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 January 31, 1997 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
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (810) 424-8220
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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 January 31, 1997:
622,738
(1)
<PAGE>
Part I - Financial Information
<TABLE>
<CAPTION>
Item 1. Financial Statements.
HOWELL INDUSTRIES, INC.
(A Michigan Corporation)
SOUTHFIELD, MICHIGAN
CONSOLIDATED BALANCE SHEETS
ASSETS
January 31, 1997 July 31, 1996
---------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 3,986,911 $ 4,660,050
Accounts receivable, net 9,557,847 5,855,052
Cost of unbilled dies 808,243 708,486
Inventories (last in-first out):
Raw materials 1,570,651 1,737,051
Work in process 1,792,904 2,417,602
Finished goods 2,433,179 3,594,653
----------- -----------
Total inventories 5,796,734 7,749,306
Prepaid expenses 991,903 1,472,434
Deferred tax asset - current 59,000 59,000
----------- -----------
TOTAL CURRENT ASSETS 21,200,638 20,504,328
PROPERTY, PLANT AND EQUIPMENT-(At cost, 8,527,686 7,769,521
less accumulated depreciation of ----------- -----------
$15,842,485 and $15,180,642 at
1/31/97 and 7/31/96 respectively)
TOTAL $29,728,324 $28,273,849
=========== ===========
</TABLE>
(2)
<PAGE>
<TABLE>
<CAPTION>
HOWELL INDUSTRIES, INC.
(A Michigan Corporation)
SOUTHFIELD, MICHIGAN
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' INVESTMENT
January 31, 1997 July 31, 1996
---------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C>
CURRENT LIABILITIES:
Accounts payable $ 5,908,601 $ 5,620,751
Accrued expenses 3,944,129 2,357,956
Taxes on income (314,946) 41,420
Restructuring costs 46,118 46,118
------------ ------------
TOTAL CURRENT LIABILITIES 9,583,902 8,066,245
OTHER (Includes restructuring costs
of $119,599.) 526,547 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 1/31/97
and at 7/31/96 593,584 593,584
Retained earnings 18,900,291 18,366,868
------------ ------------
TOTAL SHAREHOLDERS' INVESTMENT 19,493,875 18,960,452
------------ ------------
TOTAL $ 29,728,324 $ 28,273,849
============ ============
</TABLE>
(3)
<PAGE>
<TABLE>
<CAPTION>
HOWELL INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF RETAINED EARNINGS
For The For The
Six Months Ended Year Ended
January 31, 1997 July 31, 1996
---------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C>
Balance, beginning $18,366,868 $18,514,815
Add:
Net profit for the period 844,792 474,791
----------- -----------
19,211,660 18,989,606
Deduct:
Cash dividend 311,369 622,738
----------- -----------
Balance, ending $18,900,291 $18,366,868
=========== ===========
</TABLE>
(4)
<PAGE>
<TABLE>
<CAPTION>
HOWELL INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF NET EARNINGS (UNAUDITED)
For the Six Months For the Three Months
Ended Ended
January 31, January 31, January 31, January 31,
1997 1996 1997 1996
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net Sales $48,088,528 $34,154,827 $22,891,783 $17,493,837
Cost of Goods Sold 44,489,505 31,287,600 21,587,223 16,035,491
Selling, General and
Administrative Expenses 2,489,359 2,289,125 1,202,259 1,231,557
----------- ----------- ----------- -----------
Income From Operations 1,109,664 578,102 102,301 226,789
Other Income (Expense)
Net Other Income 190,128 355,566 121,569 236,682
----------- ----------- ----------- -----------
Earnings Before Income
Taxes 1,299,792 933,668 223,870 463,471
Taxes on Income 455,000 321,000 82,000 162,000
----------- ----------- ----------- -----------
Net Earnings $ 844,792 $ 612,668 $ 141,870 $ 301,471
=========== =========== =========== ===========
Earnings Per Share $ 1.36 $ .98 $ .23 $ .48
=========== =========== =========== ===========
Average Number of Shares
Outstanding During the
Period 622,738 622,738 622,738 622,738
Dividends Per Share .50 .50 .25 .25
<FN>
The unaudited consolidated financial statements of Howell Industries, Inc.
for the six months ended January 31, 1997 and 1996 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
six months ended January 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 Six For the Six
Months Ended Months Ended
January 31, 1997 January 31, 1996
---------------- ----------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Earning $ 844,792 $ 612,668
Adjustments to reconcile net earnings to
net cash provided by operating
activities:
Depreciation and amortization 769,620 754,260
Other - reserves (596,605) (144,037)
Change in operating assets and liabilities:
Accounts receivable (3,702,795) (1,279,041)
Cost of unbilled dies (99,757) (1,275,776)
Inventories 1,952,572 (1,190,923)
Prepaid expenses 480,531 190,244
Accounts payable and accrued expenses 1,874,023 2,413,201
Taxes on income (356,366) 5,527
Restructuring costs -0- (1,737)
----------- -----------
NET CASH PROVIDED BY (USED IN) 1,166,015 84,386
OPERATING ACTIVITIES
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale or purchases of -0- 850,066
marketable securities
Proceeds from sale of equipment 46,137 68,566
Capital expenditures (1,573,922) (869,650)
----------- -----------
NET CASH PROCEEDS FROM (USED IN)
INVESTING ACTIVITIES (1,527,785) 48,982
CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends paid (311,369) (311,369)
----------- -----------
NET CASH PROCEEDS FROM (USED IN)
FINANCING ACTIVITIES: (311,369) (311,369)
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS (673,139) (178,001)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 4,660,050 2,979,374
----------- -----------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 3,986,911 $ 2,801,373
=========== ===========
</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 six months ended January 31, 1997 as
compared to the six months ended January 31, 1996 was primarily attributable
to higher sales. The higher sales were generated mainly by parts supplied for
production of a new vehicle line which progressively increased in sales over
a six-month period.
The decrease in net earnings for the quarter ended January 31, 1997 as
compared to the quarters ended January 31, 1996 and October 31, 1996 was
primarily attributable to higher manufacturing overhead in the Masury, Ohio
plant and lower other income.
GENERAL
The increase in accounts receivable was due to increased sales by the Company
in January, 1997.
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 1. Legal Proceedings.
There have been no changes in the legal proceedings of the Company regarding
the environmental matters disclosed in the 1996 financial statements.
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: February 28, 1997
(7)
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUL-31-1997
<PERIOD-END> JAN-31-1997
<CASH> 3,986,911
<SECURITIES> 0
<RECEIVABLES> 9,557,847
<ALLOWANCES> 0
<INVENTORY> 5,796,734
<CURRENT-ASSETS> 21,200,638
<PP&E> 24,370,171
<DEPRECIATION> 15,842,485
<TOTAL-ASSETS> 29,728,324
<CURRENT-LIABILITIES> 9,583,902
<BONDS> 0
<COMMON> 593,584
0
0
<OTHER-SE> 18,900,291
<TOTAL-LIABILITY-AND-EQUITY> 29,728,324
<SALES> 48,088,528
<TOTAL-REVENUES> 48,278,656
<CGS> 44,489,505
<TOTAL-COSTS> 46,978,864
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 152
<INCOME-PRETAX> 1,299,792
<INCOME-TAX> 455,000
<INCOME-CONTINUING> 844,792
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 844,792
<EPS-PRIMARY> 1.36
<EPS-DILUTED> 0.00
</TABLE>
