<PAGE>
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
[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
[_] 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 0-5286
KEWAUNEE SCIENTIFIC CORPORATION
-------------------------------
(Exact name of registrant as specified in its charter)
Delaware 38-0715562
- ------------------------------ --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2700 West Front Street
Statesville, North Carolina 28677
- ------------------------------ --------------------
(Address of principal executive offices) (Zip Code)
(704) 873-7202
------------------------------
(Registrant's telephone number, including area code)
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 February 28, 1997, the Registrant had outstanding 2,365,921 shares of
Common Stock.
Pages: This report, including exhibits, contains 16 pages numbered sequentially
from this cover page.
<PAGE>
KEWAUNEE SCIENTIFIC CORPORATION
INDEX TO FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED January 31, 1997
Page
Number
------
PART I. FINANCIAL INFORMATION
- ------------------------------
Item 1. Financial Statements
Condensed Statements of Operations -
Three and nine months ended January 31, 1997 and 1996 3
Condensed Balance Sheets - January 31, 1997 4
and April 30, 1996
Condensed Statements of Cash Flows -
Nine months ended January 31, 1997 and 1996 5
Notes to Condensed Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial 8
Condition and Results of Operations
Review by Independent Accountants 13
Independent Accountants' Review Report 14
PART II. OTHER INFORMATION
- ---------------------------
Item 6. Exhibits and Reports on Form 8-K 15
SIGNATURE
- --------- 16
2
<PAGE>
Part 1. Financial Information
Item 1. Financial Statements
Kewaunee Scientific Corporation
Condensed Statements of Income
(Unaudited)
Three months ended Nine months ended
January 31 January 31
------------------ -----------------
1997 1996 1997 1996
-------- -------- ------- --------
($ in thousands, except per share data)
Net sales $14,837 $12,719 $47,045 $43,652
Cost of products sold 11,353 10,291 36,532 35,555
------- ------- ------- -------
Gross profit 3,484 2,428 10,513 8,097
Operating expenses 2,918 2,377 8,756 7,472
------- ------- ------- -------
Operating profit 566 51 1,757 625
Interest expense (68) (155) (311) (550)
Other income, net 12 191 31 230
------- ------- ------- -------
Income before income taxes 510 87 1,477 305
Income tax benefit (35) - (365) -
------- ------- ------- -------
Net income $545 $87 $1,842 $305
======= ======= ======= =======
Per share data:
Net income per common share $0.23 $0.04 $0.78 $0.13
Average number of common shares
outstanding (in thousands) 2,366 2,367 2,366 2,367
See accompanying notes to condensed financial statements.
3
<PAGE>
Kewaunee Scientific Corporation
Condensed Balance Sheets
($ in thousands)
January 31 April 30
1997 1996
---------- --------
(Unaudited)
Assets
- ------
Current assets:
Cash $6 $16
Receivables 12,299 13,212
Inventories 2,698 1,213
Prepaid expenses and
other current assets 1,283 1,205
------- -------
Total current assets 16,286 15,646
------- -------
Property, plant and equipment, at cost 27,040 25,840
Accumulated depreciation (16,709) (15,532)
------- -------
Net property, plant and equipment 10,331 10,308
------- -------
Other assets 529 550
------- -------
$27,146 $26,504
======= =======
Liabilities and Stockholders' Equity
- ------------------------------------
Current liabilities:
Short-term borrowings $1,147 $2,320
Current portion of long-term debt 180 180
Accounts payable 4,560 4,505
Other current liabilities 3,956 3,594
------- -------
Total current liabilities 9,843 10,599
------- -------
Long-term debt 287 328
------- -------
Deferred income taxes and other
non-current liabilities 758 1,062
------- -------
Stockholders' equity:
Common stock 6,550 6,550
Additional paid-in capital 116 116
Retained earnings 11,108 9,361
Common stock in treasury, at cost (1,516) (1,512)
------- -------
Total stockholders' equity 16,258 14,515
------- -------
$27,146 $26,504
======= =======
See accompanying notes to condensed financial statements.
4
<PAGE>
Kewaunee Scientific Corporation
Condensed Statements of Cash Flows
(Unaudited)
Nine months ended
January 31,
-------------------
1997 1996
-------- --------
($ in thousands)
Cash flows from operating activities
Net income $1,842 $305
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 1,269 1,213
Provision for bad debts 194 45
Decrease in receivables 719 2,311
Increase in inventories (1,485) (819)
Increase (decrease) in accounts payable
and other current liabilities 417 (1,676)
Other, net (365) (183)
------- ------
Net cash provided by operating activities 2,591 1,196
------- ------
Cash flows from investing activities
Capital expenditures (1,292) (478)
Decrease in short-term investments - 350
------- ------
Net cash used in investing activities (1,292) (128)
------- ------
Cash flows from financing activities
Net decrease in short-term borrowings (1,173) (996)
Repayment of long-term debt (41) (105)
Dividends paid (95) -
------- ------
Net cash used in financing activities (1,309) (1,101)
------- ------
Decrease in cash and cash equivalents (10) (33)
Cash and cash equivalents, beginning of period 16 58
------- ------
Cash and cash equivalents, end of period $6 $25
======= ======
Supplemental disclosure of cash flow information
Interest paid $275 $471
Income tax paid $12 $4
Supplemental disclosure of non-cash financing
activities
Equipment acquired under financing arrangements - $338
See accompanying notes to condensed financial statements.
5
<PAGE>
Kewaunee Scientific Corporation
Notes to Condensed Financial Statements
(unaudited)
A. Financial Information
- -------------------------
The unaudited interim condensed financial statements of Kewaunee Scientific
Corporation (the "Company" or "Kewaunee") have been prepared pursuant to the
rules and regulations of the Securities and Exchange Commission (the
"Commission"). Accordingly, certain information and footnote disclosures
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted. These interim
condensed financial statements should be read in conjunction with the financial
statements and notes included in the Company's 1996 Annual Report to
Stockholders.
In the opinion of management, the interim condensed financial statements reflect
all adjustments (consisting only of normal recurring adjustments) necessary for
a fair presentation of the interim periods. The results of operations for the
interim periods are not necessarily indicative of the results of operations to
be expected for the full year.
B. Inventories
- ---------------
Inventories consisted of the following (in thousands):
January 31, 1997 April 30, 1996
---------------- --------------
Finished products $ 580 $ 253
Work-in-process 742 280
Raw materials 1,376 680
------ ------
$2,698 $1,213
====== ======
C. Balance Sheet
- -----------------
The Company's April 30, 1996 condensed balance sheet as presented herein is
derived from audited financial statements, but does not include all disclosures
required by generally accepted accounting principles.
6
<PAGE>
D. Financing Arrangements
- --------------------------
In September 1996, the Company amended and renewed its revolving credit
facility. The facility allows the company to borrow up to the lesser of $8.5
million or the amount available under certain eligibility formulas using
qualifying receivables and inventories, as defined under the credit arrangement.
Under the facility, the Company makes monthly interest payments at a rate of the
greater of 6% or the lender's prime rate (8.25% at January 31, 1997), calculated
on the average loan balance outstanding during each month. The Company's
receivables and inventories continue to be pledged to the lender as collateral
securing borrowings under the facility, but other collateral has been released.
The facility extends through January 7, 1999.
7
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
The Company's 1996 Annual Report to Stockholders contains management's
discussion and analysis of financial condition and results of operations at and
for the year ended April 30, 1996. The following discussion and analysis
describes material changes in the Company's financial condition since April 30,
1996. The analysis of results of operations compares the three months and nine
months ended January 31, 1997 with the comparable periods of the prior fiscal
year.
Results of Operations
- ---------------------
The Company recorded sales of $14.8 million for the three months ended January
31, 1997, up 16.7% from sales of $12.7 million for the comparable period of
the prior year. Sales for the nine months ended January 31, 1997 were $47.0
million, up 7.8% from sales of $43.7 million in the comparable period of the
prior year. The sales increases for the three months and nine months ended
January 31, 1997 were primarily attributable to increased sales of end user
products, partially offset by decreased sales of contract-bid laboratory
furniture.
The Company's gross profit margins for the three months and nine months ended
January 31, 1997 were 23.5% and 22.3%, respectively, compared with 19.1% and
18.5% for the comparable periods of the prior fiscal year. Current year gross
profit margins were favorably affected by an improved product sales mix, higher
selling prices, and lower manufacturing costs.
Operating expenses for the three months and nine months ended January 31, 1997
were $2.9 million and $8.8 million, or 19.7% and 18.6% of sales, respectively.
This compares to operating expenses of $2.4 million and $7.5 million, or 18.7%
and 17.1% of sales, respectively, for the comparable periods of the prior fiscal
year. The increases in operating expenses for the three months and nine months
ended January 31, 1997 were primarily attributable to increased sales and
marketing expenses and expenses associated with incentive compensation programs.
8
<PAGE>
Operating profits of $566,000 and $1,757,000 were recorded for the three months
and nine months ended January 31, 1997. This compares to operating profits of
$51,000 and $625,000, respectively, for the comparable periods of the prior
fiscal year.
Other income was $12,000 and $31,000 for the three months and nine months ended
January 31, 1997, respectively, compared to other income of $191,000 and
$230,000 for the comparable periods of the prior fiscal year. Other income for
each of the prior year periods included $180,000 of life insurance proceeds
received in connection with one of the Company's employee benefit plans.
Interest expense was $68,000 and $311,000 for the three months and nine months
ended January 31, 1997, respectively, compared to interest expense of $155,000
and $550,000 for the comparable periods of the prior fiscal year. The decreases
in interest expense for the current year resulted from lower levels of debt
under the Company's revolving credit facility, assisted by lower interest rates
paid.
Income tax benefits of $35,000 and $365,000, respectively, resulting from
reductions to the Company's valuation allowance on deferred tax assets, were
recorded for the three months and nine months ended January 31, 1997. At
January 31, 1997, the Company's valuation allowance on deferred tax assets was
substantially eliminated, and as a result, income in future periods is expected
to result in a more normal income tax expense. No income tax expense or
benefit was recorded for the three and nine months ended January 31, 1996. The
effective tax rate for each of these periods differs from the related statutory
rates due to adjustments to the deferred tax valuation allowance.
Net income for the three months ended January 31, 1997 was $545,000, or 23
cents per share, including an income tax benefit of $35,000. Net income for the
nine months ended January 31, 1997 was $1.8 million, or 78 cents per share,
including income tax benefits of $365,000. This compares to net income of
$87,000 and $305,000, or 4 cents per share and 13 cents per share, respectively,
for the comparable periods of the prior fiscal year.
9
<PAGE>
Liquidity and Capital Resources
- --------------------------------
Historically, the Company's principal sources of liquidity have been funds
generated from operations, supplemented as needed by short-term borrowings. The
Company believes that these sources will be sufficient to support ongoing
business levels.
The Company had working capital of $6.4 million on January 31, 1997, as compared
to $5.0 million at April 30, 1996. The ratio of current assets to current
liabilities was 1.7-to-1 at January 31, 1997 as compared to 1.5-to-1 at April
30, 1996. The debt-to-equity ratio was .10-to-1 at January 31, 1997, as
compared to .19-to-1 at April 30, 1996. The Company had unused credit available
under a revolving credit facility of $6.9 million at January 31, 1997, as
compared to unused credit available under this facility of $4.0 million at April
30, 1996.
The Company's operations provided cash of $2.6 million during the nine months
ended January 31, 1997, primarily from operating income and a decrease
in customer receivables, partially offset by an increase in inventory. The
Company's operations generated cash of $1.2 million during the nine months ended
January 31, 1996, primarily from operating earnings and a decrease in customer
receivables, offset by decreases in accounts payable and other accrued
liabilities.
In September 1996, the Company amended and renewed its revolving credit
facility. The facility allows the Company to borrow up to the lesser of $8.5
million or the amount available under certain eligibility formulas using
qualifying receivables and inventories, as defined under the credit arrangement.
Under the facility, the Company makes monthly interest payments at a rate of the
greater of 6% or the lender's prime rate, calculated on the average loan balance
outstanding during each month. The Company's receivables and inventories
continue to be pledged to the lender as collateral securing borrowings under the
facility, but the other collateral has been released.
10
<PAGE>
The Company used cash of $1.3 million for capital expenditures during the nine
months ended January 31, 1997, and used cash of $478,000 for such expenditures
during the comparable period of the prior fiscal year, in both instances
primarily for the purchase of production machinery. The Company does not
anticipate an abnormal level of capital expenditures for the remainder of the
current fiscal year.
The Company decreased its short-term borrowings by $1.2 million and $1.0 million
during the nine months ended January 31, 1997, and January 31, 1996,
respectively, using cash provided by operating activities. The Company used
cash of $41,000 for scheduled principal payments on long-term debt during the
nine months ended January 31, 1997. The Company used cash of $105,000 for
principal payments on long-term debt during the nine months ended January 31,
1996.
Cash dividends of $95,000 were paid on the Company's common stock during the
three months and nine months ended January 31, 1997. No cash dividends were
paid during the three months and nine months ended January 31, 1996.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
- --------------------------------------------------------------------------------
Certain information included in the Liquidity and Capital Resources section
contains forward-looking statements and involves risks and uncertainties that
could significantly impact the results of operations of the Company. These
factors include, but are not limited to, general economic, competitive,
governmental, and technological factors affecting the Company's operations,
markets, products, services, and prices.
11
<PAGE>
Recent Accounting Standards
- ---------------------------
In October 1995, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards (SFAS) No. 123, "Accounting for Stock-Based
Compensation," which was effective for the Company beginning May 1, 1996. SFAS
No. 123 requires expanded disclosure of stock-based compensation arrangements
with employees and encourages (but does not require) compensation cost to be
measured based on the fair value of the equity instrument awarded. Companies are
permitted, however, to continue to apply APB Opinion No. 25, which recognizes
compensation cost based on the intrinsic value of the equity instrument
awarded. The Company will continue to apply APB Opinion No. 25 to its stock-
based compensation awards to employees and will disclose the required pro forma
effect in net income and earnings per share in its year-end financial
statements.
12
<PAGE>
REVIEW BY INDEPENDENT ACCOUNTANTS
A review of the interim financial information included in this Quarterly Report
on Form 10-Q for the three months and nine months ended January 31, 1997 has
been performed by Deloitte & Touche LLP, the Company's independent accountants.
Their report on the interim financial information follows. There have been no
adjustments or disclosures proposed by Deloitte & Touche LLP which have not been
reflected in the interim financial information.
13
<PAGE>
[DELOITTE & TOUCHE LLP LETTERHEAD]
INDEPENDENT ACCOUNTANTS' REPORT
To the Board of Directors and Stockholders of
Kewaunee Scientific Corporation
Statesville, North Carolina
We have reviewed the accompanying condensed balance sheet of Kewaunee Scientific
Corporation (the Company) as of January 31, 1997, and the related condensed
statements of operations for the three-month and nine-month periods ended
January 31, 1997 and 1996 and the condensed statements of cash flows for the
nine-month periods ended January 31, 1997 and 1996. These financial statements
are the responsibility of the Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and of making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to such condensed financial statements for them to be in conformity with
generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the balance sheet of Kewaunee Scientific Corporation as of April 30,
1996, and the related statements of operations and retained earnings and of cash
flows for the year then ended (not presented herein); and in our report dated
May 31, 1996, we expressed an unqualified opinion on those financial statements.
In our opinion, the information set forth in the accompanying condensed balance
sheet as of April 30, 1996 is fairly stated, in all material respects, in
relation to the balance sheet from which it has been derived.
/s/ Deloitte & Touche LLP
February 13, 1997
14
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
10.1 Amendment dated September 26, 1996 to the Financing and
Security Agreements dated January 6, 1995 between The CIT
Group/Business Credit, Inc. and the Registrant.
27.1 Financial Data Schedule
(b) Reports on Form 8-K
No reports on Form 8-K were filed with the Commission during the
three months ended January 31, 1997.
15
<PAGE>
KEWAUNEE SCIENTIFIC CORPORATION
2700 WEST FRONT STREET
STATESVILLE, NC 28677
September 26, 1996
The CIT Group/Business Credit, Inc.
P.O. Box 30337
Charlotte, NC 28231
Gentlemen:
We refer to the Accounts Receivable Financing Agreement between us dated
January 6, 1995, as amended (herein the "Agreement"). Capitalized terms not
otherwise defined herein shall have the meanings assigned to them in the
Agreement.
Pursuant to mutual understanding, the Agreement is hereby amended as of the
date hereof as follows:
1. Paragraph 1.8 of Section I of the Agreement is hereby amended in its
entirety to read as follows:
"1.8 "Chase Rate" shall mean the per annum rate of interest publicly
announced by The Chase Manhattan Bank in New York, New York, from time to
time as its prime rate. (The prime rate is not intended to be the lowest
rate of interest charged by The Chase Manhattan Bank to its borrowers.)"
2. The first two sentences of Paragraph 3.1 of Section III of the
Agreement are hereby deleted in their entirety and the following is substituted
in lieu thereof:
"You will make revolving credit advances to us, at your discretion, in
amounts up to the sum of (a) eighty-five (85%) of the amount of our Net
Amount of Eligible Receivables, plus (b) fifty percent (50%) of the value
of our Eligible Inventory consisting solely of raw materials calculated on
the basis of the lower of cost or market, with cost calculated on a first
in first out basis. In no event shall advances against such Eligible
Inventory exceed $2,000,000 nor shall the aggregate revolving credit
advances and letters of credit issued or guaranteed in accordance with
Section 3.2 exceed $8,500,000 from time to time outstanding."
<PAGE>
3. The amount "$1,500,000" in Paragraph 3.2 of Section III of the
Agreement is hereby deleted and the amount "$500,000" is hereby substituted in
lieu thereof.
4. Paragraph 3.4 of Section III of the Agreement is hereby amended in its
entirety to read as follows:
"Interest shall be payable by us upon the average of the actual daily loan
balance outstanding during each calendar month at a rate (computed on the
basis of the actual number of days elapsed over a year of 360 days) equal
to the Chase Rate but in no event less than 6.00% per annum. Any change in
the rate of interest hereunder due to a change in the Chase Rate shall take
effect on the day such change in the Chase Rate becomes effective. Interest
shall be charged on: all advances, all charges hereunder, and any debit
balance in our account. You shall be entitled to charge our account at the
rate provided for herein until all Obligations have been paid and satisfied
in full. All such interest shall be due and payable on the first day of
each month in arrears and shall be charged by you to our account and shall
be included in each monthly statement of our account. Such interest shall
be deemed paid by the first amounts subsequently credited to our account."
5. The first sentence of Paragraph 3.5 of Section III of the Agreement is
hereby deleted and the following is substituted in lieu thereof:
"The actual out-of-pocket expenses you incur will be charged by you and
paid by us for each periodic examination of our facilities."
6. Paragraph 3.6 of Section III of the Agreement is hereby amended in its
entirety to read as follows:
"A Letter of Credit Fee equal to the amount of one percent (1.00%) of the
face amount of each Letter of Credit opened will be charged by you and paid
by us on the date of issuance thereof. A Letter of Credit Fee equal to the
amount of one percent (1%) shall also be charged by you and paid by us on
the face amount of each existing Letter of Credit amended or otherwise
modified on the date of such amendment or modification."
7. Paragraph 3.7 of Section III of the Agreement is hereby amended in its
entirety to reach as follows:
"A facility fee equal to $10,000 shall be deemed payable by us to you on
January 6, 1997 and a facility fee equal to $5,000 shall be deemed payable
by us to you on January 6, 1998."
<PAGE>
8. The seventh sentence of Paragraph 5.1 of Section V of the Agreement is
hereby amended by deleting the phrase "(3) Business Days" therefrom and
substituting "(1) Business Day" in lieu thereof.
9. The first sentence of Paragraph 9.1 of Section IX is hereby deleted and
the following is substituted in lieu thereof:
"This Agreement shall become effective upon acceptance by you and shall
continue in full force and effect until four (4) years from the date of
such acceptance (the "Initial Term"), and from year to year thereafter,
unless sooner terminated as herein provided."
10. Clause (ii) of the second sentence of Paragraph 9.1 of Section IX of
the Agreement is hereby deleted and the following is substituted in lieu
thereof:
"(ii) during the second and third years of the Initial Term, a termination
charge in an amount equal to one percent (1%) of the Maximum Credit
Facility and (iii) during the fourth year of the Initial Term, a
termination charge in an amount equal to one-half of one percent (1/2 of
1%) of the Maximum Credit Facility."
In addition, pursuant to mutual understanding, it is hereby agreed that
effective as of the date hereof, i) the Security Agreement (Equipment and
Machinery), dated January 6, 1995, as amended, is terminated and you shall
release your lien upon the Collateral (as defined therein) thereunder; ii) the
Trademark and Service Mark Security Agreement, dated October 6, 1995, is
terminated and you shall release your lien upon the Trademarks (as defined
therein) thereunder; iii) the Deed of Trust and Security Agreement, dated
January 6, 1995, recorded in Iredell County, North Carolina, is hereby
terminated and you shall release your lien on the collateral thereunder; and iv)
the Deed of Trust and Security Agreement, dated January 6, 1995, recorded in
Caldwell County, Texas, is hereby terminated and you shall release your lien on
the collateral thereunder. You hereby agree to promptly execute and deliver to
us any and all appropriate UCC terminations and/or other releases to evidence
your release of said liens and you hereby confirm and agree that, from time to
time hereafter, upon our reasonable request, you will execute and deliver such
additional similar lien releases as may be necessary to effectively terminate
any and all of your liens and/or security interests on the assets and properties
described in clauses (i) through (iv) of this paragraph on any public record.
Except as otherwise herein specifically provided, no other change in, or
amendment of, any other terms or provisions of the Agreement is intended or
implied.
<PAGE>
If the foregoing is in accordance with your understanding, please so
indicate by signing and returning the enclosed copy of this letter.
Very truly yours,
KEWAUNEE SCIENTIFIC CORPORATION
By: /s/ D.M. Parker
------------------------------------
Title: V.P. Finance/CFO
Read and Agreed to:
THE CIT GROUP/BUSINESS CREDIT, INC.
By: /s/ C. Tom Helms
------------------------------
Title: Vice President
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> APR-30-1997
<PERIOD-START> MAY-01-1996
<PERIOD-END> JAN-31-1997
<CASH> 6
<SECURITIES> 0
<RECEIVABLES> 12,299
<ALLOWANCES> 0
<INVENTORY> 2,698
<CURRENT-ASSETS> 16,286
<PP&E> 27,040
<DEPRECIATION> 16,709
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<CURRENT-LIABILITIES> 9,843
<BONDS> 287
<COMMON> 6,550
0
0
<OTHER-SE> 9,708
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<SALES> 47,045
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<CGS> 36,532
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<OTHER-EXPENSES> 8,756
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<INCOME-TAX> (365)
<INCOME-CONTINUING> 1,842
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