<PAGE>
================================================================================
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended: March 1, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ____________ to ____________
Commission File Number: 0-10095
UNIT INSTRUMENTS, INC.
(Exact name of registrant as specified in its charter)
California 33-0077406
(State or other jurisdiction (I.R.S. Employer
of Incorporation) Identification Number)
22600 Savi Ranch Parkway, Yorba Linda, California 92887
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (714) 921-2640
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 XXX No
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Classes Outstanding at March 20, 1997:
--------------------------- ------------------------------
Common Stock $.15 Par Value 4,372,103
================================================================================
<PAGE>
UNIT INSTRUMENTS, INC.
INDEX
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
Part I. Financial Information
Condensed Consolidated Balance Sheets............................ 3-4
March 1, 1997 and May 31, 1996
Condensed Consolidated Statements of Operations.................. 5
Three months and nine months ended March 1, 1997
and March 2, 1996
Condensed Consolidated Statements of Cash Flows.................. 6
Nine months ended March 1, 1997 and March 2, 1996
Notes to Condensed Consolidated Financial Statements............ 7-8
Management's Discussion and Analysis of.......................... 9-12
Financial Condition and Results of Operations
Part II. Other Information
Item 6 Exhibits and Reports on Form 8-K..................... 13-15
</TABLE>
<PAGE>
PART I. FINANCIAL INFORMATION
UNIT INSTRUMENTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
as of March 1, 1997 and May 31, 1996
(amounts in thousands)
(unaudited)
<TABLE>
<CAPTION>
March 1, 1997 May 31, 1996
------------- ------------
<S> <C> <C>
ASSETS:
Current Assets:
Cash and cash equivalents $12,868 $14,572
Accounts and notes receivable 6,866 10,179
Inventories 9,672 9,709
Income taxes refundable 713 -0-
Deferred taxes 1,042 1,042
Prepaid expenses and other 449 191
------- -------
Total current assets 31,610 35,693
Property, plant and equipment, at cost:
Buildings and improvements 5,287 5,096
Machinery and equipment 14,135 11,732
------- -------
19,422 16,828
Accumulated depreciation and amortization 9,120 7,267
------- -------
10,302 9,561
Construction in progress 41 662
------- -------
Net property, plant and equipment 10,343 10,223
Goodwill, net of accumulated amortization of
$2,137 and $1,723, respectively 8,715 4,338
Deferred taxes 249 249
Other assets 1,136 2,277
------- -------
$52,053 $52,780
======= =======
</TABLE>
See accompanying notes to condensed consolidated financial statements.
3
<PAGE>
UNIT INSTRUMENTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
as of March 1, 1997 and May 31, 1996
(amounts in thousands)
(unaudited)
<TABLE>
<CAPTION>
March 1, 1997 May 31, 1996
-------------- -------------
LIABILITIES AND SHAREHOLDERS' EQUITY
<S> <C> <C>
Current liabilities:
Accounts payable $ 2,008 $ 1,969
Accrued compensation and benefits 1,375 1,786
Income taxes -0- 1,141
Current installments on term debt 1,691 1,845
Other current liabilities 2,432 2,228
------- -------
Total current liabilities 7,506 8,969
Deferred income taxes 343 -0-
Other long-term liabilities and deferred credits 709 587
------- -------
Total liabilities 8,558 9,556
Shareholders' equity:
Common stock, $.15 par value; authorized shares: 656 613
12,000,000; issued shares: 4,372,103 as of
March 1, 1997 and 4,090,146 as of
May 31, 1996
Additional paid-in capital 23,047 19,247
Retained earnings 20,216 23,673
Foreign currency translation (424) (309)
adjustment ------- -------
Total shareholders' equity 43,495 43,224
$52,053 $52,780
======= =======
</TABLE>
See accompanying notes to condensed consolidated financial statements.
4
<PAGE>
UNIT INSTRUMENTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
March 1, 1997 and March 2, 1996
(amounts in thousands, except share data)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
------------------------- -------------------------
03/01/97 03/02/96 03/01/97 03/02/96
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net sales $ 9,624 $ 17,232 $ 30,914 $ 47,801
Operating costs and expenses:
Cost of goods sold 7,499 10,563 23,976 28,867
Selling and administration 2,742 3,391 9,106 10,828
Restructuring costs -0- -0- 558 373
Research, development and engineering 862 985 3,064 2,762
---------- ---------- ---------- ----------
Operating income (loss) (1,479) 2,293 (5,610) 4,971
Interest income 219 191 629 469
Interest expense (15) (12) (41) (93)
Other income (expense), net (48) (46) (60) (67)
---------- ---------- ---------- ----------
Income (loss) from continuing operations
before income taxes (1,323) 2,426 (5,082) 5,280
Provision (benefit) for income taxes (423) 942 (1,626) 2,112
---------- ---------- ---------- ----------
Income (loss) from continuing operations (900) 1,484 (3,456) 3,168
Discontinued operations:
Income from discontinued operations net of income
tax provision of $521 for the nine month
period ended March 2, 1996 -0- -0- -0- 750
Gain on disposal net of income tax provision
of $1,011 for the nine month period ended
March 2, 1996 -0- -0- -0- 1,454
---------- ---------- ---------- ----------
Net income (loss) $ (900) $ 1,484 $ (3,456) $ 5,372
========== ========== ========== ==========
Per common share:
Income (loss) from continuing operations $(0.21) $0.34 $(0.79) $ 0.72
Income from discontinued operations -0- -0- -0- 0.49
---------- ---------- ---------- ----------
Net income (loss) per share $(0.21) $0.34 $(0.79) $ 1.21
========== ========== ========== ==========
Average shares used in computing earnings per share 4,370,000 4,318,000 4,376,000 4,420,000
========== ========== ========== ==========
Dividends per share $.00 $.00 $.00 $ .06
========== ========== ========== ==========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
5
<PAGE>
UNIT INSTRUMENTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
For the Nine Months Ended March 1, 1997 and March 2, 1996
(amounts in thousands)
(unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
-----------------------
<S> <C> <C>
03/01/97 03/02/96
--------- ---------
Cash Flows from Operating Activities:
Net income (loss) $ (3,456) $ 5,372
Adjustments to reconcile net income to
net cash provided from operating activities:
Depreciation and amortization 2,341 1,530
Deferred income taxes (1) 692
Gain on disposal of assets (1) -0-
Gain on sale of business -0- (1,454)
Changes in assets and liabilities net of effect of
businesses sold and acquired:
Accounts receivable 4,673 (1,008)
Inventories 1,912 (2,457)
Prepaids and other assets (187) (49)
Accounts payable and accrued liabilities (1,880) (1,088)
Income taxes (1,854) 531
Other liabilities 60 150
--------- ---------
Net cash flow provided from operating activities 1,607 2,219
Cash Flows from Investing Activities:
Capital expenditures (913) (4,156)
Net cash paid for acquisition of Control Systems, Inc. (1,127) -0-
Proceeds from asset sales 16 -0-
Change in short-term investments -0- 4,919
Net cash proceeds from sale of business -0 12,526
--------- ---------
Net cash provided from (used in) investing activities (2,024) 13,289
Cash Flows from Financing Activities:
Payments on long-term debt (254) (453)
Change in short-term borrowings, net (783) (963)
Cash dividends paid -0- (517)
Note receivable from sale of business -0- (750)
Purchase of company common stock (250) (2,584)
Stock option exercise, related tax benefit and other 116 338
--------- ---------
Net cash (used in) financing activities (1,171) (4,929)
Effect of exchange rate changes on cash and cash equivalents (116) (197)
--------- ---------
Net increase (decrease) in cash and cash equivalents (1,704) 10,382
Cash and cash equivalents at beginning of year 14,572 4,465
--------- ---------
Cash and cash equivalents at end of year $ 12,868 $ 14,847
========= =========
Supplemental disclosure of cash flow information:
Interest paid $ 41 $ 93
Income tax paid, net of refunds $ 231 $ 3,952
</TABLE>
See accompanying notes to condensed consolidated financial statements.
6
<PAGE>
UNIT INSTRUMENTS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(amounts in thousands)
1. Significant Accounting Policies
The condensed consolidated financial statements included herein are based
in part on estimates and include such adjustments (consisting solely of
normal, recurring adjustments) which management believes are necessary for
a fair presentation of the Company's financial position at March 1, 1997
and May 31, 1996, and the results of its operations for the three month and
nine month periods ended March 1, 1997 and March 2, 1996. The consolidated
financial statements and related notes are condensed and have been prepared
in accordance with generally accepted accounting principles applicable to
interim periods; consequently, they do not include all generally accepted
accounting disclosures required for complete annual financial statements.
These condensed consolidated financial statements should be read in
conjunction with the financial statements and notes thereto contained in
the Company's Annual Report on Form 10-K for the year ended May 31, 1996.
The results of operations for the period presented are not necessarily
indicative of results to be expected for the entire fiscal year. Certain
prior year items have been reclassified to conform to the current year
presentation.
2. Inventories
Inventories at March 1, 1997 and May 31, 1996 consisted of the following:
<TABLE>
<CAPTION>
March 1, 1997 May 31, 1996
------------- ------------
<S> <C> <C>
Raw materials $5,961 $6,514
Work in process 2,384 2,313
Finished goods 1,327 882
------ ------
Total inventories $9,672 $9,709
====== ======
</TABLE>
3. Acquisition of Control Systems, Inc.
The Company acquired Control Systems, Inc. ("CSI") on June 3, 1996 in
exchange for $1.2 million in cash and 289,000 shares of Company stock
valued at $3,977,000. The acquisition has been accounted for by using the
purchase method. Accordingly, the results of operations of CSI are
included with those of the Company for the three month and nine month
periods ended on March 1, 1997. A Current Report on Form 8-K was filed on
July 1, 1996 reporting this transaction.
7
<PAGE>
Also, a supplemental Current Report on Form 8K/A was filed on August 14,
1996 which provided financial statements and pro forma regarding the
acquisition.
The unaudited combined results of operations of the Company and CSI for the
three month and nine month periods ended March 2, 1996, after giving effect
for certain pro forma adjustments, are as follows:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
<S> <C> <C>
03/02/96 03/02/96
-------- --------
Net sales $20,134,000 $56,058,000
Income from continuing operations 1,402,000 3,119,000
Net income 1,402,000 5,323,000
Pro forma per share data
Income from continuing operations $ 0.30 $ 0.66
Net income $ 0.30 $ 1.13
</TABLE>
The foregoing unaudited pro forma results reflect three months and nine
months amortization of goodwill with an initial carrying value of
$4,790,000, resulting from the acquisition of CSI. The Company has
determined that the goodwill has an estimated 12-year life and, for
purposes of the pro forma adjustments, a 12-year amortization period has
been used.
4. Restructuring Charges
During the first and second quarters of the current fiscal year, the
Company reduced its workforce by 109 and 22 positions, respectively, in
response to the steep downturn in the semiconductor equipment market. This
workforce reduction represented approximately 26% of the Company's
worldwide employment. A restructuring charge of $262,000 was recorded in
the first quarter and $296,000 was recorded in the second quarter for costs
associated with the consolidation of certain facilities and for additional
severance related expenses.
In the first and second quarters of the prior fiscal year, restructuring
charges of $83,000 and $273,000, respectively, were recorded for expenses
associated with the sale of the Autoclave Engineers Group, which was sold
in September, 1995.
8
<PAGE>
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
The following discussion and analysis should be read in conjunction with Unit
Instruments, Inc.'s condensed consolidated financial statements and related
notes included herein.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 1, 1997 COMPARED TO THREE MONTHS ENDED MARCH 2, 1996
Sales from continuing operations for the third fiscal quarter ended March 1,
1997 decreased 44% to $9,624,000 from $17,232,000 for the comparable prior year
period. This sales decline resulted from lower industry-wide semiconductor
equipment orders and shipments. Semiconductor fabrication tools are the primary
application for the Company's mass flow controllers (MFCs) and the Company's
primary channel of distribution is through the manufacturers of semiconductor
processing equipment (OEMs). These OEMs have reported lower sales and a
precipitous decline in new orders over the past several quarters. In addition,
the OEMs have implemented aggressive inventory reduction programs that have
further reduced demand for the Company's products. Also impacted during the
quarter were sales of gas distribution systems through CSI because of reduced
capital spending by a major semiconductor manufacturer, which represents a
substantial portion of CSI's business. The decline in industry activity levels
impacted both the Company's domestic and international sales for the period.
However, during the third quarter, the Company experienced stronger order
activity as compared to the previous quarter. Because the Company only
maintains a few weeks of backlog, it is difficult to forecast future sales, but
recent order rates would indicate an upward trend.
Gross profit margin declined to 22% for the current quarter from 38% for the
third fiscal quarter last year. The sharply lower gross profit margin primarily
resulted from the corresponding rapid and steep decline in the Company's sales.
This resulted in under utilization of manufacturing facilities and reduced labor
efficiency, despite a large reduction in the Company's direct labor workforce.
Selling, general and administrative ("S,G&A") expenses decreased to $2,742,000
in the third quarter of the current fiscal year from $3,391,000 in the
comparable prior year period. As a percent to sales, S,G&A increased to 29%
from 20% last year. The reduction in expenses resulted from cost control
measures implemented in response to the sharp decline in sales, coupled with
selected layoffs of indirect employees.
Research, development and engineering expenses ("R&D") decreased by 13% to
$862,000, or 9% of sales, for the current quarter, from $985,000, or 6% of
sales, for the comparable prior year period. The reduction in R&D expenses was
minimized in order to maintain current capabilities of future product
development and sustaining engineering. Despite the current industry downturn,
the Company believes that the continued timely development of new products and
enhancements to its existing products is essential to maintaining its
competitive position within the industry. Accordingly, the Company anticipates
that such expenses will continue at approximately the same level in subsequent
periods.
9
<PAGE>
Interest income and interest expense increased slightly from the prior year
comparable periods.
A loss from continuing operations before income taxes of $1,323,000 was recorded
for the current period, as compared to income from continuing operations of
$2,426,000 for the corresponding prior year period. Income tax benefit was
provided for at a 32% rate for the third quarter, compared to a provision of 39%
for the prior year. The tax rate in both periods is unfavorably impacted by the
non-deductibility of goodwill amortization.
A net loss of $900,000, or $.21 per share, was recorded for the current fiscal
second quarter as compared to net income of $1,484,000, or $.34 per share, for
the prior year period.
NINE MONTHS ENDED MARCH 1, 1997 COMPARED TO NINE MONTHS ENDED
MARCH 2, 1996
Sales from continuing operations for the nine-month period ending March 1, 1997
decreased 35% to $30,914,000, from $47,801,000 for the comparable prior year
period. This sales decline is attributable to the industry downturn that
started approximately the middle of 1996 and intensified as the year progressed
before leveling off towards the end of 1996. Since the Company primarily sells
to the manufacturers of semiconductor processing equipment, its sales are
directly related to activity levels within this industry segment. In addition,
the Company's major customers have been aggressively reducing levels of
inventory, which has had a further negative impact on sales. Lastly, the
Company has a very limited backlog, because of a short production cycle, which
accentuates fluctuations in order rates. Sales of gas distribution systems,
through CSI, were down sharply for the nine month period because of reduced
capital spending by a major semiconductor manufacturer, which represents a
significant portion of CSI's business. The downturn in the semiconductor
equipment market has been worldwide and, as such, has negatively impacted both
domestic and international sales of the Company. However, recent order activity
indicates that sales in the near future may improve from the recent depressed
levels.
Gross profit margins decreased to 23% for the current nine month period from 40%
last year, primarily because of the rapid and steep decline in the Company's
sales. This, in turn, has resulted in under utilization of fixed overhead and
reduced labor efficiency. In addition to these factors, gross profit margin was
negatively impacted by higher warranty expense, which is attributable to higher
customer returns and fastener replacement on certain model MFCs.
Selling, general and administrative (S,G&A) expenses decreased 16% to $9,106,000
for the nine month period, but climbed as percent of sales to 30% for the
current period from 23% last year because of the sharp decline in the Company's
sales. Lower S,G&A expenses for the current period primarily resulted from
closure, last fiscal year, of the Company's Erie, Pennsylvania corporate office.
For the prior year's comparable period, expenses associated with the former
corporate office were $822,000. Also contributing to lower expense levels for
the current period were certain cost reduction actions and select layoffs of
indirect employees.
A restructuring charge of $558,000 was incurred during the first half of the
current fiscal year for severance related expenses and costs associated with the
consolidation of facilities. In last year's comparable period, a restructuring
charge of $373,000 was recorded for employee severance expense, legal fees and
other expenses associated with the closure of the Erie corporate office.
10
<PAGE>
Research, development and engineering expenses increased 11% from the prior year
period. The Company believes that the continued timely development of new
products and enhancements to its existing products is essential to maintaining
its competitive position within the industry. Accordingly, the Company
anticipates that such expenses will continue at approximately the same level for
subsequent periods.
Interest income increased to $629,000 from $469,000 the prior year because of
higher cash balances resulting from the divestiture of Autoclave Engineers Group
in fiscal 1996. Interest expense declined for the comparative period because of
lower levels of borrowing outstanding as all domestic credit facilities were
repaid during the second quarter of the prior fiscal year.
A loss from continuing operations before income taxes of $5,082,000 was
sustained in the current nine month period, primarily because of the precipitous
decline in the Company's sales level. For last year's comparable period, income
from continuing operations before income taxes was $5,280,000. The tax benefit
for the current period was provided for at a 32% rate versus a tax provision of
40% for the prior year period. The tax rate in both periods was negatively
effected by the non-deductibility of goodwill amortization.
The Company sold its Autoclave Engineers Group on September 22, 1995 and
recorded a gain on sale of $1,454,000, net of tax provision of $1,011,000,
during the second quarter of the prior fiscal year. In addition, income from
this discontinued operation of $750,000 was recorded in the prior year.
A net loss of $3,456,000, or $.79 per share, was recorded for the current nine
month period as compared to net income of $5,372,000, or $1.21 per share, for
the comparable prior year period.
FINANCIAL CONDITION
On June 3, 1996, the Company acquired all of the outstanding shares of CSI for
$1,200,000 cash and 289,000 shares of Company stock valued at $3,977,000. Prior
to the acquisition, the Company had advanced cash to CSI of $1,025,000.
Cash flow was a negative $1,704,000 for the nine month period ended March 1,
1997. The negative cash flow was considerably less than the accounting loss of
$3,456,000 for the period largely due to substantial net reductions of accounts
receivable and, to a lesser extent, a decrease in inventory, net of inventory
acquired with the CSI purchase. However, the positive cash flow impact of the
reduction in receivables and inventories was partially offset by cash used to
reduce accounts payable and the net cash used to acquire CSI.
Accounts receivable declined from $10,179,000 as of May 31, 1996 to $6,866,000
as of March 1, 1997 because of collections and a decline in replacement
receivables due to lower sales. Income taxes payable of $1,141,000, as of May
31, 1996, were eliminated and replaced with income taxes refundable of $713,000,
as of March 1, 1997, due to the loss incurred for the period and the capability
to deduct such losses against prior years' income via tax loss carryback
provisions.
Cash and cash equivalents were $12,868,000 as of March 1, 1997. The Company's
only debt outstanding is a Japanese Yen denominated credit facility through the
Company's Japanese subsidiary
11
<PAGE>
for approximately $1,800,000. During the prior fiscal year, the Company entered
into a $5 million unsecured credit facility with a major domestic bank. The
Company can use any portion of the credit facility for letters of credit and has
utilized approximately $2 million for such purpose. No borrowings were
outstanding at the end of the current quarter under this credit facility. The
Company expects that its current cash resources will be adequate to fund the
Company's anticipated near-term capital requirements.
FORWARD-LOOKING STATEMENT
This quarterly report on Form 10-Q contains certain forward-looking statements
made in good faith by the Company pursuant to the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995. In connection with these
"safe harbor" provisions, the Company identifies important factors that could
cause actual results to differ materially from those contained in any forward-
looking statements made by, or on behalf of, the Company. Any such statements
are qualified by reference to the following cautionary statements.
The Company's businesses operate in a highly competitive market and are subject
to many risks and uncertainties. Such risks and uncertainties include, but are
not limited to, the Company's dependency on a few large customers, reductions in
demand or rescheduling of purchase orders that have occurred because of the
severe downturn in the semiconductor industry, customers' desire to return
product previously sold due to overstock and/or obsolescence, expenses for
extended product warranty, lack of acceptance of the Company's products within
their respective markets, the replacement of the Company's products with new
technology, the potential change in competitive conditions within the markets
served by the Company, the failure to integrate the operations of its Control
Systems, Inc. subsidiary with the rest of its operations, the failure to retain
key technical and management personnel, material or adverse changes in the
Company's operations or business, failure to accurately anticipate demand for
the Company's products and the possibility that the trend in increased business
activity, as compared to recent reporting periods, will cease.
Although the Company believes that the assumptions underlying the forward-
looking statements are reasonable, any of the assumptions could prove inaccurate
and, therefore, there can be no assurance that the results contemplated in
forward-looking statements will be realized. In addition, the business and
operations of the Company are within a single industrial segment and are
dependent on a few large customers. This concentration on a single market and
limited customer base subjects the Company to substantial risks which increase
the uncertainty inherent in such forward-looking statements. In light of the
significant uncertainties inherent in the forward-looking information included
herein, the inclusion of such information should not be regarded as a
representation by the Company, or any other person, that the objectives or plans
for the Company will be achieved.
12
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit 11.1 - Computation of Earnings per Share
(b) No reports on Form 8-K were filed by the Company for the quarter
for which this report is filed.
(c) Financial Data Schedule
13
<PAGE>
UNIT INSTRUMENTS, INC. AND SUBSIDIARIES
SIGNATURES
Pursuant to the requirement 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.
UNIT INSTRUMENTS, INC.
----------------------
Registrant
Date: March 28, 1997 /S/ Michael J. Doyle
--------------------
Michael J. Doyle, President
and Chief Executive Officer
Date: March 28, 1997 /S/ Gary N. Patten
------------------
Gary N. Patten
Chief Financial Officer
14
<PAGE>
EXHIBIT 11.1
UNIT INSTRUMENTS, INC.
COMPUTATION OF EARNINGS PER SHARE
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
------------------ -----------------
03/01/97 03/02/96 03/01/97 03/02/96
--------- -------- -------- --------
<S> <C> <C> <C> <C>
INCOME (LOSS) FROM
CONTINUING OPERATIONS $ (900,000) $1,484,000 $(3,456,000) $3,168,000
---------- ---------- ----------- ----------
NET INCOME (LOSS) $ (900,000) $1,484,000 $(3,456,000) $5,372,000
========== ========== =========== ==========
Earnings Per Share
- ------------------
Weighted average number
of shares outstanding 4,370,325 4,079,859 4,378,529 4,147,929
Common share equivalents,
assuming exercise of stock
options and warrants -0- 238,345 -0- 271,839
---------- ---------- ----------- ----------
Average shares used in
computing earnings per share 4,370,325 4,318,204 4,378,529 4,419,768
========== ========== =========== ==========
Net income (loss) per share from
continuing operations $ (0.21) $ 0.34 $ (0.79) $ 0.72
---------- ---------- ----------- ----------
Net income (loss) per share $ (0.21) $ 0.34 $ (0.79) $ 1.21
========== ========== =========== ==========
Earnings Per Share Assuming Full Dilution
- ----------------------------------------
Weighted average number
of shares outstanding 4,370,325 4,079,859 4,378,529 4,147,929
Common share equivalents, assuming
exercise of stock options and warrants -0- 238,345 -0- 271,839
---------- ---------- ----------- ----------
Average shares used in computing
earnings per share 4,370,325 4,318,204 4,378,529 4,419,768
========== ========== =========== ==========
Net income (loss) per share from
continuing operations $ (0.21) $ 0.34 $ (0.79) $ 0.72
---------- ---------- ----------- ----------
Net income (loss) per share $ (0.21) $ 0.34 $ (0.79) $ 1.21
========== ========== =========== ==========
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAY-31-1997
<PERIOD-START> JUN-01-1996
<PERIOD-END> MAR-01-1997
<CASH> 12,868
<SECURITIES> 0
<RECEIVABLES> 6,866
<ALLOWANCES> 0
<INVENTORY> 9,672
<CURRENT-ASSETS> 2,204
<PP&E> 19,422
<DEPRECIATION> 9,120
<TOTAL-ASSETS> 52,053
<CURRENT-LIABILITIES> 7,506
<BONDS> 0
0
0
<COMMON> 656
<OTHER-SE> 42,839
<TOTAL-LIABILITY-AND-EQUITY> 52,053
<SALES> 30,914
<TOTAL-REVENUES> 30,914
<CGS> 23,796
<TOTAL-COSTS> 36,524
<OTHER-EXPENSES> 60
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 41
<INCOME-PRETAX> (5,082)
<INCOME-TAX> (1,626)
<INCOME-CONTINUING> (3,456)
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</TABLE>
