SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): January 9, 1998
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PRAB, INC.
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(Exact name of registrant as specified in its charter)
Michigan 0-10187 38-1654849
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(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification No.)
5944 E. Kilgore Road, Kalamazoo, Michigan 49003
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (616) 382-8200
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Item 5. Other Events.
On January 9, 1998, the Company issued the following press release:
Prab, Inc. (the "Company") has revised its reported earnings for
fiscal years 1997 and 1996 to reclassify the Company's federal income tax
recoveries from earnings to paid-in capital (a component of stockholders'
equity).
The Company believes that its underlying value is not affected by the
reclassification because the reported federal income tax recoveries are not
changed or lost, but rather have been excluded from the computation of
earnings and added directly to paid-in capital. The reclassification has no
impact on the Company's pre-tax income, total stockholders' equity or cash
flow.
The reclassification of the Company's federal income tax recoveries
is required because the Company elected in 1995 to offset its deficit in
retained earnings against paid-in capital. The election was made by the
Company to reflect its improving financial performance. Accounting rules
applicable to companies that make such an election require that unrecognized
tax benefits at the time of the election that are subsequently recognized
must be reported as an increase in paid-in capital and not included in
earnings.
Accordingly, $709,000 and $614,000 of federal income tax recoveries
have been reclassified to paid-in capital for the years ended October 31,
1997 and 1996, respectively. The reclassification of these amounts has the
effect of reducing earnings for the year ended October 31, 1997 from
$1,608,000 to $899,000 and earnings for the year ended October 31, 1996 from
$1,373,000 to $759,000. Fourth quarter earnings have been revised to $424,000
and $226,000 for the quarters ended October 31, 1997 and 1996, respectively.
Earnings per share have been revised from $.72 per share to $.40 per share
and $.39 per share to $.19 per share for the year and quarter ended October
31, 1997, respectively.
Total stockholders' equity of $2,069,000 and $478,000 for the years
ended October 31, 1997 and 1996, respectively, were not affected by the
reclassification. As noted above, the reclassification has no impact on the
financial condition or operations of the Company.
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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 hereunto duly authorized.
Date: January 12, 1998 PRAB, INC.
By: /s/ Gary A. Herder
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Gary A. Herder
Its: President
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