<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 28, 1996 Commission File Number 1-4289
GTI CORPORATION
Delaware IRS ID# 05-0278990
9715 Business Park Drive
San Diego, California 92131
Telephone (619)537-2500
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
--- ---
As of November 1, 1996, the registrant had only one class of Common Stock, par
value $.04 per share, of which there were 8,973,475 shares outstanding.
This report on Form 10-Q contains 14 pages.
<PAGE> 2
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
GTI CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS -
(Unaudited) (In thousands, except per share data)
<TABLE>
<CAPTION>
For the three months ended
--------------------------
September 28, 1996 September 30, 1995
------------------ ------------------
<S> <C> <C>
Sales $ 24,586 $ 35,308
Costs of sales 19,852 23,596
Selling, general & administrative expenses 9,942 8,436
----------- ------------
Operating profit (loss) (5,208) 3,276
Other expenses 36 301
----------- ------------
Income (loss) from continuing operations before
income taxes and minority interest (5,244) 2,975
Provision (benefit) for income taxes (100) 591
Minority interest (17) (66)
----------- ------------
Income (loss) from continuing operations (5,127) 2,450
Income from discontinued operations, net
of income taxes -- 397
----------- ------------
Net income (loss) (5,127) 2,847
Dividend requirement on preferred stock (71) --
----------- ------------
Net income (loss) applicable to common stockholders $ (5,198) $ 2,847
=========== ============
Earnings (losses) per common share:
Continuing operations $ (0.58) $ 0.22
Discontinued operations -- 0.04
----------- ------------
$ (0.58) $ 0.26
=========== ============
Weighted average number of shares 8,973,475 10,947,000
=========== ============
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
2
<PAGE> 3
GTI CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - (Unaudited)
(In thousands, except per share data)
<TABLE>
<CAPTION>
For the nine months ended
-------------------------
September 28, 1996 September 30, 1995
------------------ ------------------
<S> <C> <C>
Sales $ 82,224 $ 95,344
Costs of sales 64,003 64,921
Selling, general & administrative expenses 29,192 25,075
----------- ------------
Operating profit (loss) (10,971) 5,348
Other expenses 125 891
----------- ------------
Income (loss) from continuing operations before
income taxes and minority interest (11,096) 4,457
Provision (benefit) for income taxes (1,050) 877
Minority interest (516) (155)
----------- ------------
Income (loss) from continuing operations (9,530) 3,735
Income from discontinued operations, net
of income taxes -- 1,280
----------- ------------
Net income (loss) (9,530) 5,015
Dividend requirement on preferred stock (213) --
----------- ------------
Net income (loss) applicable to common stockholders $ (9,743) $ 5,015
=========== ============
Earnings (losses) per common share:
Continuing operations $ (1.09) $ 0.34
Discontinued operations -- 0.12
----------- ------------
$ (1.09) $ 0.46
=========== ============
Average number of common shares outstanding 8,973,475 10,871,000
=========== ============
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
3
<PAGE> 4
GTI CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
Assets
<TABLE>
<CAPTION>
September 28, 1996 December 31, 1995
------------------ -----------------
(Unaudited) (Audited)
Current assets:
<S> <C> <C>
Cash and cash equivalents $ 3,750 $ 2,553
Accounts receivable, net of allowances of
$600 and $297, respectively 11,444 22,257
Inventories 19,803 31,318
Prepaid expenses 5,349 4,036
Net assets of discontinued operations -- 3,623
--------- --------
Total current assets 40,346 63,787
Property, plant and equipment, net 18,240 17,109
Goodwill, less amortization of $5,514 and
$4,360, respectively, and other assets 40,900 39,912
--------- --------
$ 99,486 $120,808
========= ========
Liabilities and Stockholders' Equity
Current liabilities:
Short term borrowings $ 3,727 $ 4,234
Accounts payable, accrued liabilities and
other liabilities 14,094 24,776
--------- --------
Total current liabilities 17,821 29,010
Other non-current liabilities 2,495 2,367
Minority interest in subsidiary -- 436
Stockholders' equity:
Preferred stock, $35.00 cumulative
convertible, issued and outstanding
8,110 shares 8,110 8110
Common stock, issued and outstanding
8,973,475 shares 359 359
Additional paid in capital 44,082 44,082
Retained earnings 26,656 36,399
Cumulative translation adjustments (37) 45
--------- --------
79,170 88,995
--------- --------
$ 99,486 $120,808
========= ========
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
4
<PAGE> 5
GTI CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - (Unaudited)
(In thousands)
<TABLE>
<CAPTION>
For the nine months ended
-------------------------
September 29, 1996 September 30, 1995
------------------ ------------------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ (9,530) $ 5,015
Adjustments to reconcile net income (loss) to
net cash provided (used) by continuing operations
Depreciation and amortization 4,221 4,966
Minority interest in subsidiary (516) (155)
Hong Kong cost reduction program 1,900 --
Income from discontinued operations -- (1,280)
Changes in assets and liabilities:
Accounts receivable 10,813 (1,670)
Inventories 11,515 (3,175)
Prepaid expenses and other assets (1,475) (1,004)
Accounts payable, accrued liabilities, and
other liabilities (12,796) (3,600)
-------- --------
Net cash provided (used) by continuing
operations 4,132 (903)
Net cash provided (used) by discontinued operations (347) 1,167
-------- --------
Net cash provided by operating activities 3,785 264
-------- --------
Cash flows from investing activities:
Purchases of equipment (4,198) (3,788)
Capital expenditures by discontinued operations -- (554)
Proceeds from sale of discontinued business 2,412 --
Business acquisition, net of cash acquired -- (19,089)
-------- --------
Net cash used by investing activities (1,786) (23,431)
-------- --------
Cash flows from financing activities:
Borrowings (repayments) on lines of credit, net (507) 8,093
Borrowings on note payable -- 5,000
Repayments on note payable -- (750)
Issuance of common stock -- 10,259
Preferred cash dividend (213) (213)
-------- --------
Net cash provided (used) by financing activities (720) 22,389
-------- --------
Effect of exchange rate on cash (82) 97
-------- --------
Net increase (decrease) in cash and cash equivalents 1,197 (681)
Cash and cash equivalents at beginning of period 2,553 4,226
-------- --------
Cash and cash equivalents at end of period $ 3,750 $ 3,545
======== ========
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
5
<PAGE> 6
GTI CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except per share data)
Note 1 - Basis Of Presentation
The unaudited interim condensed consolidated financial statements presented
herein have been prepared in accordance with the instructions to Form 10-Q and
do not include all of the information and note disclosures required by generally
accepted accounting principles. The Company believes that the disclosures
contained herein are adequate to make the financial information not misleading.
In the opinion of management, these condensed consolidated financial statements
contain all adjustments (consisting of normal recurring accruals) necessary to
present fairly the Company's condensed consolidated statements of operations,
balance sheets, and statements of cash flows. These interim condensed
consolidated financial statements should be read in conjunction with the
consolidated financial statements and notes thereto included in the Company's
Annual Report on Form 10-K for the year ended December 31, 1995. The condensed
consolidated statements of operations for the three and nine months ended
September 28, 1996 may not be indicative of the expected results for the year
ended December 31, 1996.
The condensed consolidated financial statements include the accounts of GTI
Corporation (the "Company"), its wholly-owned subsidiary Valor Electronics, Inc.
("Valor") and its majority-owned subsidiary Promptus Communications, Inc.
("Promptus"). All significant intercompany transactions and account balances
have been eliminated in consolidation.
Effective January 1, 1996, the Company has changed its quarterly period end
dates. The future quarterly period end dates will be the close of business on
the thirteenth Saturday of every quarter. The Company's year end will continue
to be December 31. Prior period amounts have not been restated due to the
immaterial amounts involved.
Effective January 1, 1996, the Company adopted Statement of Financial Accounting
Standards No. 123 ("SFAS 123"), Accounting for Stock-Based Compensation, which
provides companies the option to account for equity instrument awards based on
their estimated fair value at the date of grant resulting in a charge to income
in the periods the awards are expected to vest. However, companies are permitted
to continue to apply APB Opinion No. 25, which recognizes compensation cost
based on the intrinsic value of the equity award. The Company will continue to
apply APB Opinion No. 25 and will present pro forma footnote disclosure
describing the effect to the Company's net income and net income per share data
as permitted by SFAS 123.
6
<PAGE> 7
GTI CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except per share data)
Note 2 - Supplemental Statements of Cash Flows Disclosure
Supplemental cash flow information (unaudited) for the nine months ended
September 28, 1996 and for the nine months ended September 30, 1995 are
summarized as follows:
<TABLE>
<CAPTION>
Nine Months Ended
September 28, 1996 September 30, 1995
------------------ ------------------
<S> <C> <C>
Interest paid $ 251 $ 898
======== ========
Income taxes paid $ 2,813 $ 1,260
======== ========
Business acquisition, net of cash acquired:
Working capital, other than cash
acquired $ -- $ (644)
Plant and equipment -- (1,314)
Purchase price in excess of the net
assets acquired -- (17,230)
Other assets -- (1,183)
Noncurrent liabilities -- 1,282
-------- --------
Net cash used to acquire a business $ -- $ 19,089
======== ========
</TABLE>
Note 3 - Inventories
Inventories, stated at the lower of cost (first-in, first-out) or market, are
summarized as follows:
<TABLE>
<CAPTION>
September 28, 1996 December 31, 1995
(Unaudited) (Audited)
<S> <C> <C>
Raw materials and supplies $ 6,114 $10,604
Work in process 2,764 10,574
Finished goods 10,925 10,140
------- -------
Total inventories $19,803 $31,318
======= =======
</TABLE>
7
<PAGE> 8
GTI CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except per share data)
Note 4 - Contingencies
Concurrent with the Promptus acquisition, the Company and the minority
shareholders of Promptus entered into an agreement (the "Agreement") to govern
the contingent purchase of the remaining 28% of the outstanding capital stock of
Promptus. Under the Agreement, beginning in January 1997 and each year
thereafter through January 1999, the minority shareholders of Promptus have the
right but not the obligation to require the Company to acquire the remaining
shares in predefined percentage increments; and the Company has the right but
not the obligation to purchase the remaining shares, with the price to be paid
based upon a predetermined formula using a combination of forecasted and actual
results of Promptus for the period January 1, 1997 through December 31, 1999.
The percentage increment established for the first mutual put/call option in
January 1997 may not exceed 30% of the minority shares. The Agreement stipulates
that a predefined portion (equal to the original per share price paid in January
1995) of the purchase price for the remaining Promptus shares must be made in
cash. The remaining portion of the purchase price can be made in cash, the
Company's common stock, or any combination thereof at the option of the Company.
In management's opinion, there is no assurance that the minority shareholders
will exercise their rights nor is it presently possible to assess the
probability of whether the Company will purchase the minority shares. In
addition, due to the determinants involved in establishing a price for the
minority shares, it is not presently possible to estimate the price at which
such shares might be purchased. Accordingly, no accounting recognition has been
provided for this contingency in the accompanying consolidated financial
statements. Under terms of the agreement, the minority shareholders have joint
participation rights. If the Company sells or otherwise disposes of its Promptus
shares, the Promptus minority shareholders have the right to sell or otherwise
dispose of their shares on substantially equivalent terms as the Company.
In July 1996, Valor filed a complaint in the Superior Court of the State of
California for the County of San Diego against a competitor and certain of its
employees alleging misappropriation of trade secrets, breach of certain
confidentiality agreements, and unfair competition. The Company is seeking
unspecified damages. In August 1996, the competitor filed a cross-complaint
against the Company alleging abuse of process, defamation, unfair competition,
and declaratory relief. The competitor is seeking unspecified damages. The
complaint is in the preliminary stages of discovery and pleadings. Additionally,
the Company intends to vigorously pursue its case and defend itself from the
cross-complaint. Because the outcome of the Company's complaint is uncertain at
this time and that management believes the competitor's cross-complaint is
without merit, no amounts have been recorded in the Company's condensed
consolidated financial statements as of September 28, 1996 for any loss or gain
that could result from this litigation.
8
<PAGE> 9
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Dollar amounts are expressed in thousands, except per share amounts.
Quarter Ended September 28, 1996:
Results of Operations
For the third quarter ended September 28, 1996, the Company reported
consolidated sales of $24,586, a decrease of 30.4% from $35,308 for the same
period ended September 30, 1995. Consolidated sales for the nine-months ended
September 28, 1996 were $82,224, a decrease of 13.8% from $95,344 for the
nine-months ended September 30, 1995. This sales decrease is primarily a result
of decreased unit volume of Valor LAN magnetics-based components. Valor sales
for the third quarter of 1996 were $20,560, a decrease of 34.6% from $31,370 for
the same period one year ago. Promptus sales increased 2.2% to $4,026 for the
third quarter of 1996 from $3,938 during the same period one year ago.
Consolidated sales to foreign customers for the third quarter of 1996
represented approximately 38.8% of sales, compared to 36.8% for the third
quarter of 1995. This increase is a result of increased sales, as a percentage
of consolidated sales, to Valor Pacific Rim customers as well as a decrease, as
a percentage of sales, to Valor's domestic customers. In absolute dollars, both
foreign and domestics sales decreased during the third quarter of 1996, when
compared to the same quarterly period one year ago.
Two Valor OEM customers collectively accounted for 25.9% and 31.2% of
consolidated and Valor sales, respectively, for the three-months ended September
28, 1996. Although no single Promptus customer accounts for 10% of consolidated
sales, two OEM customers collectively accounted for approximately 45.8% of
Promptus's sales for the three-months ended September 28, 1996. The sales
percentage from Valor's and Promptus's OEM customers has historically fluctuated
and may continue to vary in future periods. Management believes that future
sales concentration to these OEM customers is likely to continue; consequently,
such concentration may adversely affect both average selling prices, future
sales growth, and gross margins as a percentage of sales.
Consolidated cost of sales as a percent of sales was 80.8%, 77.8%, 66.8% and
68.1%, for the third quarter of 1996, the nine-months ended September 28, 1996,
third quarter of 1995 and the nine-months ended September 30, 1995,
respectively, resulting in gross margins of 19.2%, 22.2%, 33.2% and 31.9%,
respectively. The decrease in gross margins as a percent of sales for the third
quarter and nine-months ended September 28, 1996 was primarily the result of the
relationship of Valor's fixed manufacturing costs to significantly decreased
production volumes. In addition, Promptus's gross margin as a percentage of
sales decreased as a result of reduced average selling prices of Network System
products to one significant OEM customer.
In July 1996, management assessed Valor's Hong Kong operations and cost
structure. Based on its assessment, management initiated a fixed cost reduction
program. This cost reduction program eliminated a significant portion of fixed
costs in Valor's Hong Kong
9
<PAGE> 10
operations without decreasing production capacity. Due to the cost reduction
program, the Company recorded a charge to income for the three-months ended
September 28, 1996 of approximately $1.9 million. The cost reduction charge
represents employee severance costs, property lease costs, and the write off of
certain assets.
Selling, general and administrative expenses for the third quarter of 1996 were
$9,942 or 40.4% of sales, compared to $8,436 or 23.9% of sales for the
comparable period one year ago. These expenses increased in percentage and
dollar terms principally due to the inclusion of the $1,900 in charges
associated with the closure of the Hong Kong operation. Promptus's selling,
marketing, and engineering costs increased both in absolute dollars and as a
percentage of sales for the third quarter of 1996 when compared to the same
quarter one year ago. The Company believes that these Promptus expenses may
begin to stabilize in absolute dollars but may vary as a percentage of future
sales, when compared to comparable periods in the prior year. Until Promptus
generates and sustains a base of sales sufficient to support the current and
future level of spending, its selling, general and administrative spending will
continue to be disproportionate to sales.
Other expense (net) for the third quarter of 1996 was $36 compared to $301 for
the third quarter of 1995. The net decrease in other expense compared to the
third quarter of 1995 is a direct result of a significant decrease in interest
expense. This decrease in interest expense is associated with the Company's
repayment of a note payable and a significant paydown of bank credit facilities
in December 1995. Additionally, interest income for the third quarter of 1996
increased from one year ago as a result of interest earned on the notes
receivable obtained from the sale of two divested businesses.
The Company's effective tax rate is currently lower than the statutory United
States rate due to higher tax rates on the earnings of a certain foreign
operation offset by the Company's United States based operating losses. A
significant portion of these United States based losses relate to Promptus's
operating losses from which the Company does not benefit.
The loss from continuing operations and loss per common share for the third
quarter of 1996 of approximately $5,127 and $0.58, respectively, as compared to
income from continuing operations and income per common share of $2,450 and
$0.22, respectively, for the comparable quarter one year ago, is primarily due
to decreased Valor sales volume, decreased Valor gross profit as a percentage
of sales, and a one time charge associated with the Hong Kong closure.
Additionally, the loss per share of common stock for the third quarter of 1996
excludes the anti dilutive impact of the assumed conversion of the Company's
cumulative convertible preferred stock, which is convertible into 1,900,287
shares of common stock and includes the associated preferred dividend to arrive
at net loss applicable to common stockholders.
Income from discontinued operations for the third quarter of 1996 decreased to
zero from $397 or $0.04 per common share for the same period in the prior year.
This decrease is a result of the Company's sale of both the electronic
components and equipment segment and the electronic supply segment during
December 1995 and February 1996, respectively.
10
<PAGE> 11
Backlog at September 28, 1996, was $16.7 million, compared to $34.8 million at
September 30, 1995. Valor's backlog was $14.6 million at September 28, 1996,
compared to $33.0 million at September 30, 1995. Valor's backlog for the third
quarter reflects decreased volume as compared to the same period one year ago.
The Company's backlog at the beginning of each quarterly period is not
indicative of sales for the future quarterly period. The Company's sales for any
future quarterly period are dependent upon obtaining orders in a quarter for
shipment within the same quarter. If these orders do not materialize, this could
have an adverse affect on the Company's operating results for that quarterly
period. Additionally, the Company's future performance on a quarter-to-quarter
basis will be affected by the volume, mix and timing of orders received.
Liquidity and Capital Resources
The Company is currently satisfying its working capital and capital expenditure
requirements through internally generated cash from operations and bank
borrowings. The ratio of current assets to current liabilities was 2.3 to 1.0 on
September 28, 1996, compared to 2.2 to 1.0 on December 31, 1995. Net cash
provided by continuing operations for the first nine months of 1996 was $4,132
compared to cash used by continuing operations of $903 for the first nine months
of 1995. This increase is attributable, in part, to reduced levels of accounts
receivable and inventories. These cash increases are offset by an increase in
net losses and a decrease in accounts payable, accrued liabilities and other
liabilities.
In the first nine months of 1996, the Company made capital expenditures
approximating $4,200. These expenditures were primarily for equipment to support
production capacity for Valor. The Company anticipates that additional capital
expenditures of approximately $1.5 million will be made during the balance of
1996, primarily for Valor manufacturing and process engineering equipment.
Management believes that funds on hand; those generated by operations; funds
available through its $10.0 million line of credit with a domestic bank, of
which approximately $5.8 was eligible as of September 28, 1996; and other
financing alternatives available to the Company will be sufficient to finance
working capital and currently projected capital expenditure requirements at
least through the next twelve months. Currently, the Company is investigating
the expansion of credit facilities to include foreign based assets in the
Company's borrowing base, and the Company believes it has the ability to
complete the credit facility expansion. In addition, the Company has retained a
financial advisor to pursue strategic alternatives related to Promptus,
including but not limited to its sale, to maximize shareholder value. The
Company can give no assurance that any expansion of credit facilities or any
Promptus strategic alternative will be on terms satisfactory to the Company or
that such agreements would be completed in a timely manner; however, the
Company believes it has the ability to complete these possible transactions. As
of November 11, 1996, outstanding borrowings from a domestic bank totaled
approximately $4,300 based on an eligible base of $5,360. In November 1996, due
to the Company moving a significant portion of its foreign based assets from
Hong Kong to the People's Republic of China, the $2.2 million foreign bank line
of credit was terminated.
Pursuant to the terms of the Agreement, the first mutual put/call option for 30%
of the remaining Promptus shares is in January 1997. Due to the determinants
involved in establishing a price for the minority shares, it is not presently
possible to estimate the price at which such shares might be purchased. Under
terms of the Agreement, the minority shareholders have joint participation
rights. If the Company sells or otherwise disposes its Promptus shares, the
11
<PAGE> 12
Promptus minority shareholders have the right to sell or otherwise dispose their
shares on substantially equivalent terms as the Company. Management believes
that an agreement can be reached between the Company and the Promptus minority
shareholders such that the terms of any Promptus strategic alternative will be
on equivalent terms; and, if the Company is required to purchase any Promptus
shares pursuant to the Agreement, the cash payment, if any, could be satisfied.
Dividends on the Company's 8,110 shares of outstanding $35.00 cumulative
convertible preferred stock accrue at an annual rate of $35.00 per share,
payable quarterly. In the first nine months ended September 28, 1996, cash
dividends totaling $213 were paid.
This report contains forward-looking statements that involve substantial risks
and uncertainties. The Company's actual results could differ materially from
those discussed herein. Factors that could cause or contribute to such
differences include, but are not limited to, those discussed in the "Business",
"Management's Discussion and Analysis of Financial Condition and Results of
Operations", and "Prospective Information" in the Company's Form 10-K dated
December 31, 1995, including, without limitation, the "Company's Products,
Competition, Manufacturing and Suppliers, Foreign Operations and Backlog".
12
<PAGE> 13
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
In December 1995, a class-action lawsuit was filed in the United
States District Court, Southern District of California, against
the Company and certain of its officers and directors alleging
violations of the Securities Exchange Act of 1934. Specifically,
the complaint asserts, among other claims, that the Company
artificially inflated the value of its stock by making false and
misleading statements about expected financial results. In July
1996, the Company entered into a Stipulation of Settlement which
is subject to the court's approval. Pursuant to that Stipulation,
all claims will be released. The settlement amount is $1 million
of which $400 will be paid by the Company.
In July 1996, Valor filed a complaint in the Superior Court of the
State of California for the County of San Diego against a
competitor and certain of its employees alleging misappropriation
of trade secrets, breach of certain confidentiality agreements,
and unfair competition. The Company is seeking unspecified
damages. In August 1996, the competitor filed a cross-complaint
against the Company alleging abuse of process, defamation, unfair
competition, and declaratory relief. The competitor is seeking
unspecified damages. The complaint is in the preliminary stages of
discovery and pleadings. Additionally, the Company intends to
vigorously pursue its case and defend itself from the
cross-complaint. Because the outcome of the Company's complaint
is uncertain at this time and that management believes the
competitor's cross-complaint is without merit, no amounts have
been recorded in the Company's condensed consolidated financial
statements as of September 28, 1996 for any loss or gain that
could result from this litigation.
Item 4. Submission of matters to a Vote of Security Holders
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Exhibit 27 - Financial Data Schedule.
(b) Reports on Form 8-K
None.
13
<PAGE> 14
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.
GTI CORPORATION
---------------
(Registrant)
Date: November 12, 1996
-----------------
By: /s/ Douglas J. Downs
-------------------------------------
Douglas J. Downs
Vice President Finance and Treasurer
(Principal Financial and
Accounting Officer)
14
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUN-30-1996
<PERIOD-END> SEP-28-1996
<EXCHANGE-RATE> 1
<CASH> 3,750
<SECURITIES> 0
<RECEIVABLES> 12,044
<ALLOWANCES> (600)
<INVENTORY> 19,803
<CURRENT-ASSETS> 40,346
<PP&E> 31,813
<DEPRECIATION> (13,573)
<TOTAL-ASSETS> 99,486
<CURRENT-LIABILITIES> 17,821
<BONDS> 0
0
8,110
<COMMON> 359
<OTHER-SE> 61,701
<TOTAL-LIABILITY-AND-EQUITY> 99,486
<SALES> 24,586
<TOTAL-REVENUES> 24,586
<CGS> 19,586
<TOTAL-COSTS> 9,942
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 36
<INCOME-PRETAX> (5,244)
<INCOME-TAX> (100)
<INCOME-CONTINUING> (5,127)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (5,127)
<EPS-PRIMARY> (0.58)
<EPS-DILUTED> 0
</TABLE>
