<PAGE 1>
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE) QUARTERLY REPORT / X / OR TRANSITION REPORT / /
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended
October 31, 1997 Commission File No. 1-5865
GERBER SCIENTIFIC, INC.
-------------------------------------------------------
(Exact name of Registrant as specified in its charter)
CONNECTICUT 06-0640743
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
83 Gerber Road West, South Windsor, Connecticut 06074
-------------------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including area code (860) 644-1551
--------------
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 / X / . No / / .
At October 31, 1997, 22,563,775 shares of common stock of the Registrant
were outstanding.
<PAGE 2>
GERBER SCIENTIFIC, INC.
AND SUBSIDIARIES
CONTENTS OF QUARTERLY REPORT ON FORM 10-Q
Quarter ended October 31, 1997
PAGE
----
Part I - Financial Information
Item 1. Consolidated Financial Statements:
Statement of Earnings for the three months
ended October 31, 1997 and 1996 2
Statement of Earnings for the six months
ended October 31, 1997 and 1996 3
Balance Sheet at October 31, 1997 and
April 30, 1997 4
Statement of Cash Flows for the six months
ended October 31, 1997 and 1996 5
Notes to Financial Statements 6
Independent Accountants' Report 8
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
Part II - Other Information
Item 1. Legal Proceedings 13
Item 4. Submission of Matters to a Vote
of Security Holders 13
Item 5. Other Information 13
Item 6. Exhibits and Reports on Form 8-K 14
Signature 15
Exhibit Index 16
-1-
<PAGE 3>
GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF EARNINGS
------------------------------------------------------------------------
In Thousands
(except per share amounts)
------------------------------------------------------------------------
Three Months Ended October 31, 1997 1996
------------------------------------------------------------------------
Revenue:
Product sales $ 94,734 $ 83,348
Service 11,658 11,603
--------- ---------
106,392 94,951
--------- ---------
Costs and Expenses:
Cost of product sales 51,792 45,017
Cost of service 7,563 7,405
Selling, general and administrative 31,764 30,380
Research and development expenses 7,765 7,433
--------- ---------
98,884 90,235
--------- ---------
Operating income 7,508 4,716
Other income 670 2,302
Interest expense (82) (83)
--------- ---------
Earnings before income taxes 8,096 6,935
Provision for income taxes 2,600 1,800
--------- ---------
Net earnings $ 5,496 $ 5,135
========= =========
Net earnings per common share $ .24 $ .22
========= =========
Dividends paid per common share $ .08 $ .08
========= =========
Average common shares outstanding 23,325 23,327
========= =========
See Accompanying Notes
-2-
<PAGE 4>
GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF EARNINGS
------------------------------------------------------------------------
In Thousands
(except per share amounts)
------------------------------------------------------------------------
Six Months Ended October 31, 1997 1996
------------------------------------------------------------------------
Revenue:
Product sales $ 182,144 $ 157,878
Service 23,209 22,881
--------- ---------
205,353 180,759
--------- ---------
Costs and Expenses:
Cost of product sales 99,880 87,202
Cost of service 15,380 14,362
Selling, general and administrative 62,707 58,975
Research and development expenses 15,353 14,209
--------- ---------
193,320 174,748
--------- ---------
Operating income 12,033 6,011
Other income 3,010 3,300
Interest expense (176) (173)
--------- ---------
Earnings before income taxes 14,867 9,138
Provision for income taxes 4,800 2,400
--------- ---------
Net earnings $ 10,067 $ 6,738
========= =========
Net earnings per common share $ .43 $ .29
========= =========
Dividends paid per common share $ .16 $ .16
========= =========
Average common shares outstanding 23,518 23,350
========= =========
See Accompanying Notes
-3-
<PAGE 5>
GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
In Thousands
-------------------------------------------------------------------------
October 31, April 30,
1997 1997
-------------------------------------------------------------------------
ASSETS
Current Assets:
Cash and short-term cash investments $ 15,319 $ 9,503
Accounts receivable 94,562 92,378
Inventories 68,097 62,221
Prepaid expenses 12,409 13,702
---------- ----------
190,387 177,804
---------- ----------
Investments and long-term
receivables 27,048 37,037
---------- ----------
Property, plant and equipment 126,497 121,447
Less accumulated depreciation 59,842 58,883
---------- ----------
66,655 62,564
---------- ----------
Intangible assets 57,728 56,687
Less accumulated amortization 11,622 10,774
---------- ----------
46,106 45,913
---------- ----------
Other assets 805 1,897
---------- ----------
$ 331,001 $ 325,215
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Notes payable $ -- $ --
Current maturities of long-term debt 193 193
Accounts payable 27,759 17,453
Accrued compensation and benefits 14,519 14,038
Deferred revenue 6,150 6,249
Other accrued liabilities 19,876 18,458
Advances on sales contracts 6,659 2,465
---------- ----------
75,156 58,856
---------- ----------
Noncurrent Liabilities:
Deferred income taxes 11,263 11,193
Long-term debt 7,050 7,145
---------- ----------
18,313 18,338
---------- ----------<PAGE>
Contingencies and Commitments
Shareholders' Equity:
Preferred stock, no par value; authorized
10,000,000 shares; no shares issued -- --
Common stock, $1.00 par value; authorized
65,000,000 shares; issued
23,363,775 and 23,306,900 shares 23,364 23,307
Paid-in capital 36,681 36,100
Retained earnings 194,277 187,880
Cumulative translation component (390) 734
Treasury stock, at cost (800,000 shares) (16,400) --
---------- ----------
237,532 248,021
---------- ----------
$ 331,001 $ 325,215
========== ==========
See Accompanying Notes
-4-
<PAGE 6>
GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
In Thousands
-------------------------------------------------------------------------
Six Months Ended October 31, 1997 1996
-------------------------------------------------------------------------
CASH PROVIDED BY (USED FOR):
Operating Activities
Net earnings $ 10,067 $ 6,738
Adjustments to reconcile net earnings to
cash provided by operating activities:
Depreciation and amortization 6,604 5,894
Deferred income taxes 70 1,163
Changes in operating accounts:
Receivables (2,073) (10,933)
Inventories (5,876) (285)
Prepaid expenses 1,293 (1,351)
Accounts payable and accrued expenses 16,300 (642)
-------- --------
Provided by Operating Activities 26,385 584
-------- --------
Financing Activities
Purchase of common stock (16,400) --
Repayments of long-term debt (95) (96)
Exercise of stock options 638 275
Dividends on common stock (3,670) (3,713)
-------- --------
(Used for) Financing Activities (19,527) (3,534)
-------- --------
Investing Activities
Long-term debt securities 9,878 7,268
Additions to property, plant and equipment (9,715) (6,440)
Intangible and other assets (81) (373)
Other long-term investments (1,124) 1,073
-------- --------
Provided by (Used for) Investing Activities (1,042) 1,528
-------- --------
Increase (Decrease) in Cash and Short-Term
Cash Investments 5,816 (1,422)
Cash and Short-Term Cash Investments,
Beginning of Period 9,503 8,704
-------- --------
Cash and Short-Term Cash Investments,
End of Period $ 15,319 $ 7,282
======== ========
See Accompanying Notes
-5-
<PAGE 7>
GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1
The consolidated balance sheet at October 31, 1997, the
consolidated statements of earnings for the three- and six-month
periods ended October 31, 1997 and 1996, and the consolidated
statement of cash flows for the six-month periods ended October 31,
1997 and 1996 are unaudited but, in the opinion of the Company,
include all adjustments, consisting only of normal recurring
accruals, necessary for a fair statement of the results for the
interim periods. The results of operations for the six-month
period ended October 31, 1997 are not necessarily indicative of the
results to be expected for the full fiscal year.
NOTE 2
The classification of inventories was as follows (in thousands):
October 31, 1997 April 30, 1997
---------------- --------------
Raw materials and
purchased parts $ 56,368 $ 49,461
Work in process 11,729 12,760
-------- --------
$ 68,097 $ 62,221
======== ========
NOTE 3
Net earnings per common share were calculated on the basis of the
weighted average number of shares of common stock and common stock
equivalents outstanding during each period.
NOTE 4
Included in other income for the six month period ended
October 31, 1997 was a gain resulting from the final settlement of
the Company's UK patent litigation with Lectra Systemes, S.A. of
France, which added $1,563,000 to earnings before income taxes and
approximately $1,000,000, or $.04 per share, to net income.
Included in other income for the three and six month periods ended
October 31, 1996 was a gain resulting from life insurance benefits
the Company received upon the death of Mr. H. Joseph Gerber which
added approximately $1,000,000, or $.04 per share, to net income.
NOTE 5
In the second quarter ended October 31, 1997, the Company purchased
800,000 shares of its common stock from the estate of H. Joseph
Gerber for a total of $16,400,000, or $20.50 per share. The
reacquired shares are held by the Company as treasury stock.
-6-
<PAGE 8>
GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
With respect to the unaudited consolidated financial statements of
Gerber Scientific, Inc. at October 31, 1997 and for the three- and
six-month periods ended October 31, 1997 and 1996, KPMG Peat
Marwick LLP has made a review (based on procedures adopted by the
American Institute of Certified Public Accountants) and not an
audit, as set forth in their separate report dated November 19,
1997 appearing on page 8. That report does not express an opinion
on the interim unaudited consolidated financial information. KPMG
Peat Marwick LLP has not carried out any significant or additional
audit tests beyond those which would have been necessary if their
report had not been included. Accordingly, such report is not a
"report" or "part of the Registration Statement" within the meaning
of Sections 7 and 11 of the Securities Act of 1933 and the
liability provisions of Section 11 of such Act do not apply.
-7-
<PAGE 9>
INDEPENDENT ACCOUNTANTS' REPORT
To the Board of Directors and Shareholders of
Gerber Scientific, Inc.
We have made a review of the consolidated statements of earnings
of Gerber Scientific, Inc. and subsidiaries for the three- and
six-month periods ended October 31, 1997 and 1996, the
consolidated statement of cash flows for the six-month periods
ended October 31, 1997 and 1996, and the consolidated balance
sheet as of October 31, 1997 in accordance with standards
established by the American Institute of Certified Public
Accountants. We have previously audited, in accordance with
generally accepted auditing standards, and expressed our
unqualified opinion dated May 22, 1997 on the consolidated
financial statements for the year ended April 30, 1997 (not
presented herein). The aforementioned financial statements are
the responsibility of the Company's management.
A review of interim financial information consists principally of
applying analytical review procedures to financial data and
making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an
examination in accordance with generally accepted auditing
standards, the objective of which is the expression of an opinion
regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material
modifications that should be made to the accompanying
consolidated statements of earnings for the three- and six-month
periods ended October 31, 1997 and 1996, the consolidated
statement of cash flows for the six-month periods ended October
31, 1997 and 1996, or the consolidated balance sheet as of
October 31, 1997 for them to be in conformity with generally
accepted accounting principles. Also, in our opinion the
information in the accompanying consolidated balance sheet as of
April 30, 1997 is fairly presented, in all material respects, in
relation to the consolidated balance sheet from which it has been
derived.
/s/ KPMG PEAT MARWICK LLP
Hartford, Connecticut
November 19, 1997
-8-
<PAGE 10>
GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FINANCIAL CONDITION
The Company's ratio of current assets to current liabilities was
2.5 to 1 at October 31, 1997 compared with 3 to 1 at April 30,
1997. Net working capital at October 31, 1997 was $115.2
million, a decrease of $3.7 million from the beginning of the
current fiscal year. The Company's cash and short-term
investments totalled $15.3 million at October 31, 1997 compared
with $9.5 million at the end of the prior fiscal year. In
addition, the Company's investment portfolio of longer-term debt
securities, primarily tax-exempt municipal bonds, totalled $26.7
million at October 31, 1997 compared with $36.6 million at April
30, 1997.
Operating activities provided $26.4 million in cash for the six-
month period ended October 31, 1997 compared with $.6 million
provided by operating activities for the same period last year.
Cash generated by earnings and the non-cash charges for
depreciation and amortization was somewhat offset by growth in
inventories in this year's first six months. However, increases
in accounts payable related primarily to improved management of
vendor payment cycles produced additional cash from operations.
The principal non-operating uses of cash in the six months ended
October 31, 1997 were the purchase of treasury stock of $16.4
million, additions to property, plant, and equipment of $9.7
million, and payment of dividends of $3.7 million. During the
second quarter, the Company purchased 800,000 shares of its
common stock from the estate of H. Joseph Gerber for a total of
$16.4 million. The Company anticipates that capital expenditures
for the current fiscal year will be in the range of $13 million
and expects to fund these with cash on hand and cash from
operations.
The Company's total debt at October 31, 1997 was $7.2 million,
down slightly from April 30, 1997. The ratio of total debt to
shareholders' equity was 3 percent at October 31, 1997, compared
with 3 percent at April 30, 1997. The Company believes its low
ratio of debt-to-equity is an important indicator of its ability
to borrow funds should needs arise.
-9-
<PAGE 11>
RESULTS OF OPERATIONS
Combined sales and service revenue for the three- and six-month
periods ended October 31, 1997 increased $11.4 million (12
percent) and $24.6 million (14 percent), respectively, from the
same periods last year. The increases reflected higher product
sales and slightly higher service revenue. Product sales
increased in all of the Company's major product classes, except
for computer-to-plate imaging systems for the printing industry
which were comparable to prior year levels. The most significant
increase in sales was of the Company's GERBERcutter fabric
cutting systems. In addition, GGT Cutting Edge, an acquisition
in last year's fourth quarter, contributed $3.6 million and $7.0
million of the second quarter and year-to-date sales increases.
The consolidated gross profit margin in this year's first six
months was 43.9 percent, which was roughly the same as the prior
year margin of 43.8 percent. The consolidated gross profit
margin in this year's second quarter of 44.2 percent was slightly
lower than the prior year margin of 44.8 percent. Gross profit
margins on product sales were 45.3 percent and 45.2 percent in
this year's second quarter and first six months compared with 46
percent and 44.8 percent in the prior year comparable periods.
The lower second quarter margins this year were caused primarily
by higher sales of OEM-supplied equipment for the electronics
industry and also by price discounting on computer-to-plate
imaging systems for the commercial printing market. This
decrease was offset on a year-to-date basis by favorable volume
effects from higher shipments of GERBERcutter fabric cutting
systems.
Service gross profit margins were 35.1 percent and 33.7 percent
in this year's second quarter and first six months compared with
36.2 percent and 37.2 percent in the prior year comparable
periods. The year-to-year decreases were caused primarily by
costs in the current year associated with development of an
applications training revenue stream from the computer-to-plate
systems businesses.
Selling, general, and administrative expenses in this year's
second quarter and first six months rose by $1.4 million and $3.7
million from last year but declined as a percentage of revenue to
29.9 percent and 30.5 percent this year from 32 percent and 32.6
percent last year. The increased expenses were caused primarily
by higher marketing expenses associated with major trade shows
and also by the inclusion of the expenses of GGT Cutting Edge.
Partially offsetting these increases was the effect of a cost
reduction program implemented at the Company's Gerber Garment
Technology (GGT) subsidiary.
-10-
<PAGE 12>
The Company continued to commit significant resources to research
and the development of new products. R&D expense of $7.8 million
in this year's second quarter and $15.4 million in the first six
months represented 7.3 percent and 7.5 percent of revenue in
these periods, respectively. Although R&D expense increased $.3
million and $1.1 million from the comparable prior year periods,
the percentage of R&D expenses to sales revenue is lower in this
year's three- and six-month periods. The dollar increase was
related primarily to the development of new signmaking plotters
and the inclusion of the expenses of GGT Cutting Edge.
Management anticipates that this lower ratio of R&D to revenue
will continue in the current year due in part to comparatively
lower levels of development spending in computer-to-plate imaging
systems for the printing industry and to growth in sales volume.
Other income in this year's second quarter and first six months
ended October 31, 1997 was lower than last year. The quarterly
decrease relates to the prior year gain of approximately $1.0
million ($.04 per share) from life insurance benefits received
upon the death of Mr. H. Joseph Gerber, the Company's former
Chairman and President. Partially offsetting this item on a
year-to-date basis was a gain in the current year's first quarter
from the final settlement of the Company's UK patent litigation
with Lectra Systemes S.A. of France, amounting to $1.6 million
($.04 per share). Also affecting the year-to-year comparison was
lower interest income this year resulting from a smaller
investment portfolio of tax-exempt municipal bonds.
The provision rate for income taxes was 32.1 percent for the
second quarter and 32.3 percent for the six months ended October
31, 1997 compared with 26 percent and 26.3 percent in the prior
year comparable periods. The lower tax rate last year was the
result of the tax-exempt life insurance benefits noted above.
The year-to-year increases in the provision rates also reflected
the higher marginal combined Federal and state income tax rates
associated with the higher levels of pre-tax earnings in the
current year. The effective income tax rate in each period
continued to be lower than the 35 percent statutory U.S. Federal
tax rate primarily because of tax-exempt interest income and the
tax benefits of the Company's Foreign Sales Corporation.
As a result of the above, net earnings increased in this year's
second quarter to $5.5 million or $.24 per share from $5.1
million or $.22 per share in last year's second quarter. For the
first six months, net earnings this year increased to $10.1
million or $.43 per share this year compared with $6.7 million or
$.29 per share last year.
-11-
<PAGE 13>
FORWARD LOOKING STATEMENTS
This report includes forward-looking statements that describe the
Company's business prospects. Readers should keep in mind
factors that could have an adverse impact on those prospects.
These include political, economic, or other conditions, such as
recessionary or expansive trends, inflation rates, currency
exchange rates, taxes and regulations and laws affecting the
business, as well as product competition, pricing, the degree of
acceptance of new products to the marketplace, and the difficulty
of forecasting sales at various times in various markets.
-12-
<PAGE 14>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Form 10-Q for the quarter ended July 31, 1997 reported the final
settlement of the Company's UK patent litigation with Lectra
Systemes, S.A. of France.
Item 4. Submission of Matters to a Vote of Security Holders
On September 12, 1997, the Company held its annual meeting of
shareholders. The holders of 93.5% of the shares of common stock
entitled to vote at this meeting were present either in person or
by proxy. The following were the voting results for the meeting:
- the shareholders approved the Amendment to the Restated
Certificate of Incorporation and By-Laws with 21,346,250
votes in favor, 405,162 votes against, and 76,539
abstentions.
- the shareholders approved the Amended/Restated 1992
Employee Stock Plan with 19,418,329 votes in favor,
2,296,673 votes against, and 112,949 abstentions.
- the shareholders approved the Amended/Restated 1992 Non-
Employee Director Option Plan with 20,759,643 votes in
favor, 967,412 votes against, and 100,896 abstentions.
- the shareholders elected Directors to hold office until
the annual meeting to be held in the year 2000 with
the following votes:
For Withheld
Edward E. Hood, Jr. 21,652,909 175,042
W. Jerome Vereen 21,650,733 177,218
Michael J. Cheshire 21,650,268 177,683
The terms of office of the other Directors, George M.
Gentile, David J. Gerber, A. Robert Towbin, and David J.
Logan continued after the meeting.
Item 5. Other Information
On August 6, 1997, the Company issued a press release reporting
the retirement of Ronald B. Webster, a Senior Vice President of
the Company and President of its wholly owned subsidiary, Gerber
Scientific Products (GSP), as of May 1, 1998. Charles M. Hevenor,
a 28-year employee of the Company and most recently Senior Vice
President, Software and Systems of GSP was appointed Executive
Vice President and General Manager of GSP and will become
President of GSP upon Mr. Webster's retirement next May.
On August 14, 1997, the Company issued a press release reporting
the purchase of 800,000 shares of its common stock from the
estate of H. Joseph Gerber for a total of $16,400,000, or $20.50
per share. The reacquired shares, which represented
approximately 3.4% of the Company's outstanding stock, are held
by the Company as treasury stock.
-13-
<PAGE 15>
On August 29, 1997, the Company issued a press release reporting
that its wholly-owned subsidiary, Gerber Optical, Inc., had
expanded its strategic alliance with Essilor International by
purchasing certain assets of Essilor Technologies of America and
acquiring exclusive retail distribution rights to the Essilor
Alpha and Gamma finishing systems within the United States.
On September 29, 1997, the Company issued a press release
announcing the appointment of two new Directors to the Company's
Board of Directors, Donald P. Aiken, President of ABB Industrial
Systems Inc. and Carole F. St. Mark, President of Growth
Management LLC and former President and CEO of Pitney Bowes
Business Services.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(11)Statement regarding computation of per share earnings.
(15)Letter regarding unaudited interim financial information.
(27)Financial data schedule.
(b)Reports on Form 8-K
No Form 8-K was filed during the quarter for which this report is
filed.
-14-
<PAGE 16>
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.
GERBER SCIENTIFIC, INC.
-----------------------
(Registrant)
Date: November 20, 1997 By:/s/ Gary K. Bennett
------------------- ------------------------------
Senior Vice President, Finance
and Principal Accounting
Officer
-15-
<PAGE 17>
EXHIBIT INDEX
-------------
Exhibit Index
Number Exhibit Page
------------- ------- ----
11 Statement Regarding Computation
of Per Share Earnings.*
15 Letter Regarding Unaudited Interim
Financial Information.*
27 Financial Data Schedule.*
*Filed herewith.
-16-
<PAGE 18>
EXHIBIT NO. 11
<TABLE>
GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
COMPUTATION OF PER SHARE EARNINGS
<CAPTION>
Three Months Six Months
Ended Ended
October 31 October 31
--------------------------- ---------------------------
1997 1996 1997 1996
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Net earnings $ 5,496,000 $ 5,135,000 $ 10,067,000 $ 6,738,000
============ ============ ============ ============
Weighted average shares of
common stock outstanding
during the period 22,679,135 23,231,530 23,001,000 23,220,984
Common stock equivalents:
Common stock attributable
to stock options (treasury
stock method) 645,571 95,580 516,597 129,042
------------ ------------ ------------ ------------
Average common shares
outstanding 23,324,706 23,327,110 23,517,597 23,350,026
============ ============ ============ ============
Net earnings per common share $ .24 $ .22 $ .43 $ .29
============ ============ ============ ============
Note: Net earnings per common share as calculated above is presented on a
primary and fully diluted basis.
</TABLE>
EXHIBIT NO. 15
To the Board of Directors and Shareholders of
Gerber Scientific, Inc.
Re: Registration Statements on Form S-8,
File No. 2-93695 and No. 33-58668
Registration Statement on Form S-3,
File No. 33-58670
With respect to the subject Registration Statements, we
acknowledge our awareness of the use therein of our report dated
November 19, 1997 related to our review of interim financial
information.
Pursuant to Rule 436(c) under the Securities Act, such reports
are not considered a part of a Registration Statement prepared or
certified by an accountant or a report prepared or certified by
an accountant within the meaning of Sections 7 and 11 of the Act.
Very truly yours,
/s/ KPMG PEAT MARWICK LLP
Hartford, Connecticut
November 19, 1997
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Consolidated Balance Sheet and Statement of Earnings of Gerber Scientific, Inc.
as of and for the six-month period ended October 31, 1997 and is qualified in
its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> APR-30-1998
<PERIOD-END> OCT-31-1997
<CASH> 15,319
<SECURITIES> 0
<RECEIVABLES> 94,652
<ALLOWANCES> 0
<INVENTORY> 68,097
<CURRENT-ASSETS> 190,387
<PP&E> 126,497
<DEPRECIATION> 59,842
<TOTAL-ASSETS> 331,001
<CURRENT-LIABILITIES> 75,156
<BONDS> 7,050
0
0
<COMMON> 23,364
<OTHER-SE> 214,168
<TOTAL-LIABILITY-AND-EQUITY> 331,001
<SALES> 205,353
<TOTAL-REVENUES> 205,353
<CGS> 115,260
<TOTAL-COSTS> 193,320
<OTHER-EXPENSES> (3,010)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 176
<INCOME-PRETAX> 14,867
<INCOME-TAX> 4,800
<INCOME-CONTINUING> 10,067
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 10,067
<EPS-PRIMARY> .43
<EPS-DILUTED> .43
</TABLE>
