<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(X) Quarterly report pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934
( ) Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
______________________________
For the quarter ended March 31, 1996 Commission file No. 0-10723
BOLT TECHNOLOGY CORPORATION
---------------------------
(Exact name of Registrant as specified in its charter)
CONNECTICUT 06-077392
----------- ---------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation of organization)
FOUR DUKE PLACE, NORWALK, CONNECTICUT 06854
--------------------------------------------------------
(Address of principal executive officies) (Zip Code)
203-853-0700
------------
(Registrant's telephone number, including area code)
Indicate by a check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange of 1934
during the preceding 12 months (or for such shorter period that the registrant
was requried to file such reports), and (2) has been subject to such filing
requirements for the pasr 90 days. Yes X No __
-
The number of Shares outstanding of the Registrant's common stock as of April
17, 1996 was:
Common Stock, without par value - 4,971,431 shares
(1)
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
INDEX
-----
Page Number
-----------
Part I - Financial Information:
Consolidated statements of income - three and
nine months ended March 31, 1996 and 1995 3
Consolidated balance sheets -
March 31, 1996 (unaudited) and June 30, 1995 4
Consolidated statements of cash flows -
nine months ended March 31, 1996 and 1995 5
Notes to consolidated financial statements 6-7
Management's discussion and analysis of financial
condition and results of operations 8-10
Part II - Other Information:
Item 6 - Exhibits and reports on Form 8-K 10
Signatures 11
(2)
<PAGE>
PART I - FINANCIAL INFORMATION
BOLT TECHNOLOGY CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
_______________________________
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
------------------ -------------------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
REVENUES:
Sales.................................. $1,782,000 $1,426,000 $5,418,000 $4,463,000
Service................................ 167,000 375,000 437,000 789,000
Interest............................... 6,000 - 9,000 -
---------- ---------- --------- ----------
1,955,000 1,801,000 5,864,000 5,252,000
---------- ---------- --------- ----------
COSTS AND EXPENSES:
Cost of sales......................... 913,000 819,000 2,884,000 2,508,000
Cost of service....................... 187,000 255,000 627,000 640,000
Research and development.............. 42,000 51,000 120,000 152,000
Selling, general and administrative... 520,000 418,000 1,462,000 1,281,000
Interest.............................. 6,000 17,000 20,000 43,000
---------- ---------- ---------- ----------
1,668,000 1,560,000 5,113,000 4,624,000
---------- ---------- ---------- ----------
Income before provision for income
taxes.................................. 287,000 241,000 751,000 628,000
Provision for income taxes................ 10,000 - 10,000 -
---------- ---------- ---------- ----------
Net income............................. $ 277,000 $ 241,000 $ 741,000 $ 628,000
========== ========== ========== ==========
Net income per common share............... $0.06 $0.05 $0.15 $0.12
========== ========== ========== ==========
Weighted average common and common
equivalent shares outstanding.......... 4,971,431 4,971,431 4,971,431 5,210,520
========== ========== ========== ==========
</TABLE>
See Notes to Consolidated Financial Statements.
(3)
<PAGE>
BOLT TECHNOLOGY CORPORATION
CONSOLIDATED BALANCE SHEETS
---------------------------
ASSETS
------
<TABLE>
<CAPTION>
March 31, June 30,
1996 1995
(unaudited)
----------- --------
<S> <C> <C>
Current Assets:
Cash and cash equivalents........... $748,000 $59,000
Accounts receivable, net............ 1,646,000 1,961,000
Inventories......................... 1,705,000 1,653,000
Other............................... 485,000 477,000
---------- ----------
Total current assets 4,584,000 4,150,000
---------- ----------
Property and Equipment, net............ 105,000 131,000
---------- ----------
Other Assets........................... 651,000 641,000
---------- ----------
$5,340,000 $4,922,000
========== ==========
</TABLE>
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
<TABLE>
<S> <C> <C>
Current Liabilities:
Notes payable........................ $ - $103,000
Accounts payable..................... 450,000 682,000
Accrued liabilities.................. 487,000 475,000
---------- ----------
Total current liabilities 937,000 1,260,000
---------- ----------
Stockholders' Equity:
Common stock,without par value....... 24,660,000 24,660,000
Accumulated deficit.................. (20,257,000) (20,998,000)
---------- ----------
Total stockholders' equity............. 4,403,000 3,662,000
---------- ----------
$5,340,000 $4,922,000
========== ==========
</TABLE>
See Notes to Consolidated Financial Statements.
(4)
<PAGE>
BOLT TECHNOLOGY CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
__________________________________
<TABLE>
<CAPTION>
Nine Months Ended
March 31,
---------------------
1996 1995
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income............................................ $741,000 $628,000
Adjustments to reconcile net income to
cash provided by operating activities:
Depreciation....................................... 46,000 36,000
-------- --------
787,000 664,000
Change in Operating Assets and Liabilities
Accounts receivable................................ 315,000 (557,000)
Inventories........................................ (52,000) (84,000)
Other assets....................................... (18,000) (30,000)
Accounts payable and accrued liabilities........... (220,000) 58,000
-------- --------
Net cash provided by operating activities.......... 812,000 51,000
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment.................... (20,000) (62,000)
-------- --------
Net cash used in investing activities.............. (20,000) (62,000)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Purchase of Warrant................................... - (300,000)
Net (decrease) increase in borrowings under revolving
credit facility...................................... (103,000) 272,000
Exercise of stock options............................. - 3,000
-------- --------
Net cash used in financing activities.............. (103,000) (25,000)
-------- --------
NET INCREASE (DECREASE) IN CASH $689,000 $(36,000)
======== ========
INTEREST PAID $25,000 $51,000
======== ========
INCOME TAXES PAID $13,000 $3,000
======== ========
</TABLE>
See Notes to Consolidated Financial Statements.
(5)
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
-------------------------------------------
(UNAUDITED)
-----------
NOTE-1- BASIS OF PRESENTATION
-----------------------------
The consolidated balance sheet as of March 31, 1996, the consolidated
statements of income for the three-month and nine-month periods ended March 31,
1996 and 1995 and the consolidated statements of cash flows for the nine-month
periods ended March 31, 1996 and 1995 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. It is suggested that the March 31, 1996 consolidated financial state-
ments be read in conjunction with the consolidated financial statements and
notes included in the Company's Annual Report on Form 10-K for the year ended
June 30, 1995.
NOTE 2 - NOTES PAYABLE
- ----------------------
The Company has a revolving credit facility with a domestic bank which
allows for borrowings up to $2,250,000 determined by a formula based upon 85% of
eligible accounts receivable, inventory and equipment. At March 31, 1996 there
were no borrowings outstanding under this agreement. Maximum borrowings
available at March 31, 1996 were $1,093,000. The agreement will expire in July
1997, unless renewed and has an interest rate of 1 1/2% over the bank's prime
rate. The Company also pays an annual fee equal to 1% of the facility limit.
The lender has a first priority security interest in all of the Company's
assets and, under the agreement, the Company must, among other things, maintain
no less than $930,000 of net worth. The Company is restricted from paying
dividends during the term of the loan agreement.
NOTE 3 - INCOME TAXES
- ---------------------
At March 31, 1996, the Company had net operating loss carry-forwards for
federal income tax purposes of approximately $17,100,000 which expire in the
years 2001 through 2007. Management has recorded a net tax asset of $1,037,000
relating to the expected future benefits of the net operating loss carry-
forwards and other deductible temporary differences expected to be realized
during the carry-forward periods.
At March 31, 1996, current deferred tax assets of $408,000 were included
in the consolidated balance sheet under caption "Other" and $629,000 of non-
current deferred tax assets were included in the balance sheet under caption
"Other Assets".
In the third quarter of fiscal 1996, the Company recorded a provision for
state income taxes of $10,000. Under the provisions of FAS No. 109, no federal
income provision is required because of available net operating loss carry-
forwards.
(6)
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------
(CONTINUED)
-----------
NOTE 4 - INVENTORIES
- --------------------
Inventories, net of reserves, are comprised of the following:
<TABLE>
<CAPTION>
March 31, June 30,
1996 1995
---- ----
<S> <C> <C>
Raw materials and sub-assemblies.. $1,484,000 $1,526,000
Work-in process................... 221,000 127,000
---------- ----------
$1,705,000 $1,653,000
========== ==========
</TABLE>
NOTE 5 - PROPERTY AND EQUIPMENT
- --------------------------------
Property and equipment are comprised of the following:
<TABLE>
<CAPTION>
March 31, June 30,
1996 1995
---- ----
<S> <C> <C>
Building and leasehold improvements.. $ 534,000 $ 534,000
Geophysical equipment................ 2,682,000 2,674,000
Machinery and equipment.............. 4,028,000 4,104,000
Equipment held for rental............ 822,000 1,316,000
----------- -----------
8,066,000 8,628,000
Less accumulated depreciation.... (7,961,000) (8,497,000)
----------- -----------
$ 105,000 $ 131,000
=========== ===========
</TABLE>
(7)
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
---------------------------------------
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
A summary of the Company's financial position follows:
<TABLE>
<CAPTION>
(In thousands)
--------------
March 31, June 30, June 30, June 30,
1996 1995 1994 1993
--------- -------- -------- --------
<S> <C> <C> <C> <C>
Working capital....... $3,647 $2,890 $1,873 $ 773
Stockholders' equity.. 4,403 3,662 2,006 930
Bank borrowings....... - 103 257 2,136
</TABLE>
Cash and cash equivalents increased $689,000 from June 30, 1995 to March
31, 1996. Cash provided by operating activities for the nine months ended March
31, 1996 was $812,000 offset by cash used in investing activities of $20,000 and
cash used in financing activities of $103,000.
Trade accounts receivables decreased by $315,000 due to improved
collections. Management intends to focus efforts on maintaining days' sales
outstanding within a 70 to 80 day range.
Total current liabilities decreased $323,000 from June 30, 1995 due to the
elimination of borrowings under the Company's credit facility and earlier
payment of vendor invoices because of improved cash flow.
Capital expenditures amounted to $20,000 for the first nine months of
fiscal 1996. The Company anticipates that expenditures for the current fiscal
year will not exceed $50,000 and will be funded through cash flow from
operations.
The Company's internal sources of liquidity are existing cash balances and
cash flow from operations. The Company's external sources of liquidity are trade
credit from vendors and borrowings available under the Company's credit
facility. The Company believes these sources will be adequate to provide
required liquidity in the forseeable future.
(8)
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
-------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS
-----------------------------------
RESULTS OF OPERATIONS
- ---------------------
Revenue for the three-month and six-month periods ended March 31, 1996 and
1995 were comprised of the following (000's omitted):
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
------------------ -----------------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Sales:
Marine equipment $1,763 $1,385 $5,323 $4,342
Land equipment 19 41 95 121
------ ------ ------ ------
1,782 1,426 5,418 4,463
------ ------ ------ ------
Service:
Data acquisition 167 375 437 789
------ ------ ------ ------
Interest 6 - 9 -
------ ------ ------ ------
Total Revenue $1,955 $1,801 $5,864 $5,252
====== ====== ====== ======
</TABLE>
Total revenue increased 9% for the third quarter of 1996 and 12% for the
first nine months of fiscal 1996. Both the continued acceptance of the Company's
long-life guns and the wider application of three dimensional seismic surveys
have contributed to the increase in marine equipment sales.
Partially offsetting the increase in marine equipment sales was reduced
service revenue from Wellseis(R) operations which decreased $208,000 for the
quarter and $352,000 for the nine-month period. The decreases have been a result
of equipment problems which delayed scheduled work and the lower demand for this
service.
Cost of sales as a percentage of sales improved from 57% to 51% in the
third quarter principally from improved margins on long-life guns and
replacement parts sales and improved utilization afforded by increased equipment
sales. Cost of sales as a percentage of sales improved from 56% to 53% for the
nine-month period because of the reasons noted above and improved margins from
the rental of land seismic units.
Cost of service decreased $68,000 for the quarter and $13,000 for the nine-
month period. The lower level of expenditures was related to the reduced level
of revenue for each period.
(9)
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
-------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
-----------------------------------------------
RESULTS OF OPERATIONS (CONT'D.)
- ---------------------
Other operating expenses (research and development and selling, general and
administrative expenses) increased $93,000 for the quarter and $149,000 for the
nine months ended March 31, 1996. The increases for the quarter and nine-month
period were the result of higher personnel costs and an increase in the
provision for bad debts.
Interest expense decreased $11,000 for the quarter and $23,000 for the
nine-month period because of reduced borrowings under the Company's credit
facility.
In the third quarter of fiscal 1996, the Company recorded a provision for
state income taxes of $10,000. Under the provisions of FAS No. 109, no federal
income tax provision is required because of available net operating loss carry-
forwards.
PART II - OTHER INFORMATION
---------------------------
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
- -----------------------------------------
(a) Exhibits.
--------
(11) Statement re computation of earnings per share.
(27) Financial data schedule.
(b) Reports on Form 8-K.
-------------------
No reports on Form 8-K were filed by the Company during January,
February or March 1996.
(10)
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
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.
/s/ Raymond M. Soto
----------------------------
President and Treasurer
(Principal Executive Officer and
Principal Financial Officer)
/s/ Alan Levy
----------------------------------
Vice President-Finance and
Secretary
(Principal Accounting Officer
April 25, 1996
(11)
<PAGE>
EXHIBIT 11
PART II - EXHIBIT 11
Computation of Net Income per Share of Common Stock
---------------------------------------------------
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
------------------ -----------------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Weighted average shares of common stock
outstanding 4,971,431 4,971,431 4,971,431 4,966,116
Shares issuable from assumed exercise
of stock options and warrants. 107,694 55,786 117,553 275,449
---------- ---------- ---------- ----------
Weighted average shares outstanding,
as adjusted 5,079,125 5,027,217 5,088,984 5,241,565
========== ========== ========== ==========
Net income $ 277,000 $ 241,000 $ 741,000 $ 628,000
========== ========== ========== ==========
Net income per common share $ 0.05 $ 0.05 $ 0.15 $ 0.12
========== ========== ========== ==========
</TABLE>
In accordance with Accounting Principles Board Opinion No. 15, the inclusion of
common stock equivalents in the computation of earnings per share need not be
considered if the reduction in earnings per share is less than 3%. Therefore,
net income per common share and common share equivalent as shown on the
Consolidated Statements of Income for the three months ended March 31, 1996 and
1995 and the nine months ended March 31, 1996 do not include common share
equivalents.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATMENTS FOR THE PERIOD ENDING MARCH 31, 1996 AND IS QUALIFIED IN
ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-START> JUL-01-1995
<PERIOD-END> MAR-31-1996
<CASH> 748,000
<SECURITIES> 0
<RECEIVABLES> 1,646,000
<ALLOWANCES> 0
<INVENTORY> 1,705,000
<CURRENT-ASSETS> 4,584,000
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 5,340,000
<CURRENT-LIABILITIES> 937,000
<BONDS> 0
<COMMON> 24,660,000
0
0
<OTHER-SE> (20,257,000)
<TOTAL-LIABILITY-AND-EQUITY> 5,340,000
<SALES> 5,418,000
<TOTAL-REVENUES> 5,864,000
<CGS> 2,884,000
<TOTAL-COSTS> 3,511,000
<OTHER-EXPENSES> 1,582,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 20,000
<INCOME-PRETAX> 751,000
<INCOME-TAX> 10,000
<INCOME-CONTINUING> 741,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 741,000
<EPS-PRIMARY> 0.15
<EPS-DILUTED> 0.15
</TABLE>
