<PAGE>
UNITED STATES
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 period ended September 30, 1997
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[ ] 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: 0-4036
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Kreisler Manufacturing Corporation
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(Exact name of registrant as specified in its charter)
Delaware 22-1044792
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(State of other jurisdiction of (I.R.S. employer
incorporation or organization) Identification No.)
5960 Central Avenue, Suite H., St. Petersburg, Florida 33707
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(Address of principal executive offices)
(813) 347-1144
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(Registrant's telephone number, including area code)
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(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
requirements for the past 90 days.
[X] Yes [ ] No
Number of shares of Common Stock outstanding as of September 30, 1997, was
485,512 shares.
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Kreisler Manufacturing Corporation and Subsidiaries
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
(Unaudited) (Audited)
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First Quarter Ended Year Ended
9/30/97 6/30/97
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<S> <C> <C>
Assets
Cash and cash equivalents $1,053,327 $ 691,916
Accounts receivable - trade 1,391,174 1,609,913
Inventories
Raw Materials 1,291,491 1,232,044
Work in process 550,783 528,880
Finished goods 56,978 61,646
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1,899,252 1,822,570
Deferred tax asset 400,000 300,000
Other current assets 19,129 22,987
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Total current assets 4,762,882 4,447,386
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Certificates of deposit 562,059 554,934
Property, plant & equip., at cost, less accum.deprec 223,455 197,246
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$5,548,396 $5,199,566
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Liabilities and Stockholders' Equity
Accounts payable - trade $ 644,284 $ 552,959
Accrued expenses 87,905 174,216
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Total current liabilities 732,189 727,175
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Stockholders' Equity
Common Stock, $.50 par value - 3,000,000 shares authorized
485,512 shares issued and outstanding for 1997 & 1996 242,756 242,756
Additional paid-in capital 1,571,703 1,571,703
Retained earnings 3,001,748 2,657,932
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Total Stockholders' Equity 4,816,207 4,472,391
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$5,548,396 $5,199,566
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</TABLE>
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Kreisler Manufacturing Corporation and Subsidiaries
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
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Three Months Ended September 30 1997 1996
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Sales $2,392,533 $1,830,841
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Cost of goods sold 2,100,307 1,747,598
General and administrative expenses 68,913 64,652
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2,169,220 1,812,250
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Earnings (loss) from operations 223,313 18,591
Other income:
Interest and other earnings 20,503 6,044
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Earnings (loss) before taxes 243,816 24,635
Income tax benefit 100,000 --
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Net earnings (loss) $ 343,816 $ 24,635
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Earnings per share:
Net earnings (loss) $ .71 $ .05
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Kreisler Manufacturing Corporation and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
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Three Months Ended September 30 1997 1996
<S> <C> <C>
Cash flows from operating activities:
Net Earnings (loss) $ 343,816 $ 24,635
Adjustments to reconcile net loss to cash (used) provided by operating
activities:
Depreciation and amortization 11,732 14,894
Gain on sale of assets -- --
Decrease (increase) in accounts receivable - trade 218,739 (77,180)
Decrease (increase) in inventories (76,682) --
Decrease (increase) in deferred tax benefit (100,000) --
Decrease (increase) in other current assets 3,858 3,430
Increase (decrease) in accounts payable - trade 91,325 (29,406)
Increase (decrease) in accrued expenses (86,311) (76,730)
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Net adjustments 62,661 (164,992)
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Net cash provided (used) by operations 406,477 (140,357)
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Cash flows from investing activities:
Purchase of investments (7,125) (39)
Proceeds from sale of investments -- 300,000
Purchase of property and equipment (37,941) --
Proceeds from sale of equipment -- --
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Net cash used in investing activities (45,066) 299,961
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Net increase (decrease) in cash and cash equivalents 361,411 159,604
Cash and cash equivalents at beginning of year 691,916 587,063
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Cash and cash equivalents at September 30 $ 1,053,327 $ 746,667
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</TABLE>
<PAGE>
Kreisler Manufacturing Corporation and Subsidiaries
MANAGEMENT'S DISCUSSION AND ANALYSIS
Net sales increased in the first quarter of fiscal year 1998 $890,000
or 59% as compared to the first quarter of 1997. Demand for aircraft components
remains high and delivery schedules have short lead time. Our backlog remains
approximately the same as that of June 30, 1997. Compared to the same period in
the prior year, our backlog has increased approximately 60%.
Net earnings for the first quarter of fiscal year 1998, including
deferred tax benefit of $100,000, was $344,000 or 14.4%. Without the tax
benefit, net earnings were $223,000 or 9.3% compared to the same period in the
prior year of $25,000 or 1.4%. Increased sales and controlled expenses
contributed to the improvement of earnings per share to $.71 per share with the
tax benefit, or $.50 per share without the benefit, compared with $.05 per share
for the same period in the prior year.
On August 5, 1997, and September 29, 1997, the Board of Directors
approved, respectively, the proposal for a Stock Option Plan and a four for one
split of common stock. Both plans are to be voted on by shareholders at our
Annual Meeting on November 25, 1997.
Short term liquidity, management believes, will be adequately provided
by profitability and/or cash reserves to meet the needs of the business. For the
quarter, net cash provided by operations was $407,000 including $100,000
deferred tax benefit. Compared to the same period in the prior year, cash
provided was a negative $140,000. Cash flow from investing activities was
$45,000, with $38,000 the purchase of equipment. Net increase in cash and
equivalents was $361,000. Our balance sheet remains strong with a 7:1 current
ratio, a quick asset ratio (cash and receivables) of 3:1, $4,593,000 working
capital and no long term debt.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
KREISLER MANUFACTURING CORPORATION
(Registrant)
By /s/ Edward L. Stern
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Edward L. Stern
President, Treasurer
October 17, 1997
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FOR IMMEDIATE RELEASE
CONTACT: EDWARD L. STERN
PRESIDENT
KREISLER MANUFACTURING CORPORATION
FIRST QUARTER 1997 - 1998
Net earnings of Kreisler Manufacturing Corporation was $.71 per share of common
stock in the first quarter of 1997 compared to $.05 per share in the first
quarter of 1996. Highlights are as follows (in thousands, except for per share
amounts):
Three Months Ended September 30 (Unaudited)
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1997 1996
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Sales $2,393 $1,831
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Earnings before income taxes 244 25
Income tax benefit 100 --
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Net earnings 344 25
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Net earnings per share of common stock $ .71 $ .05
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Consolidated Balance Sheets
(in thousands) (Unaudited) 9/30/97 6/30/97
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Assets
Cash, cash equivalents and investments $1,054 $ 692
Accounts receivable 1,391 1,610
Inventories 1,899 1,823
Deferred tax asset 400 300
Other current assets 19 23
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Total current assets 4,763 4,448
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Certificates of deposit 562 555
Property and equipment-at cost, less depreciation 223 197
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$5,548 $5,200
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Liabilities and Common Stockholders' Equity
Accounts payable $ 644 $ 553
Accrued expenses 88 174
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Total current liabilities $ 732 $ 727
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Total stockholders' equity $4,816 $4,472
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$5,548 $5,200
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Stockholders' equity is $9.92 per share in the first quarter of 1997 compared to
$9.21 as of June 30, 1997.
On September 29, 1997, the Board of Directors approved a four for one split
proposal of Kreisler common stock to meet new NASDAQ public float requirements.
At the Annual Meeting on November 25, 1997, shareholders will vote on this
proposal.
Kreisler Manufacturing Corporation (OTC-KRSL) fabricates metal component parts
and assemblies for both military and commercial aircraft engines including
manifold assemblies, impingement tubes and blade locks.
R102197
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 1,053,327
<SECURITIES> 0
<RECEIVABLES> 1,391,174
<ALLOWANCES> 0
<INVENTORY> 1,899,252
<CURRENT-ASSETS> 4,762,882
<PP&E> 2,959,768
<DEPRECIATION> 2,736,313
<TOTAL-ASSETS> 5,548,396
<CURRENT-LIABILITIES> 732,189
<BONDS> 0
<COMMON> 242,756
0
0
<OTHER-SE> 4,573,451
<TOTAL-LIABILITY-AND-EQUITY> 5,548,396
<SALES> 2,392,533
<TOTAL-REVENUES> 2,392,533
<CGS> 2,169,220
<TOTAL-COSTS> 2,169,220
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 243,816
<INCOME-TAX> (100,000)
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 343,816
<EPS-PRIMARY> 0.71
<EPS-DILUTED> 0.00
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