<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
( X ) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1999
---------------------------------------------
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 0-8410
---------------------------------------
WYANT CORPORATION
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
New York 11-2236837
- -------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1170 U.S. Highway 22 East, Suite 203, Bridgewater, New Jersey 08807
- ------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code 514-636-9926
100 Readington Road Somerville, New Jersey 08876
- -------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report.)
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 requirement for the past 90 days.
Yes X No
------- -----------
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the close of the latest practicable date.
Class Outstanding at August 11, 1999
- -------------------------------------------------------------------------------
Common stock, $.01 par value 2,273,817
1
<PAGE> 2
WYANT CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The attached unaudited consolidated financial statements of Wyant Corporation
and Subsidiaries reflect all adjustments which are, in the opinion of
management, necessary to present a fair statement of the operating results for
the interim periods.
Consolidated balance sheet 3
Consolidated statement of operations 4
Consolidated statement of cash flows 5
Consolidated statement of stockholders' equity 6
Notes to consolidated financial statements 7-11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
2
<PAGE> 3
PART 1. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
WYANT CORPORATION
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
<TABLE>
<CAPTION>
JUNE 30 December 31
1999 1998
---- ----
<S> <C> <C>
ASSETS
CURRENT
Cash and cash equivalents $ 82,941 $ 59,985
Accounts receivable 14,501,287 10,215,812
Inventories (note 3) 8,842,826 8,576,960
Net assets held for divestiture (note 2) 9,684,231 9,203,356
Other 868,117 1,393,270
----------- -----------
TOTAL CURRENT ASSETS 33,979,402 29,449,383
Property, plant and equipment, net of
accumulated amortization of $12,381,330
(December 31, 1998 - $11,474,155) 10,813,372 8,593,460
Other assets 5,166,780 4,496,821
----------- -----------
TOTAL ASSETS $49,959,554 $42,539,664
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT
Revolving line of credit $ 7,704,525 $ 4,092,128
Committed revolving credit facility 4,894,262 4,238,720
Accounts payable 6,054,075 4,856,657
Accrued expenses 2,504,611 3,228,412
Income taxes payable 965,868 433,288
Current portion of long-term debt (note 4) 1,454,094 1,061,332
Current portion of preferred stock of subsidiary 537,864 513,204
----------- -----------
TOTAL CURRENT LIABILITIES 24,115,299 18,423,741
Long-term debt (notes 4 & 6) 4,771,366 3,887,593
Preferred stock of subsidiary (note 6) 5,305,677 5,477,072
Deferred income taxes 1,790,448 2,076,416
STOCKHOLDERS' EQUITY
Common stock, par value $0.01 per share 27,053 27,053
Additional paid-in capital 6,821,825 6,821,825
Retained earnings 7,380,759 6,326,679
Cumulative translation adjustment (252,873) (500,715)
----------- -----------
TOTAL STOCKHOLDERS' EQUITY 13,976,764 12,674,842
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $49,959,554 $42,539,664
=========== ===========
</TABLE>
See accompanying notes
3
<PAGE> 4
WYANT CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED JUNE 30 SIX MONTHS ENDED JUNE 30
-------------------------- ------------------------
1999 1998 1999 1998
----- ---- ---- ----
(Restated) (Restated)
<S> <C> <C> <C> <C>
Net sales $20,300,939 $15,862,699 $38,826,298 $31,412,811
Cost of sales 13,133,803 9,919,381 25,382,323 20,085,845
----------- ----------- ----------- -----------
Gross profit 7,167,136 5,943,318 13,443,975 11,326,966
Expenses
Selling 3,982,180 3,003,690 7,571,700 6,010,630
General and administration 2,385,554 1,872,863 4,571,687 3,709,991
Amortization 147,270 110,469 291,180 201,512
Interest expense 336,391 280,924 646,276 529,538
Other income (23,106) (6,084) (149,546) (85,679)
----------- ----------- ----------- -----------
6,828,289 5,261,862 12,931,297 10,365,992
----------- ----------- ----------- -----------
Income from continuing operations
before income taxes 338,847 681,456 512,678 960,974
Income tax expense
Current 133,800 268,800 203,500 364,400
Deferred 22,200 30,000 43,500 59,000
----------- ----------- ----------- -----------
156,000 298,800 247,000 423,400
----------- ----------- ----------- -----------
Income from continuing operations 182,847 382,656 265,678 537,574
Discontinued operations, net of income
taxes (note 2) (1) 567,353 348,141 974,053 703,197
----------- ----------- ----------- -----------
Net income 750,200 730,797 1,239,731 1,240,771
Dividends and accretion of mandatorily
redeemable preferred stock 90,690 85,740 185,651 161,186
----------- ----------- ----------- -----------
Net income attributable to common shares $ 659,510 $ 645,057 $ 1,054,080 $ 1,079,585
=========== =========== =========== ===========
Per common share (note 5)
BASIC
Income from continuing operations $ 0.02 $ 0.08 $ 0.02 $ 0.10
Discontinued operations 0.16 0.10 0.27 0.20
Net income 0.18 0.18 0.29 0.30
DILUTED
Income from continuing operations 0.02 0.08 0.02 0.10
Discontinued operations 0.15 0.09 0.25 0.19
Net income 0.18 0.17 0.29 0.29
(1) Income taxes of discontinued operations $ 304,700 $ 192,200 $ 517,000 $ 386,600
</TABLE>
See accompanying notes
4
<PAGE> 5
WYANT CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
1999 1998
---- ----
[Restated]
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income from continuing operations $ 265,678 $ 537,574
Adjustments to reconcile net income to net cash provided by
operating activities
Depreciation and amortization 615,174 523,750
Gain on sale of fixed assets 1,715 9,107
Deferred income tax expense 92,818 40,000
Deferred pension costs (16,704) (63,040)
Changes in non-cash working capital balances
Accounts receivable (3,964,555) 222,430
Inventories (151,166) (668,136)
Other current assets 98,770 (185,888)
Accounts payable 473,617 199,470
Income taxes payable 532,580 (471,536)
Cash provided by discontinued operations 562,341 943,488
---------- ----------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (1,489,732) 1,087,219
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of businesses, net of cash acquired (1,053,625) (3,861,450)
Capital expenditures (2,254,117) (412,248)
Cash proceeds from sale of fixed assets 5,357 3,823
Decrease in other assets -- 16,220
Cash used for discontinued operations (69,163) (48,775)
---------- ----------
NET CASH USED IN INVESTING ACTIVITIES (3,371,548) (4,302,430)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in committed revolving credit facility 655,542 (41,728)
Repayment of long-term debt (657,019) (255,200)
Increase in long-term debt 1,654,205 3,723,111
Redemption of preferred shares (513,204) (550,122)
Dividends paid by subsidiary (84,380) (98,464)
Issue of common shares -- 15,688
Increase in bank indebtedness 3,612,397 422,425
Cash provided by discontinued operations -- 80,101
---------- ----------
NET CASH PROVIDED BY FINANCING ACTIVITIES 4,667,541 3,295,811
Effect of exchange rate changes on cash 216,695 (157,181)
---------- ----------
Net increase (decrease) in cash and cash equivalents 22,956 (76,581)
Cash and cash equivalents, beginning of period 59,985 156,131
---------- ----------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 82,941 $ 79,550
========== ==========
</TABLE>
See accompanying notes
5
<PAGE> 6
WYANT CORPORATION
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
1999 1998
------ ------
<S> <C> <C>
COMMON STOCK AT PAR VALUE
Balance at beginning of period $ 27,053 $ 27,037
Stock issued for options exercised -- 16
----------- -----------
BALANCE AT END OF PERIOD 27,053 27,053
----------- -----------
ADDITIONAL PAID-IN CAPITAL
Balance at beginning of period 6,821,825 6,806,867
Stock issued for options exercised -- 15,671
----------- -----------
BALANCE AT END OF PERIOD 6,821,825 6,822,538
----------- -----------
RETAINED EARNINGS
Balance at beginning of period 6,326,679 5,112,006
Net income 1,239,731 1,240,771
Dividends declared by subsidiary (84,380) (98,464)
Accretion on preferred shares of subsidiary (101,271) (62,722)
----------- -----------
BALANCE AT END OF PERIOD 7,380,759 6,191,591
----------- -----------
ACCUMULATED OTHER COMPREHENSIVE INCOME
Balance at beginning of period (500,715) (165,925)
Foreign currency translation adjustments 247,842 (129,793)
----------- -----------
BALANCE AT END OF PERIOD (252,873) (295,718)
----------- -----------
TOTAL STOCKHOLDERS' EQUITY $13,976,764 $12,745,464
=========== ===========
COMPREHENSIVE INCOME
Net income $ 1,239,731 $ 1,240,771
Other - Foreign currency translation adjustments 247,842 (129,793)
----------- -----------
COMPREHENSIVE INCOME FOR PERIOD $ 1,487,573 $ 1,110,978
=========== ===========
COMMON SHARES
Number of common shares issued at beginning of period 2,273,817 2,271,484
Shares issued for options exercised during period -- 2,333
----------- -----------
NUMBER OF COMMON SHARES ISSUED AND OUTSTANDING 2,273,817 2,273,817
COMMON SHARES ISSUABLE UPON CONVERSION
OF EXCHANGEABLE SHARES 1,333,333 1,333,333
----------- -----------
NUMBER OF COMMON SHARES ISSUED, ISSUABLE AND OUTSTANDING 3,607,150 3,607,150
=========== ===========
</TABLE>
See accompanying notes
6
<PAGE> 7
WYANT CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(INFORMATION AS AT JUNE 30, 1999 AND FOR THE SIX MONTHS
ENDED JUNE 30, 1999 AND 1998 ARE UNAUDITED)
1. GENERAL
The accompanying unaudited consolidated financial statements include the
accounts of Wyant Corporation and its wholly-owned subsidiaries, IFC
Disposables, Inc. and Wood Wyant Inc. They have been prepared in accordance
with accounting principles generally accepted in the United States for
interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of
management, the accompanying consolidated financial statements contain all
adjustments, consisting only of normal recurring accruals considered
necessary to present fairly the financial position as of June 30, 1999,
the results of operations for the six months and three months ended June
30, 1999 and 1998 and cash flows and changes in stockholders' equity for
the six months ended June 30, 1999 and 1998. For further information, refer
to the financial statements and notes thereto included in the Company's
annual report for the year ended December 31, 1998.
2. DISCONTINUED OPERATIONS
On December 17, 1998, the Board of Directors authorized management to
pursue the sale of the Company's Wyant Health Care Division ("Division").
On February 23, 1999 the Board approved the sale of the Division to
Paper-Pak Products, Inc. ("PaperPak"), subject to completion of buyer
financing, customary regulatory approvals and the approval of the Company's
shareholders. Consequently, the results of the Division have been reported
in these financial statements as discontinued operations.
The operating results of the Division are as follows:
<TABLE>
<CAPTION>
Six months ended June 30,
--------------------------------
1999 1998
------ ------
<S> <C> <C>
Net sales $20,889,297 $19,399,393
Income before income taxes 1,491,053 1,089,796
</TABLE>
The sale of the Division closed on July 21, 1999. Determination of the
final selling price will be made during the third quarter of 1999.
7
<PAGE> 8
3. INVENTORIES
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
------ ------
<S> <C> <C>
Raw materials $2,249,341 $2,065,073
Finished goods 6,593,485 6,511,887
---------- ----------
$8,842,826 $8,576,960
========== ==========
</TABLE>
4. LONG-TERM DEBT
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
------ ------
<S> <C> <C>
Wood Wyant Inc.
Term loan repayable in monthly installments
of Cdn. $20,476 plus interest at prime plus
3/4% (prime at June 30, 1999 - 6.25%),
maturing October 1, 2001. Principal amount
Cdn. $1,569,999 (December 31, 1998
- Cdn. $1,692,856) $1,073,137 $1,104,060
Term loan repayable in monthly installments
of Cdn. $35,000 plus interest at prime plus
3/4%, maturing April 30, 2003. Principal
amount Cdn. $1,610,000 (December 31, 1998
- Cdn. $1,820,000) 1,100,478 1,186,982
Term loan repayable in monthly installments
of Cdn. $49,523 plus interest at prime plus
3/4%, maturing June 30, 2003. Principal
amount Cdn. $2,377,069 (December 31, 1998
- Cdn. $2,674,207) 1,624,791 1,744,086
Term loan repayable in monthly installments
of Cdn. $41,667 plus interest at prime plus
3/4%, maturing March 15, 2004. Principal
amount Cdn. $2,333,332 1,594,895 --
Revolving credit facility (Cdn. $1,217,449
- December 31, 1998 - Cdn. $1,401,125) 832,159 913,797
---------- ----------
6,225,460 4,948,925
Current portion 1,454,094 1,061,332
---------- ----------
$4,771,366 $3,887,593
========== ==========
</TABLE>
8
<PAGE> 9
5. EARNINGS PER SHARE
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30 June 30
------------------------- ------------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Numerator
Income from continuing operations $ 182,847 $ 382,656 $ 265,678 $ 537,574
Preferred stock dividends and accretion 90,690 85,740 185,651 161,186
---------- ---------- ---------- ----------
Numerator for basic earnings per share -
income from continuing operations available
to common stockholders 92,157 296,916 80,027 376,388
Accretion on convertible preferred shares 29,035 8,722 57,342 8,722
---------- ---------- ---------- ----------
Numerator for diluted earnings per share -
income from continuing operations available
to common stockholders $ 121,192 $ 305,638 $ 137,369 $ 385,110
========== ========== ========== ==========
Denominator
Denominator for basic earnings per share -
weighted-average shares issued, issuable and
outstanding 3,607,150 3,605,835 3,607,150 3,605,329
Effect of dilutive securities
Convertible securities 283,111 89,963 283,111 45,230
Stock options -- 153,307 -- 120,670
---------- ---------- ---------- ----------
Denominator for diluted earnings per share -
adjusted weighted-average shares 3,890,261 3,849,105 3,890,261 3,771,229
========== ========== ========== ==========
Basic earnings per share from continuing operations $ 0.02 $ 0.08 $ 0.02 $ 0.10
Diluted earnings per share from continuing
operations $ 0.02 $ 0.08 $ 0.02 $ 0.10
</TABLE>
The effect of the convertible preferred shares has not been included in
computing the diluted earnings per share from continuing operations for
both the three months and six months ended June 30, 1999, since to do so
would be anti-dilutive.
6. PURCHASE OF BUSINESSES
During the second quarter of 1998, the Company, through its wholly-owned
subsidiary, Wood Wyant Inc. acquired 100% of the outstanding shares of
the following companies:
<TABLE>
<S> <C>
April 30, 1998 H.A. Perigord Company Limited
June 26, 1998 Professional Sanitation Products Ltd.
June 30, 1998 Midway Supply Ltd.
Purnel Distributors Ltd.
Midway Purnel Sanitary Supply Ltd.
Fraser Valley Industrial Chemicals Inc.
</TABLE>
9
<PAGE> 10
6. PURCHASE OF BUSINESSES (Cont'd)
Fraser Valley Industrial Chemicals Inc. is a manufacturer of sanitary
chemical products. All of the other acquired companies are distributors of
sanitation products. The acquisitions have been accounted for under the
purchase method. Financial results of the companies are included in the
Company's consolidated statement of operations from the respective dates of
acquisition.
The cost of purchase of the above companies totalled $5,715,895,
including expenses related to the transactions but excluding cash
acquired. This was financed by the issue of 283,111 Class F Preferred
shares of Wood Wyant Inc., with a fair value of $1,861,876 at the
respective transaction dates, with the balance paid in cash. The cash
portion was financed by term bank loans, from which $3,525,440 had been
drawn at June 30, 1999. The Class F Preferred shares are exchangeable at
any time for common shares of Wyant Corporation on a one-for-one basis,
and in addition holders have a one-time option in July 2000 to retract
all of the Class F shares at Cdn. $11.250028 per share, payable in five
equal annual instalments commencing August 3, 2000, with dividends at
3.5% per annum payable monthly from July 1, 2000 if the option is
exercised.
The pro-forma unaudited results of operations for the six months ended
June 30, 1998, assuming consummation of the transactions as of January 1,
1998, are as follows:
<TABLE>
<CAPTION>
Six months ended June 30, 1998
------------------------------
<S> <C>
Net sales $37,680,160
Income from continuing operations 530,185
Net income 1,233,382
Per common share
Income from continuing operations 0.10
Net income 0.28
</TABLE>
7. SEGMENT INFORMATION FROM CONTINUING OPERATIONS
Three months ended June 30
--------------------------
<TABLE>
<CAPTION>
Sanitation Wiping
Products Products Corporate Total
---------- -------- --------- -----
<S> <C> <C> <C> <C>
1999
----
Revenues from external customers $15,607,889 $4,693,050 $20,300,939
Intersegment revenues 1,162,031 96,404 1,258,435
Segment income (loss) before taxes 429,442 64,423 (155,018) 338,847
Segment assets 33,388,590 6,364,403 522,330 40,275,323
1998
----
Revenues from external customers 11,919,178 3,943,521 15,862,699
Intersegment revenues 1,100,734 98,687 1,199,421
Segment income (loss) before taxes 889,767 17,689 (226,000) 681,456
</TABLE>
10
<PAGE> 11
Six months ended June 30
------------------------
<TABLE>
<CAPTION>
Sanitation Wiping
Products Products Corporate Total
---------- ----------- --------- -----
<S> <C> <C> <C> <C>
1999
----
Revenues from external customers $30,014,251 $8,812,047 $38,826,298
Intersegment revenues 1,975,486 181,542 2,157,028
Segment income (loss) before taxes 764,751 87,443 (339,516) 512,678
1998
----
Revenues from external customers 23,419,960 7,992,851 31,412,811
Intersegment revenues 1,932,905 187,450 2,120,355
Segment income (loss) before taxes 1,355,296 101,678 (496,000) 960,974
</TABLE>
8. RECLASSIFICATIONS
Certain prior period amounts have been reclassified to conform with the
presentation in the current period.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following information should be read in conjunction with the accompanying
unaudited financial statements and the notes thereto included in Item I of this
quarterly report, and the financial statements and the notes thereto and
management's discussion and analysis of financial condition and results of
operations contained in the Company's Annual Report on Form 10-K for the year
ended December 31, 1998. As indicated in Note 2 to the consolidated financial
statements, the Company has sold its Wyant Health Care Division and
substantially all of its operating assets. Accordingly, such consolidated
financial statements, as well as the discussion below, reflect the consummation
of this transaction by showing the health care business as "discontinued
operations" for income statement purposes and as "net assets held for
divestiture" for balance sheet purposes.
The following information includes forward-looking statements (within the
meaning of Section 21E of the Securities Exchange Act of 1934) that involve a
number of risks and uncertainties that may influence the financial performance
and earnings of the Company, and may cause actual results to differ materially
from those in the forward-looking statements, including, but not limited to,
factors such as the ability of the Company to successfully integrate the
business and personnel of various acquired businesses into its operations, the
ability to adequately address Year 2000-related issues, the ability to maintain
existing customer relationships and to secure new customers on satisfactory
terms, whether by contract or otherwise, unforeseen price pressure on the
Company's products or significant cost increases that cannot be recovered
through price increases or productivity improvements, the ability to obtain any
necessary financing on reasonably satisfactory terms, the effect of exchange
rate fluctuations and the effect of competitive, capital market and general
economic conditions. Such forward-looking statements, which reflect the
Company's current views with respect to certain future events and financial
performance, should be considered in light of such factors.
11
<PAGE> 12
RESULTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, 1999 COMPARED WITH THE THREE MONTHS
ENDED JUNE 30, 1998
SALES
- -----
Sales of continuing operations for the three months ended June 30, 1999
increased by $4,438,240 or 28.0% to $20,300,939 from the total of $15,862,699 in
the second quarter of 1998, after eliminating inter-segment sales of $1,258,435
in the current quarter and $1,199,421 in the corresponding quarter last year.
Sales of the sanitation products segment were $16,769,920 in the second quarter
of 1999, compared with $13,019,912 in the same quarter in 1998, an increase of
$3,750,008 or 28.8%. The increase resulted primarily from the sales of the
businesses acquired in the second quarter of 1998, together with an increase of
$1,170,000 or 10.7% in direct sales of paper products from the Company's paper
converting operation. Sales of the wiping products segment were $4,789,454 in
the second quarter, an increase of $747,246 or 18.5% over the second quarter of
1998. The improvement was due to higher sales of both wipers and paper
products.
COST OF SALES AND GROSS PROFIT
- ------------------------------
Gross profit of the sanitation products segment was 37.4% of sales for the
current quarter, down from 39.7% in the second quarter last year. The reduction
was due primarily to lower selling prices for paper products. Gross profit of
the wiping products segment improved to 18.2% of sales from 17.2% of sales in
the same quarter in 1998, primarily due to higher margins on paper products.
SELLING EXPENSES
- ----------------
Selling expenses for the second quarter of 1999 totalled $3,982,180, an increase
of $978,490 or 32.6% over the same period last year. In the sanitation products
segment, selling expenses at $3,342,243 were $874,294 or 35.4% higher than in
the second quarter of 1998. The higher expenses resulted primarily from the
added expenses of the acquired businesses, together with additional costs of
approximately $154,000 incurred as a result of challenges associated with the
implementation of new information systems. In the wiping products segment,
selling expenses at $639,937 were $104,196 or 19.4% higher than in the same
period last year. The increase reflected the higher variable costs associated
with the increased level of sales in the quarter.
GENERAL AND ADMINISTRATION EXPENSES
- -----------------------------------
General and administration expenses amounted to $2,385,554 in the second quarter
of 1999, an increase of $512,691 or 27.4% over the second quarter of 1998. In
the sanitation products segment, expenses increased by $492,264 or 28.9% to
$2,195,510, reflecting primarily the added expenses of the businesses acquired
in the second quarter of 1998 and approximately $94,000 of costs resulting from
the new information systems implementation and the reorganization of the
national logistics group. General and administration expenses of the wiping
products segment at $133,531 were $12,914 or 10.7% higher than in the same
quarter last year, primarily as a result of higher staffing costs. Corporate
charges in the current quarter at $56,513 were $7,513 higher than in the second
quarter of 1998.
AMORTIZATION
- ------------
Amortization in the second quarter of 1999 totalled $147,270, an increase of
$36,801 over the same quarter last year. The increase resulted from the
additional amortization from the business acquired in mid-1998 and from the
amortization of goodwill associated with their purchase.
12
<PAGE> 13
INTEREST EXPENSE
- ----------------
Interest expense at $336,391 was $55,467 higher than in the corresponding
quarter of 1998. The increase resulted from higher borrowing costs in Canada
($110,541), which were incurred primarily to finance the 1998 acquisitions,
partially offset by a reduction of $55,074 in the United States in interest on
the loan from Congress Financial Corporation, which is to be repaid from the
proceeds of sale of the Wyant Health Care Division.
OTHER INCOME
- ------------
Other income increased to $23,106 from $6,084 in the second quarter of 1998.
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
- -----------------------------------------------------
Income from continuing operations before income taxes amounted to $338,847, a
reduction of $342,609 from the amount of $681,456 earned in the second quarter
of 1998. The sanitation products segment decreased by $460,325, while the
wiping products segment improved by $46,734 and corporate expenses were $70,982
lower than in the second quarter of 1998.
INCOME TAXES
- ------------
Income tax expense at $156,000 was $142,800 lower than in the second quarter
last year, reflecting the reduced level of pre-tax income in the current
quarter.
DISCONTINUED OPERATIONS
- -----------------------
The discontinued health care operations generated after-tax income from
operations of $567,353 or $0.16 per common share in the second quarter, compared
with $348,141 or $0.10 per common share in the second quarter of 1998. The
improved results were due to a 10.3% increase in sales revenue and higher
margins, at 23.2% of sales compared with 20.5% of sales in the second quarter
last year, partially offset by an increase of $166,253 or 12.3% in operating
expenses. These included $83,725 of higher outward freight costs to support the
increased sales volume.
NET INCOME
- ----------
Net income for the second quarter of 1999 amounted to $750,200, or $0.18 per
common share after deducting dividends and accretion relating to the mandatorily
redeemable preferred shares, compared with net income of $730,797 or $0.18 per
common share in the second quarter of 1998.
SIX MONTHS ENDED JUNE 30, 1999 COMPARED WITH THE SIX MONTHS ENDED JUNE 30, 1998
SALES
- -----
Sales of continuing operations for the first half of 1999 at $38,826,298 were
$7,413,487 or 23.6% higher than in the first half of 1998, after eliminating
inter-segment sales of $2,157,028 in the current period and $2,120,355 in the
same period last year. Sales of the sanitation products segment were
$31,989,737 in the current period, an increase of $6,636,872 or 26.2% over the
sales of $25,352,865 in the corresponding period last year. The increase
reflected the added sales revenue from the businesses acquired in the second
quarter of 1998 and the increase of $2,208,317 or 107.2% in direct sales of
paper products from the Company's paper converting operation. Sales of the
wiping products segment increased by $813,288 or 9.9% to $8,993,589 in the first
half of 1999, as a result of higher sales of wipers and paper products.
13
<PAGE> 14
COST OF SALES AND GROSS PROFIT
- ------------------------------
Gross profit of the sanitation products segment declined to 36.9% of sales in
the first half of 1999 from 39.1% of sales in the same period in 1998,
reflecting primarily lower selling prices for paper products. In the wiping
products segment, gross profit was 18.0% of sales, up from 17.2% of sales in the
first half of 1998, primarily due to higher margins on sales of paper products.
SELLING EXPENSES
- ----------------
Selling expenses for the six months ended June 30, 1999 amounted to $7,571,700,
an increase of $1,561,070 or 26.0% over the same period last year. In the
sanitation products segment, selling expenses increased by $1,402,618 or 28.2%
to $6,369,263, due to the added expenses of the businesses acquired in the
second quarter of 1998 and additional costs of approximately $270,000 incurred
as a result of challenges associated with the implementation of new information
systems, partially offset by the favorable impact of the weaker Canadian dollar
translation rate in the current period. In the wiping products segment, selling
expenses were $1,202,437, an increase of $158,452 or 15.2% over the same period
last year, resulting primarily from higher outward freight and staffing costs.
GENERAL AND ADMINISTRATION EXPENSES
- -----------------------------------
General and administration expenses increased by $861,696 or 23.2% to $4,571,687
in the first half of 1999. Expenses of the sanitation products segment at
$4,180,988 were $850,514 or 25.5% higher than in the first half of 1998, as the
added expenses of the businesses acquired in the second quarter of 1998 and
costs of approximately $133,000 incurred as a result of the implementation of
new information systems and the reorganization of the national logistics group
more than offset the favorable impact of the weaker Canadian dollar translation
rate in 1999. Expenses of the wiping products segment were $264,940, an
increase of $33,423 or 14.4% over the first half of 1998 primarily as a result
of higher staffing costs. Corporate charges in the first half of 1999 at
$125,759 were $22,241 lower than in the corresponding period last year due to a
reduction in professional fees.
AMORTIZATION
- ------------
Amortization in the first six months of 1999 amounted to $291,180, an increase
of $89,668 over the same period last year. The increase resulted primarily from
the additional amortization from the businesses acquired in 1998, together with
the amortization of goodwill resulting from their acquisition.
INTEREST EXPENSE
- ----------------
Interest expense increased by $116,738 to $646,276 in the first half of 1999.
The increase resulted from higher borrowing costs of $209,799 in Canada which
were incurred primarily to finance the 1998 acquisitions, partially offset by a
reduction of $93,061 in interest costs in the United States on the loan from
Congress Financial Corporation.
OTHER INCOME
- ------------
Other income increased to $149,549 in the first half of 1999 from $85,679 in the
corresponding period last year. The increase was primarily due to a higher
amount of cash discounts taken.
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
- -----------------------------------------------------
Income from continuing operations before income taxes amounted to $512,678,
compared with $960,974 in the first half of 1998. The sanitation products
segment decreased by $590,545 and the wiping products segment was $14,235 lower,
while corporate expenses were $156,484 lower than in the first half of 1998.
INCOME TAXES
- ------------
Income tax expense on continuing operations amounted to $247,000 in the first
half of 1999, a decrease of $176,400 from the same period last year, due to the
lower pre-tax income in the current period.
14
<PAGE> 15
DISCONTINUED OPERATIONS
- -----------------------
After-tax income from the discontinued health care operations amounted to
$974,053 or $0.27 per common share in the first half of 1999, up from $703,197
or $0.20 per common share in the same period in 1998.
The improvement resulted primarily from a 7.7% increase in sales revenue and
higher margins, at 22.4% of sales compared with 20.3% of sales in the first half
of 1998. These were partially offset by an increase of $341,677 or 12.7% in
operating expenses, including $171,661 of higher outward freight costs related
primarily to the increased level of sales.
NET INCOME
- ----------
Net income for the first half of 1999 was $1,239,731, or $0.29 per common share
after deducting dividends and accretion on the mandatorily redeemable preferred
shares, compared with $1,240,771 or $0.30 per common share in the corresponding
period last year.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
Liquidity and capital resources of the Company's Canadian operations (Wood
Wyant) and United States operations (IFC Disposables) are discussed separately,
as each is self-financing and has separate banking facilities.
CANADIAN OPERATIONS
- -------------------
Cash utilized during the first quarter of 1999 amounted to $3,792,580. Operating
activities utilized $1,449,758, due to an increase in non-cash working capital
of $2,347,945 which resulted from an increase in receivables of $3,367,907,
partially offset by higher payables ($471,901) and income taxes payable
($150,455), together with lower inventories ($268,129) and prepaid expenses
($129,477). The increase in receivables was due to a higher level of sales
activity in June 1999, poorer collection performance due in part to problems
associated with the implementation of new applications software and a stronger
Canadian dollar translation rate in June 1999 compared with December 1998. The
higher payables also reflected the increased business activity in June 1999 and
the stronger Canadian dollar translation rate, partially offset by the effect of
a new contract for paper purchases which provides less favorable payment terms.
Capital expenditures in the first half of 1999 amounted to $2,225,851. This was
primarily for the purchase of the new applications software and related
hardware, which was financed for the most part by a five-year term bank loan of
Cdn. $2,500,000 ($1,708,817). Expenditures for the purchase of businesses
amounted to $1,053,625 in the first half of 1999. Repayments of long-term debt
during the period totalled $657,019. In addition, $513,204 of outstanding Class
A Preferred shares of Wood Wyant were redeemed in January 1999 and dividends of
$84,380 were paid in the first half of 1999 on the outstanding Class A and Class
B Preferred shares.
The Company's secured revolving line of credit was increased from Cdn.
$7,500,000 to Cdn. $9,500,000 on March 10, 1999 to meet increased working
capital requirements, and to Cdn. $10,500,000 ($7,177,033) on June 22, 1999. The
latter increase, together with a bridge loan of Cdn. $850,000 ($580,998), were
obtained to finance the purchase of businesses and are repayable by July 31,
1999. At June 30, 1999, approximately $900,000 was available under the secured
revolving line of credit and an additional amount of approximately $675,000 was
available to finance future capital expenditures under a revolving credit
facility of Cdn. $3,000,000 ($2,050,581).
All borrowings of the Canadian Operations are with the Bank of Nova Scotia.
Long-term debt outstanding at June 30, 1999 amounted to $6,225,460, including
$1,454,094 due within one year. All of the loans were at the commercial prime
rate in Canada (6.25% at June 30, 1999) plus 0.75%. The secured revolving line
of credit bears interest at the prime rate in Canada. Under the terms of the
loan agreements, covenants exist which require Wood Wyant to meet certain ratios
relating to debt to tangible net worth, current assets to current liabilities
and cash flow to debt service, as well as maintaining a minimum level of
tangible net worth. Also, borrowings under the revolving credit facility must
not exceed a given proportion of accounts receivable. The Company was in
compliance with all of the covenants at June 30, 1999.
15
<PAGE> 16
CANADIAN OPERATIONS (CONT'D)
- ----------------------------
The Company has no commitments for material capital expenditures and has no
plans for major capital expenditures for existing businesses during the next
five years. Payments on long-term debt obligations existing at June 30, 1999
average less than $1,000,000 annually over the next five years, with a maximum
of $1,536,000 in 2000.
Amounts required to redeem Class A and Class B Preferred shares approximate
$540,000 per annum during that period, while redemption of the Class F Preferred
shares in the event that the option to redeem is exercised by the holders of
those shares would require an additional annual amount of approximately $435,000
for five years commencing in 2000.
Management believes that future operating cash flows and the unused balance
available under existing credit facilities will be sufficient to meet its
ongoing operating cash requirements, to repay the term debt and redeem the
Preferred shares as they become due and to meet cash requirements for capital
asset additions.
U.S. OPERATIONS
- ---------------
Continuing operations in the United States utilized $410,358 of cash during the
six months ended June 30, 1999. Working capital increased by $607,726,
primarily due to increases in receivables ($567,760) and inventories ($428,515),
partially offset by an increase of $376,972 in income taxes payable. Capital
expenditures amounted to $343,263 during the first half of 1999. A total of
$655,542 was drawn on the committed revolving credit facility with Congress
Financial Corporation during the period.
Borrowings of the U.S. Operations consist of a committed revolving credit
facility of $13,000,000 with Congress Financial Corporation which bears interest
at commercial prime rate plus 1% (prime at June 30, 1999 was 7.75%). Unused
availability was approximately $3,200,000 at June 30, 1999. Maximum borrowing
under the facility is determined by certain advance formulas applicable to the
level of accounts receivable and inventories and the value of property, plant
and equipment, net of guarantees.
Management believes that future operating cash flows and the unused balance
available under the existing credit facility will be sufficient to enable the
Company to meet its ongoing operating cash requirements and to finance capital
asset additions until the sale of the Wyant Health Care Division. Thereafter,
following the repayment of the balance outstanding under the secured line of
credit with Congress Financial Corporation, management believes that future
operating cash flows and excess cash on hand will be sufficient to meet
operating cash requirements and to finance capital asset additions.
DISCONTINUED OPERATIONS
- -----------------------
On February 23, 1999, the Board of Directors approved the sale of the Company's
Wyant Health Care Division, subject to completion of buyer financing, customary
regulatory approvals and the approval of the Company's shareholders, for cash on
closing of $11,500,000 and $550,000 which will be held in escrow for twenty-four
months. These cash proceeds are subject to adjustment on closing, which took
place on July 21, 1999. Results of operations between the measurement date of
December 17, 1998 and the closing date are expected to contribute positively to
the Company's overall results.
16
<PAGE> 17
DISCONTINUED OPERATIONS (CONT'D)
- --------------------------------
Cash received on closing will be utilized to pay off the balance under the
secured line of credit with Congress Financial Corporation ($4,894,262 as at
June 30, 1999), and to pay the withdrawal liability and income taxes generated
by the transaction. The Company is in the process of evaluating possible
alternative uses of the balance of the net cash proceeds from the sale,
including the acquisition of assets or businesses in North America that are
consistent with its overall strategy of growing as a North American janitorial
and sanitation products manufacturer and distributor. Although the Company is
evaluating several opportunities, currently, there are no significant
acquisitions of assets or businesses that would be considered probable. To the
extent that it acquires any such assets or businesses, whether related to its
overall strategy or otherwise, there can be no assurance that such acquisitions
will be successfully integrated with its operations or that such acquisitions
will ultimately be profitable for the Company. Pending the application of such
proceeds, the Company intends to use such proceeds to repay certain short-term
debt of its subsidiaries.
Following completion of the sale, the Company will cease the manufacture of
adult incontinent products and the sale of the Division is not expected to
materially affect the operations of the Company's other operating units as each
is autonomous and separately managed. The Company will be precluded from
re-entering the adult incontinent products business for a period of five years
following the sale.
The Division supplies airlaid non-woven fabric and incontinent products to IFC
which will be subject to a three-year supply agreement upon completion of the
sale. IFC will supply PaperPak with Quickable(TM) absorbent washcloths at an
agreed upon price, which will be renegotiated every twelve months, and at a
volume which will be predetermined.
SIGNIFICANT FACTORS AND KNOWN TRENDS WITH REGARD TO DISCONTINUED OPERATIONS
PENSION PLAN
- ------------
Certain employees of the Wyant Health Care Division are members of a
multi-employer defined benefit Pension Plan (the "Plan" or "Pension Plan"). The
Company was informed by the Pension Plan administrators that the Plan had failed
to meet minimum legal funding requirements and that the Company's pro-rata share
of the minimum funding deficiency was $370,000. The Plan has applied to the IRS
for a waiver from the minimum funding requirements and awaits a response. If
the waiver is obtained, the employers contributing to the Plan would be required
to fund and charge to earnings the funding deficiency, and corresponding
interest charges, over a 15 year period. If the waiver is not obtained, an
excise tax may be imposed on the Plan and such excise tax could be as much as
100% of the funding deficiency.
The sale of the Wyant Health Care Division will trigger a withdrawal liability
as PaperPak, the acquirer of the Division, will not assume the Company's
obligation under the Plan. This withdrawal liability will be funded through the
proceeds from the sale of the Division. In addition to the withdrawal
liability, the Plan may also seek to collect the Division's pro-rata share of
the funding deficiency discussed above.
ENVIRONMENTAL
- -------------
The Company has been participating with the New Jersey Department of
Environmental Protection ("DEP") in the investigation and potential clean-up of
the Company's former site of operation located at 5 and 6 Easy Street,
Bridgewater, New Jersey. As a tenant, the Company is potentially responsible to
the DEP for environmental contamination based solely upon it having been a
tenant at the site where there is contamination. Similarly, the Company is
potentially jointly and severally liable with the landlord for both the
investigation and clean-up costs. To date, the investigation has established
that, in addition to on-site contamination, some of the contamination on the
site is or has come from off site. The Company disputes it caused any such
contamination and maintains that on-site contamination was a result of prior
tenants' acts.
17
<PAGE> 18
ENVIRONMENTAL (CONT'D)
- ----------------------
Nevertheless, the Company has fully cooperated with the DEP and has presently
been directed by the DEP to delineate the ground water contaminant plume, which
may result in establishing that the contamination is a regional problem rather
than one specific to the former site that the Company leased. The Company has
entered into a flat fee contract with its environmental consultants for $11,750
for the delineation investigation. Upon determination of the contaminant plume,
the Company will petition the DEP for a classification exception area where the
remedial action will be natural attenuation.
After the investigation is completed, the DEP could require clean-up or
remediation of the contamination on site, the cost of which could potentially be
in the range of $100,000 to $150,000. However, present technology is such that
no remedial action plan could bring the site in conformity with the present DEP
regulations, regardless of the funds spent.
The Company is unaware of any other environmental or similar matters that would
have a material effect on the capital expenditures, earnings or competitive
position of the Company.
BACKLOG, IMPACT OF INFLATION, SEASONALITY
- -----------------------------------------
The Company attempts to maintain sufficient inventory levels for all products to
allow shipment against most orders for wiping products within a one week period
and next day for core stocking items of the Company's sanitation products. To
some extent, however, certain components must be inventoried further in advance
of actual orders to ensure availability. For the most part, purchases are based
upon quarterly requirements as projected after calculating sales indications
from the sales and marketing departments.
The Company's products are not subject to significant seasonal influences.
Because its products are sold primarily to distributors throughout the United
States and to distributors and end-users in Canada, the Company is affected by
general economic conditions. Accordingly, any adverse change in the economic
climate may have an adverse impact on the Company's sales and financial
condition.
YEAR 2000
- ---------
The Year 2000 problem arises because many computer systems and software products
currently in use are coded to accept only two digit entries in the date code
field. Four digit entries will be required to identify 21st century dates.
Consequently, the use of software and computer systems that are not Year 2000
compliant could result in the disruption of operations. As a result, many
companies' computer systems and software may need to be upgraded or replaced to
conform with Year 2000 requirements.
In order to properly address the Year 2000 Issue, the Company has appointed the
Vice President, Information Technology of Wood Wyant as Year 2000 Project
Director to direct a project team which will coordinate the implementation of a
Year 2000 Plan by identifying Year 2000 issues and coordinating solutions. The
project team has been assembled and is conducting Year 2000 readiness assessment
audits at all of the Company's facilities, encompassing all equipment and
processes deemed important to the facility's operation.
Wood Wyant has installed new applications software for which it has obtained
written confirmation from the vendor that it is Year 2000 compliant. This
software became operational in the first quarter of 1999. The software
currently in use at IFC is not Year 2000 compliant and will be replaced by
hardware and applications software which will be Year 2000 compliant by the end
of the third quarter of 1999. As an additional precaution, the technical
infrastructure of all the Company's businesses will be audited and tested to
ensure Year 2000 compliance under normal business conditions.
18
<PAGE> 19
YEAR 2000 (CONT'D)
- ------------------
The total cost of purchasing and installing the new Wood Wyant software is
estimated to be $2,222,000 (Cdn. $3,250,000), and is being financed primarily
through a five-year term loan with the Bank of Nova Scotia. The cost to replace
computer hardware and applications software at IFC is estimated to be $75,000.
The Company has requested confirmation of suppliers' readiness and follow-up
discussions will take place for all business-critical suppliers. Major
customers are being contacted to confirm their Year 2000 readiness.
To date, the Company has not incurred significant incremental costs in order to
comply with Year 2000 requirements and does not believe it will incur
significant incremental costs in the foreseeable future. However, there can be
no assurance that Year 2000 errors or defects will not be discovered in the
Company's software systems and, if errors or defects are discovered, there is no
assurance that this would not result in a material financial risk to the
Company.
In addition, the Company purchases goods and services from third party vendors
that may not be Year 2000 compliant. While the Company intends to obtain
confirmation of vendors' state of readiness during the third quarter of 1999,
their failure to operate properly with regard to Year 2000 requirements could
require the Company to incur material expenses to rectify the impact on the
Company of such failure. However, all of the Company's raw materials are widely
available and the Company is not dependent on any one supplier or group of
suppliers.
The Company does not know the state of preparedness for Year 2000 issues of all
of its customers. However, no single customer exceeds 2% of consolidated sales
and therefore the risk the Company faces is broad based if many customers are
unable to use information systems necessary to place orders for Company
products.
The Company's Year 2000 Issue involves significant risks. There can be no
assurance that the Company will succeed in implementing its Year 2000 Plan. The
following describes the Company's most reasonably likely worst-case scenario,
given current uncertainties.
If the Company's replaced internal information technology systems fail the
Company will experience significant difficulties in supplying customers and such
a failure could hamper the Company's ability to manage the orderly replenishment
of inventories.
If the Company's vendors or suppliers of its required power, telecommunications,
transportation and financial services, fail to provide the Company with products
and services, it will be unable to provide services to its customers.
If any of these uncertainties were to occur, the Company's business, financial
condition and results of operations would be adversely affected. The Company is
unable to assess the likelihood of such events occurring or the extent of the
effect on the Company.
Although the Company has not yet developed a comprehensive contingency plan to
address situations that may result if the Company or any of the third parties
upon which the Company is dependent is unable to achieve Year 2000 readiness,
the Company's Year 2000 compliance program is ongoing and its ultimate scope, as
well as the consideration of contingency plans, will continue to be evaluated as
new information becomes available.
The Company plans to achieve Year 2000 compliance by the end of the third
quarter of 1999.
19
<PAGE> 20
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company is subject to market risk principally in two areas, interest rate
risk and foreign currency exchange rate risk.
INTEREST RATE RISK
- ------------------
The Company's lines of credit and long-term debt are all at rates of interest
which fluctuate with changes to bank prime rates in either the United States or
Canada. Consequently, increases in interest rates could have an adverse effect
on the Company's future results.
FOREIGN CURRENCY EXCHANGE RATE RISK
- -----------------------------------
The Company's results of operations are significantly dependent on, and
materially affected by, the results of operations of Wood Wyant and the
attendant business risks that are associated with the operation of Wood Wyant
as a going concern. These material risks include the following:
- A significant portion of the Company's earnings, on a consolidated basis,
will come from Wood Wyant, a Canadian corporation. As a result, the
Company's results of operations and earnings may be adversely affected by
the fluctuation in the currency exchange rate between US and Canadian
dollars.
- Since Wood Wyant conducts its business using Canadian dollars as its
operational currency, to the extent the Canadian dollar strengthens
against the US dollar, United States competitors in the institutional
sanitation business may become more active in the Canadian market. As a
result, the Company's results of operations and earnings may be adversely
affected in light of potential greater competition in times of a stronger
Canadian dollar.
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
The Company is not involved in any material legal proceedings.
ITEMS 2, 3, 4 & 5
Not applicable
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
a) Not applicable
b) Reports on Form 8-K
A current report on Form 8-K, dated April 1, 1999, was filed on April 8,
1999, reporting information under Item 5, Other Events.
20
<PAGE> 21
WYANT CORPORATION
SIGNATURES
Pursuant to the requirement 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.
Wyant Corporation
(Registrant)
Date: August 12, 1999 SIGNATURE: /s/ Marc D'Amour
------------------ ----------------------
Marc D'Amour
Vice President,
Chief Financial Officer
and Treasurer
(For the registrant and as
Principal Financial Officer)
21
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM WYANT
CORPORATION FORM 10-Q RE QUARTER-ENDED JUNE 30, 1999 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FORM 10-Q FOR QUARTER-ENDED JUNE 30, 1999.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 82,941
<SECURITIES> 0
<RECEIVABLES> 14,501,287
<ALLOWANCES> 0
<INVENTORY> 8,842,826
<CURRENT-ASSETS> 33,979,402
<PP&E> 10,813,372
<DEPRECIATION> 0
<TOTAL-ASSETS> 49,959,554
<CURRENT-LIABILITIES> 24,115,299
<BONDS> 4,771,366
5,305,677
0
<COMMON> 27,053
<OTHER-SE> 13,949,711
<TOTAL-LIABILITY-AND-EQUITY> 49,959,554
<SALES> 38,826,298
<TOTAL-REVENUES> 38,826,298
<CGS> 25,382,323
<TOTAL-COSTS> 37,816,890
<OTHER-EXPENSES> (149,546)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 646,276
<INCOME-PRETAX> 512,678
<INCOME-TAX> 247,000
<INCOME-CONTINUING> 265,678
<DISCONTINUED> 974,053
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,239,731
<EPS-BASIC> 0.02
<EPS-DILUTED> 0.02
</TABLE>
