income as a result of increased demand across a broad range of
customers. Power Gear had another good quarter with all three of its core
product lines contributing favorably. The quarter also marked the first
shipments of Power Gear's newest product line -- the drive mechanism for
slide-out rooms in the recreational vehicle market.
The Company's medical business had an excellent quarter, with operating income
up significantly on a sales increase of 37%. The sales increase was due to
gains in market share across several product lines. A combination of product
mix, higher volume and improved operating efficiencies resulted in improved
operating income.
Cash Flows and Liquidity
Cash provided from operating activities was $2.6 million for the quarter, down
from $3.3 million for the same period last year. This decrease was due to a
$980,000 increase in inventory. Inventories at Custom Components, Medical, and
Fluid Power increased $320,000, $211,000 and $446,000, respectively. The
increase at the Custom Components Group was the result of a larger than
anticipated drop in volume. For the Medical Group, while inventory increased,
inventory turns were unchanged. Fluid Power's inventories were up due to the
combination of increased lead times for certain materials at Milwaukee
Cylinder, plus the introduction of the new product at Power Gear.
8
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FORM 10-Q 6/30/95
Commitments for capital expenditures (investing activities) did not include any
significant amounts in excess of a normal level of replacement and improvements
to facilities and equipment.
Under the Company's program to repurchase up to 10% of its shares, 45,000
shares were acquired for $624,000 during the quarter. To date 87,500 shares
have been repurchased under the plan at a cost of $1,193,000.
At June 30, 1995 the Company had working capital of $29,418,000. Working
capital consisted of $16,404,000 of cash and cash equivalents. Management
anticipates that this liquidity plus internally generated funds provided by
operations will be sufficient to cover known demands for uses of working
capital.
Outlook
Order backlog on June 30, 1995 was $14,465,000 versus $11,809,000 one year ago.
Backlog at both Medical and Fluid Power increased while Custom Component's
backlog was flat.
PART II OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K
(a) There are no documents filed as part of this report.
(b) Reports on Form 8-K
There were no form 8-K's filed during the quarter.
9
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FORM 10-Q 6/30/95
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 to sign on behalf of the registrant and
as principal financial officer.
VERSA TECHNOLOGIES, INC.
(Registrant)
Date: August 10, 1995 /s/ Robert M. Sukalich
Vice President-Finance, Treasurer
and Principal Financial Officer
10
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<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the June 30,
1995 interim financial statements of First Manistique Corporation and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1996
<PERIOD-START> APR-01-1995
<PERIOD-END> JUN-30-1995
<CASH> 16,404,000
<SECURITIES> 0
<RECEIVABLES> 9,659,000
<ALLOWANCES> (180,000)
<INVENTORY> 8,787,000
<CURRENT-ASSETS> 36,095,000
<PP&E> 44,297,000
<DEPRECIATION> (24,007,000)
<TOTAL-ASSETS> 58,221,000
<CURRENT-LIABILITIES> 6,676,000
<BONDS> 0
<COMMON> 61,000
0
0
<OTHER-SE> 48,470,000
<TOTAL-LIABILITY-AND-EQUITY> 58,221,000
<SALES> 16,989,000
<TOTAL-REVENUES> 16,989,000
<CGS> 11,762,000
<TOTAL-COSTS> 11,762,000
<OTHER-EXPENSES> 3,052,000
<LOSS-PROVISION> 18,000
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 2,428,000
<INCOME-TAX> 880,000
<INCOME-CONTINUING> 1,548,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,548,000
<EPS-PRIMARY> .26
<EPS-DILUTED> .26
</TABLE>
