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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 October 31, 1996 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 1-4615
--------
HOWELL INDUSTRIES, INC.
- ------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
MICHIGAN 38-0479830
- ------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
17515 West Nine Mile Road, Suite 650, Southfield, Michigan 48075
- ------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (810) 424-8220
-------------------------
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 _______
Number of shares of common stock outstanding at October 31, 1996: 622,738
(1)
<PAGE>
Part I - Financial Information
<TABLE>
<CAPTION>
HOWELL INDUSTRIES, INC.
(A Michigan Corporation)
SOUTHFIELD, MICHIGAN
CONSOLIDATED BALANCE SHEETS
ASSETS
October 31, 1996 July 31, 1996
(Unaudited) (Note)
---------------- -------------
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 3,589,085 $ 4,660,050
Accounts receivable, net 11,020,275 5,855,052
Cost of unbilled dies 395,982 708,486
Inventories (last in-first out):
Raw materials 1,150,788 1,737,051
Work in process 1,785,104 2,417,602
Finished goods 3,482,375 3,594,653
----------- -----------
Total inventories 6,418,267 7,749,306
Prepaid expenses 826,729 1,472,434
Deferred tax asset - current 59,000 59,000
----------- -----------
TOTAL CURRENT ASSETS 22,309,338 20,504,328
PROPERTY, PLANT AND EQUIPMENT-(At cost, 8,151,580 7,769,521
less accumulated depreciation of ----------- -----------
$15,544,002 and $15,180,642 at
10/31/96 and 7/31/96 respectively)
TOTAL $30,460,918 $28,273,849
=========== ===========
<FN>
Note: The balance sheet at July 31, 1996 has been taken from the audited
financial statements at that date, and condensed.
</TABLE>
(2)
<PAGE>
<TABLE>
<CAPTION>
HOWELL INDUSTRIES, INC.
(A Michigan Corporation)
SOUTHFIELD, MICHIGAN
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' INVESTMENT
October 31, 1996 July 31, 1996
(Unaudited) (Note)
---------------- -------------
<S> <C> <C>
CURRENT LIABILITIES:
Accounts payable $ 5,637,779 $ 5,620,751
Accrued expenses 3,749,623 2,357,956
Taxes on income 323,054 41,420
Restructuring costs 46,118 46,118
----------- -----------
TOTAL CURRENT LIABILITIES 9,756,574 8,066,245
OTHER (Includes restructuring costs
of $119,599.) 1,072,654 1,123,152
DEFERRED FEDERAL TAXES ON INCOME 124,000 124,000
SHAREHOLDERS' INVESTMENT:
Common stock, no par value:
Authorized 2,500,000 shares,
issued and outstanding,
622,738 shares at 10/31/96
and at 7/31/96. 593,584 593,584
Retained earnings 18,914,106 18,366,868
----------- -----------
TOTAL SHAREHOLDERS' INVESTMENT 19,507,690 18,960,452
----------- -----------
TOTAL $30,460,918 $28,273,849
----- =========== ===========
<FN>
Note: The balance sheet at July 31, 1996 has been taken from the audited
financial statements at that date, and condensed.
</TABLE>
(3)
<PAGE>
<TABLE>
<CAPTION>
HOWELL INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF RETAINED EARNINGS
For The For The
Three Months Ended Year Ended
October 31, 1996 July 31, 1996
(Unaudited) (Audited)
------------------ -------------
<S> <C> <C>
Balance, beginning $18,366,868 $18,514,815
Add:
Net profit for the period 702,922 474,791
----------- -----------
19,069,790 18,989,606
Deduct:
Cash dividend 155,684 622,738
----------- -----------
Balance, ending $18,914,106 $18,366,868
=========== ===========
</TABLE>
(4)
<PAGE>
<TABLE>
<CAPTION>
HOWELL INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF NET EARNINGS (UNAUDITED)
For the Three Months Ended
October 31, 1996 October 31, 1995
---------------- ----------------
<S> <C> <C>
Net Sales $ 25,196,745 $ 16,660,990
Cost of Goods Sold 22,902,282 15,252,109
Selling, General and
Administrative Expenses 1,287,100 1,057,568
------------- ------------
Income From Operations 1,007,363 351,313
Other Income (Expense)
Net Other Income 68,559 118,884
------------- ------------
Earnings Before Income
Taxes 1,075,922 470,197
Taxes on Income 373,000 159,000
------------- ------------
Net Earnings $ 702,922 $ 311,197
============= ============
Earnings Per Share 1.13 .50
Average Number of Shares
Outstanding During the
Period 622,738 622,738
Dividends Per Share .25 .25
<FN>
The unaudited consolidated financial statements of Howell Industries, Inc. for
the three months ended October 31, 1996 and 1995 reflect all adjustments which
are, in the opinion of management, necessary to a fair statement of the
results of operations for the interim periods. The operating results for the
three months ended October 31 are not necessarily indicative of results of
operations for an entire year.
</TABLE>
(5)
<PAGE>
<TABLE>
<CAPTION>
HOWELL INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
For the Three For the Three
Months Ended Months Ended
October 31, 1996 October 31, 1995
---------------- ----------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Earnings $ 702,922 $ 311,197
Adjustments to reconcile net earnings
to net cash provided by operating
activities:
Depreciation and amortization 384,810 377,130
Other - reserves (50,498) (36,725)
Change in operating assets and liabilities:
Accounts receivable (5,165,223) 706,967
Cost of unbilled dies 312,504 (352,046)
Inventories 1,331,039 (632,054)
Prepaid expenses 645,705 250,600
Accounts payable and accrued expenses 1,408,693 1,001,463
Taxes on income 281,634 153,526
Restructuring costs -0- (903)
----------- -----------
NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES (148,414) 1,779,155
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of equipment 7,182 -0-
Capital expenditures (774,049) (278,200)
----------- -----------
NET CASH PROCEEDS FROM (USED IN)
INVESTING ACTIVITIES (766,867) (278,200)
CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends paid (155,684) (155,684)
----------- -----------
NET CASH PROCEEDS FROM (USED IN)
FINANCING ACTIVITIES: (155,684) (155,684)
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS (1,070,965) 1,345,271
CASH AND CASH EQUIVALENTS AT BEGINNING OF
PERIOD 4,660,050 2,979,374
----------- -----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 3,589,085 $ 4,324,645
=========== ===========
</TABLE>
(6)
<PAGE>
HOWELL INDUSTRIES, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
The increase in earnings for the fiscal quarter ended October 31, 1996 as
compared to the quarter ended October 31, 1995 was primarily attributable to
higher sales. The higher sales were generated mainly by parts supplied for
production of a new vehicle line.
The increase in net earnings for the quarter ended October 31, 1996 as
compared to the quarter ended July 31, 1996 was primarily attributable to
higher sales and lower manufacturing overhead.
GENERAL
The increase in accounts receivable was due to increased sales by the Company
in October 1996.
On November 12, 1996 the Company announced that it had retained the investment
firm of Roney & Co. to explore the possible sale or merger of the Company.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
No Form 8-K was filed during the quarter.
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 duly authorized.
HOWELL INDUSTRIES, INC.
---------------------------------------
(Registrant)
By: /s/Morton Schiff
---------------------------------
Morton Schiff
President and Principal Financial
Officer
Date: December 3, 1996
----------------
(7)
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUL-31-1997
<PERIOD-END> OCT-31-1996
<CASH> $ 3,589,085
<SECURITIES> 0
<RECEIVABLES> 11,020,275
<ALLOWANCES> 0
<INVENTORY> 6,418,267
<CURRENT-ASSETS> 22,309,338
<PP&E> 23,695,582
<DEPRECIATION> 15,544,002
<TOTAL-ASSETS> 30,460,918
<CURRENT-LIABILITIES> 9,756,574
<BONDS> 0
<COMMON> 593,584
0
0
<OTHER-SE> 18,914,106
<TOTAL-LIABILITY-AND-EQUITY> 30,460,918
<SALES> 25,196,745
<TOTAL-REVENUES> 25,265,304
<CGS> 22,902,282
<TOTAL-COSTS> 24,189,382
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 1,075,922
<INCOME-TAX> 373,000
<INCOME-CONTINUING> 702,922
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 702,922
<EPS-PRIMARY> 1.13
<EPS-DILUTED> 0.00
</TABLE>
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