<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended: March 31, 2000
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: 0-10723
BOLT TECHNOLOGY CORPORATION
(Exact name of registrant as specified in its charter)
Connecticut 06-0773922
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Four Duke Place, Norwalk, Connecticut 06854
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (203) 853-0700
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 required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes [X] No [_]
At April 19, 2000 there were 5,391,378 shares of common stock, without par
value, outstanding.
1
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
INDEX
-----
<TABLE>
<CAPTION>
Page Number
-----------
<S> <C>
Part I - Financial Information:
Item 1. Financial Statements.
Consolidated statements of income - three and nine months ended
March 31, 2000 and 1999............................................ 3
Consolidated balance sheets -
March 31, 2000 and June 30, 1999................................... 4
Consolidated statements of cash flows -
nine months ended March 31, 2000 and 1999.......................... 5
Notes to consolidated financial statements......................... 6-10
Item 2. Management's discussion and analysis of financial
condition and results of operations............................. 11-14
Item 3. Quantitative and Qualitative Disclosures about Market Risk...... 14
Part II - Other Information:
Item 6. Exhibits and reports on Form 8-K................................ 14
Signatures......................................................... 15
</TABLE>
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,
------------------ -----------------
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenues:
Sales.................................................... $3,984,000 $ 4,618,000 $11,275,000 $15,827,000
---------- ----------- ----------- -----------
Costs and Expenses:
Cost of sales............................................ 2,212,000 2,460,000 5,964,000 8,149,000
Research and development................................. 91,000 127,000 297,000 289,000
Selling, general and administrative...................... 1,133,000 893,000 3,267,000 2,737,000
Amortization of intangibles.............................. 164,000 57,000 495,000 171,000
Interest expense......................................... 123,000 - 397,000 -
Interest income.......................................... (17,000) (46,000) (70,000) (109,000)
---------- ----------- ----------- -----------
3,706,000 3,491,000 10,350,000 11,237,000
---------- ----------- ----------- -----------
Income before income taxes.................................... 278,000 1,127,000 925,000 4,590,000
Provision for income taxes.................................... 140,000 419,000 442,000 566,000
---------- ----------- ----------- -----------
Net Income............................................... $ 138,000 $ 708,000 $ 483,000 $ 4,024,000
========== =========== =========== ===========
Earnings per share:
Basic........................................................ $ 0.03 $ 0.13 $ 0.09 $ 0.76
Diluted...................................................... $ 0.03 $ 0.13 $ 0.09 $ 0.75
Shares Outstanding:
Basic........................................................ 5,391,378 5,306,886 5,383,378 5,267,415
Diluted...................................................... 5,405,305 5,365,893 5,409,155 5,363,079
</TABLE>
See Notes to Consolidated Financial Statements.
3
<PAGE>
BOLT TECHNOLOGY CORPORATION
CONSOLIDATED BALANCE SHEETS
---------------------------
<TABLE>
<CAPTION>
ASSETS
------
March 31, June 30,
2000 1999
(unaudited)
----------- -----------
<S> <C> <C>
Current Assets:
Cash and cash equivalents........................................... $ 2,289,000 $ 3,500,000
Accounts receivable, net............................................ 2,710,000 2,208,000
Inventories......................................................... 4,850,000 5,413,000
Deferred income taxes............................................... 1,055,000 1,091,000
Other............................................................... 155,000 161,000
----------- -----------
Total current assets........................................... 11,059,000 12,373,000
----------- -----------
Goodwill, net............................................................ 12,169,000 12,610,000
Property and Equipment, net.............................................. 1,322,000 1,433,000
Deferred Income Taxes.................................................... 1,109,000 1,403,000
Other Assets............................................................. 53,000 68,000
----------- -----------
Total assets................................................... $25,712,000 $27,887,000
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current Liabilities:
Current maturities of long-term debt................................ $ 1,700,000 $ 1,700,000
Accounts payable.................................................... 653,000 549,000
Accrued liabilities................................................. 867,000 1,748,000
Income taxes payable................................................ 96,000 725,000
----------- -----------
Total current liabilities...................................... 3,316,000 4,722,000
Long-term Debt........................................................... 4,025,000 5,300,000
----------- -----------
Total liabilities.............................................. 7,341,000 10,022,000
Stockholders' Equity:
Common Stock........................................................ 26,140,000 26,117,000
Accumulated deficit................................................. (7,769,000) (8,252,000)
----------- -----------
Total stockholders' equity.......................................... 18,371,000 17,865,000
----------- -----------
Total liabilities and stockholders' equity..................... $25,712,000 $27,887,000
=========== ===========
</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,
-----------------
2000 1999
---- ----
<S> <C> <C>
Cash Flows From Operating Activities:
Net income.......................................................... $ 483,000 $ 4,024,000
Adjustments to reconcile net income to
cash provided by operating activities:
Depreciation and amortization.................................. 707,000 214,000
Deferred income taxes.......................................... 360,000 293,000
------------ -----------
1,550,000 4,531,000
Changes in operating assets and liabilities:
Accounts receivable............................................ (502,000) 1,900,000
Inventories.................................................... 563,000 (299,000)
Other assets................................................... (16,000) (224,000)
Accounts payable and accrued liabilities....................... (777,000) (865,000)
Income taxes payable........................................... (679,000) -
------------ -----------
Net cash provided by operating activities................. 139,000 5,043,000
------------ -----------
Cash Flows From Investing Activities:
Purchase of property and equipment.................................. (98,000) (75,000)
------------ -----------
Net cash used in investing activities.......................... (98,000) (75,000)
------------ -----------
Cash Flows From Financing Activities:
Repayment of long-term debt......................................... (1,275,000) -
Exercise of stock options........................................... 23,000 41,000
------------ -----------
Net cash (used in) provided by financing activities............ (1,252,000) 41,000
------------ -----------
Net (decrease) increase in cash and cash equivalents..................... $ (1,211,000) $ 5,009,000
============ ===========
Supplemental disclosure of cash flow information:
Income taxes paid................................................... $ 870,000 $ 382,000
Interest paid....................................................... $ 397,000 -
</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, 2000, the consolidated
statements of income for the three month and nine month periods ended March 31,
2000 and 1999 and the consolidated statements of cash flows for the nine month
periods ended March 31, 2000 and 1999 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, 2000 consolidated financial
statements 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, 1999.
Note 2 - Acquisition
- --------------------
In April 1999, the Company acquired all of the outstanding common stock of
A-G Geophysical Products, Inc. ("AG"). AG manufactures underwater electrical
connectors and cables, air gun signature hydrophones and pressure transducers
used in the marine seismic industry. The purchase price totaled $13,783,000 and
consisted of $6,100,000 in cash; a note to the selling shareholder for
$7,000,000; 63,492 shares of common stock valued at $500,000 and acquisition
costs of $183,000. The results of operations of AG have been included in the
consolidated statement of income from its acquisition date.
The following table presents the unaudited pro forma consolidated results
of operations of the Company and AG for the nine months ended March 31, 1999.
The pro forma results are not necessarily indicative of the actual results of
operations that might have occurred, nor are they necessarily indicative of
results in the future.
Nine Months Ended
March 31, 1999
---------------
Sales $23,060,000
Net income $ 5,459,000
Earnings per share
Basic $ 1.02
Diluted $ 1.01
6
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
-------------------------------------------
(CONTINUED)
-----------
Note 3 - Debt
- -------------
Credit Facility
The Company has a $2,500,000 unsecured credit facility which expires in
January 2003. Maximum borrowings under the facility decrease $500,000 each
January and bear interest at the prime rate. The credit facility contains
covenants which include: (i) prohibition of additional indebtedness; (ii)
minimum tangible net worth of $4,998,000 at June 30, 1999 which increases by 75%
of net income each year and; (iii) a ratio of total liabilities to tangible net
worth of not more than 2 to 1 through December 31, 2000. This ratio decreases to
1.25 to 1 after December 31, 2000. The Company also must maintain minimum debt
service of not less than 2 to 1 and cannot have two consecutive quarterly
losses. The Company is in compliance with these covenants at March 31, 2000.
8.25% Non-Negotiable Promissory Note
In connection with the acquisition of AG, the Company issued a $7,000,000
note to the selling shareholder for a portion of the purchase price. The note
has a final maturity of April 2002 and requires minimum principal payments of
$425,000 per quarter. The Company has pledged the assets and common stock of AG
as collateral for the note. Also under the terms of the note the Company must
have AG maintain a current ratio of no less than 3 to 1 and maintain minimum
tangible net worth of $4,000,000.
The Company is in compliance with these covenants at March 31, 2000.
Note 4 - Income Taxes
- ---------------------
At March 31, 2000, the Company had net operating loss carry-forwards of
approximately $3,784,000 which expire in years 2002 through 2007. Financial
Accounting Standards No. 109 (FAS 109), "Accounting for Income Taxes", requires
that the tax benefit of net operating loss ("nol") carry-forwards be recorded as
an asset to the extent that management assesses the utilization of such nol
carry-forwards to be "more likely than not". Based primarily upon the Company's
recent earnings history and expected future levels of taxable income, management
believes that it is more likely than not that it will realize the benefit of its
net deferred tax asset. The amount of the net deferred tax asset recorded could
be adjusted if estimates of future taxable income during the carry-forward
period are revised.
7
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
-------------------------------------------
(CONTINUED)
-----------
Note 4 - Income Taxes (cont'd)
- ------------------------------
Components of income tax (benefit) expense for the nine months ended March
31, 2000 and 1999 follow:
March 31, March 31,
2000 1999
---- ----
Current:
State.............. $ 82,000 $273,000
-------- --------
Deferred:
Federal............ 360,000 293,000
-------- --------
Income tax expense...... $442,000 $566,000
======== ========
Note 5 - Inventories
- --------------------
Inventories, net of reserves, are comprised of the following:
March 31, June 30,
2000 1999
---- ----
Raw materials and sub-assemblies.. $4,163,000 $4,947,000
Work-in process................... 687,000 466,000
---------- ----------
$4,850,000 $5,413,000
========== ==========
Note 6 - Property and Equipment
- --------------------------------
Property and equipment are comprised of the following:
March 31, June 30,
2000 1999
---- ----
Building and leasehold improvements.. $ 540,000 $ 534,000
Geophysical equipment................ 460,000 460,000
Machinery and equipment.............. 5,666,000 5,573,000
Equipment held for rental............ 480,000 480,000
----------- -----------
7,146,000 7,047,000
Less accumulated depreciation.... (5,824,000) (5,614,000)
----------- -----------
$ 1,322,000 $ 1,433,000
=========== ===========
8
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
-------------------------------------------
(CONTINUED)
-----------
Note 7 - Earnings Per Share
- ---------------------------
Basic earnings per share is computed by dividing net income by the average
number of common shares outstanding during the year. Diluted earnings per share
is computed by dividing net income by the average number of common shares
outstanding assuming dilution, the calculation of which assumes that all stock
options are exercised at the beginning of the period and the proceeds used to
purchase shares at the average market price for the period. The following is a
reconciliation from basic earnings per share to diluted earnings per share for
the three month and nine month periods ended March 31, 2000 and 1999.
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net earnings available to common
stockholders $ 138,000 $ 708,000 $ 483,000 $4,024,000
========== ========== ========== ==========
Weighted average number of common
shares outstanding 5,391,378 5,306,886 5,383,378 5,267,415
Common stock equivalents - stock options 13,927 59,007 25,777 95,664
---------- ---------- ---------- ----------
Weighted average number of common shares and
common share equivalents outstanding 5,405,305 5,365,893 5,409,155 5,363,079
========== ========== ========== ==========
Basic earnings per share $ 0.03 $ 0.13 $ 0.09 $ 0.76
Diluted earnings per share $ 0.03 $ 0.13 $ 0.09 $ 0.75
</TABLE>
9
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
-------------------------------------------
(CONTINUED)
-----------
Note 8 - Segment Information
- ----------------------------
The Company's reportable segments are: (1) geophysical equipment and (2)
industrial clutches. The following table provides selected financial information
for both of the Company's segments for the nine months ended March 31, 2000 and
1999.
Nine months ended March 31, 2000
- --------------------------------
Geophysical Industrial
Equipment Clutches Total
----------- ---------- -----
Sales $ 8,685,000 $2,590,000 $11,275,000
Interest income 70,000 - 70,000
Interest expense 397,000 - 397,000
Depreciation and amortization 514,000 193,000 707,000
Income before income taxes 324,000 601,000 925,000
Segment assets 19,533,000 6,179,000 25,712,000
Fixed asset additions 61,000 37,000 98,000
Nine months ended March 31, 1999
- ---------------------------------
Geophysical Industrial
Equipment Clutches Total
--------- -------- -----
Sales $13,701,000 $2,126,000 $15,827,000
Interest income 109,000 - 109,000
Depreciation and amortization 28,000 186,000 214,000
Income before income taxes 4,187,000 403,000 4,590,000
Segment assets 13,388,000 6,274,000 19,662,000
Fixed asset additions 60,000 15,000 75,000
The Company does not allocate income taxes to its segments.
10
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
---------------------------------------
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
Cautionary Statement for Purposes of Forward-Looking Statements
- ---------------------------------------------------------------
Certain statements contained herein and elsewhere may be deemed to be
forward-looking within the meaning of The Private Securities Litigation Reform
Act of 1995 and are subject to the "safe harbor" provisions of that act,
including without limitation, statements concerning future sales, earnings,
costs, expenses, asset recoveries, working capital, capital expenditures,
financial condition, and other results of operations. Such statements involve
risks and uncertainties. Actual results could differ materially from the
expectations expressed in such forward-looking statements.
Demand for the Company's geophysical equipment is dependent upon the level
of world-wide oil and gas exploration activity. This activity depends primarily
on oil and gas prices. Historically these markets have been volatile. Factors
that cause this volatility are consumer demand, weather, world political
conditions and overall economic conditions. Volatility in oil and gas prices has
resulted in a reduction in exploration activity which has decreased the demand
for geophysical equipment manufactured by the Company.
Liquidity and Capital Resources
- -------------------------------
For the nine months ended March 31, 2000 cash and cash equivalents
decreased $1,211,000 compared to an increase of $5,009,000 for the nine months
ended March 31, 1999. The primary causes for the decrease in cash and cash
equivalents for the current nine month period were the reduced level of sales
and net income, the repayment of $1,275,000 of long-term debt related to the
acquisition of A-G Geophysical and the reduction in current liabilities of
$1,456,000 from the June 30, 1999 level.
For the nine months ended March 31, 2000 the Company spent $98,000 for
capital expenditures. The Company does not anticipate capital expenditures for
the current fiscal year to exceed $150,000.
The Company has a $2,500,000 unsecured credit facility which matures in
2003. Available borrowings under the terms of the agreement decrease by $500,000
each year. Any borrowings under the agreement bear interest at the prime rate.
There are no borrowings outstanding under this agreement at March 31, 2000.
As part of the consideration for the acquisition of A-G Geophysical in
April 1999, the Company issued a $7,000,000 note. The note bears interest at
8.25% payable monthly and requires quarterly principal payments of $425,000. The
note has a final maturity in April 2002. The Company pledged the assets and
common stock of AG as collateral for the note.
Under the terms of the January 1998 asset purchase agreement for Custom
Products, the Company may be required to make maximum additional payments to the
former owners of Custom Products of $4,000,000 if net sales of Custom Products
increase to certain levels by December 2002. A payment was not required for the
twelve months ended December 31, 1999 or December 31, 1998 because the sales of
Custom Products did not meet the amount specified in the asset purchase
agreement.
11
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
---------------------------------------
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
(CONTINUED)
-----------
Liquidity and Capital Resources (cont'd)
- ----------------------------------------
The Company is owner of a one-half interest in its administrative and
engineering building located in Norwalk, Connecticut through a joint venture
agreement. The agreement expired in July 1999. Under the terms of the agreement,
the Company can purchase the one-half interest owned by its joint venture
partner, estimated at approximately $300,000. The Company is currently exploring
various alternatives with its joint venture partner. If the Company does
purchase the building, it will use existing cash on hand.
In October 1998, the Company announced that its board of directors approved
a stock repurchase program under which the Company was authorized to buy up to
500,000 shares of its common stock in open market or private transactions. The
Company will use its cash flow from operations and existing cash balances for
the repurchase of any shares. The Company has not repurchased any shares under
the program.
Current cash and cash equivalent balances, existing borrowing capacity and
projected cash flow from operations are currently considered adequate to meet
foreseeable operating needs.
The Company believes that inflation and changing prices have not had a
material effect on the Company's revenues and profitability.
Results of Operations
- ---------------------
Nine Months Ended March 31, 2000 Compared to Nine Months Ended March 31, 1999
- -----------------------------------------------------------------------------
The consolidated statement of income for the nine months ended March 31,
2000 include the results of operations of A-G Geophysical which was acquired in
April 1999.
Sales for the nine months ended March 31, 2000 decreased $4,552,000 or 29 %
from the corresponding period last year. Sales of marine air guns and
replacement parts decreased $8,512,000. Partially offsetting this decline were
the sales of $3,496,000 from AG and an increase in sales of industrial clutches
of $464,000. Although recent oil pricies are the highest in nine years, the
significant decrease in sales of marine air guns and replacement parts has been
caused by reduced exploration spending by oil companies and excess marine
seismic industry capacity.
12
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
-------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS
-----------------------------------
(CONTINUED)
-----------
Results of Operations (cont'd)
- ------------------------------
Cost of sales as a percentage of sales was 53% for the nine months ended
March 31, 2000 and 51% for the nine months ended March 31, 1999. The effect of
lower operating efficiencies from the decreased demand for marine air guns and
replacement parts increased the cost of sales by 6 percentage points and the
higher demand for industrial clutches decreased cost of sales by 4 percentage
points.
Research and development costs remained essentially unchanged from the
corresponding period of the prior year. The Company is in the final development
and testing stage of its new marine air gun.
Selling, general and administrative expense increased $530,000 over the
prior year's nine month period. The inclusion of A-G Geophysical added $957,000
to expense and marketing costs at Custom Products increased $138,000. Offsetting
the added expenses from AG and Custom Products was a $499,000 decrease in
incentive compensation expense because of the reduction in earnings.
Amortization of intangibles increased $324,000 because of the acquisition
of AG in April 1999. The Company is amortizing the goodwill relating to
acquisitions over twenty years.
Interest expense amounted to $397,000 for the nine months and represents
amounts paid in connection with the AG acquisition. Interest income decreased
$39,000 for the same period due to the lower balance of short-term investments.
The provision for income taxes for the nine month period was $442,000, an
effective tax rate of 48%. This amount is higher than the statutory federal rate
of 34% principally because of the effect of the amortization of the goodwill
from the AG acquisition which is not deductible for tax purposes and the effect
of state income taxes. The provision for income taxes for the first nine months
of fiscal 1999 was $566,000, an effective tax rate of 12%, because of the
utilization of previously reserved net operating loss carry-forwards.
Three Months Ended March 31, 2000 Compared to Three Months Ended March 31, 1999
- --------------------------------------------------------------------------------
The consolidated statement of income for the three months ended March 31,
2000 includes the results of operations of A-G Geophysical which was acquired in
April 1999.
Sales for the quarter ended March 31, 2000 compared to the quarter ended
March 31, 1999 decreased $634,000 or 14%. Sales of marine air guns and
replacement parts decreased by $2,026,000 because of the same factors that
caused the decrease for the nine month period. The inclusion of AG for the
quarter increased sales by $1,172,000 and sales of industrial clutches increased
$220,000.
Cost of sales as a percentage of sales increased from 53% to 56% for the
quarter. The effect of lower operating efficiencies associated with the
decreased demand for geophysical equipment increased the cost of sales
percentage by 9 percentage points and The improved operating margins at Custom
Products favorably effected the cost of sales percentage by 6 percentage points.
13
<PAGE>
BOLT TECHNOLOGY CORPORATION
---------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
-------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS
-----------------------------------
(CONTINUED)
-----------
Results of Operations (cont'd)
- ------------------------------
Research and development costs decreased $36,000 for the quarter as the
Company completed most of its development efforts related to its new marine air
gun.
Selling, general and administrative expense increased $240,000 for the
quarter. The inclusion of AG accounted for $329,000 of the increase. Marketing
costs related to the higher sales level at Custom Products accounted for $73,000
of the increase. Reduced incentive compensation expenses of $108,000 offset part
of the selling, general and administrative expense increase.
Amortization of intangibles increased $107,000 because of the acquisition
of AG in April 1999.
Interest expense amounted to $123,000 for the quarter and represents
amounts paid in connection with the AG acquisition. Interest income decreased by
$29,000 for the quarter because the Company used its short-term investments to
finance a portion of the AG acquisition in April 1999.
The provision for income taxes for the third quarter of fiscal 2000 was
$140,000, an effective tax rate of 50%. This provision is more than the
statutory rate for the same reasons that effected the tax provision for the nine
month period. The provision for income taxes for the third quarter of fiscal
1999 was $419,000, an 37% effective rate. The tax rate in last year's third
quarter did not include the effect of the goodwill amortization from the AG
acquisition which caused the increase in the fiscal 2000 tax rate.
Item 3 - Quantitative and Qualitative Disclosures About Market Risk
- -------------------------------------------------------------------
None
PART II- OTHER INFORMATION
--------------------------
Item 6 - Exhibits and Reports on Form 8-K
- -----------------------------------------
(a) Exhibits.
----------
(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 2000.
14
<PAGE>
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
-----------------------
Chairman, President and Chief Executive Officer
(Principal Financial Officer)
/s/ Alan Levy
-----------------------
Vice President-Finance
Secretary and Treasurer
(Principal Accounting Officer)
April 26, 2000
15
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FINANCIAL
STATEMENTS FOR THE PERIOD ENDED MARCH 31, 2000 AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-2000
<PERIOD-START> JUL-01-1999
<PERIOD-END> MAR-31-2000
<CASH> 2,289,000
<SECURITIES> 0
<RECEIVABLES> 2,710,000
<ALLOWANCES> 0
<INVENTORY> 4,850,000
<CURRENT-ASSETS> 11,059,000
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 25,712,000
<CURRENT-LIABILITIES> 3,316,000
<BONDS> 0
0
0
<COMMON> 26,140,000
<OTHER-SE> (7,769,000)
<TOTAL-LIABILITY-AND-EQUITY> 25,712,000
<SALES> 11,275,000
<TOTAL-REVENUES> 11,275,000
<CGS> 5,964,000
<TOTAL-COSTS> 5,964,000
<OTHER-EXPENSES> 4,059,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 397,000
<INCOME-PRETAX> 925,000
<INCOME-TAX> 442,000
<INCOME-CONTINUING> 483,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 483,000
<EPS-BASIC> .09
<EPS-DILUTED> .09
</TABLE>
