<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
QUARTERLY REPORT UNDER SECTION 13 or 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended August 31, 1998
Commission File Number 0-3183
LeaRonal, Inc.
(Exact name of registrant as specified in its charter)
New York 11-1717548
(State or other jurisdiction of (IRS Employer
Incorporation or organization) Identification No.)
272 Buffalo Avenue, Freeport, New York 11520
(Address of principal executive offices)
(516) 868-8800
(Registrant's telephone number, including area code)
(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.
Yes X No
As of October 9, 1998, 12,534,757 shares of the registrant's Common Stock, $1
par value, were outstanding.
<PAGE> 2
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
INDEX
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements
Condensed Consolidated Balance Sheets at
August 31, 1998 (Unaudited) and February 28, 1998 3
Condensed Consolidated Statements of Income for the
Three Months and Six Months Ended August 31, 1998 and 1997
(Unaudited) 4
Condensed Consolidated Statements of Cash Flows for the Six Months
Ended August 31, 1998 and 1997 (Unaudited) 5
Notes to Condensed Consolidated Financial Statements (Unaudited) 7
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 11
PART II. OTHER INFORMATION:
Item 4. Submission of Matters to a Vote of Security Holders 14
Item 6. Exhibits and Reports on Form 8-K 14
Signatures 15
</TABLE>
- 2 -
<PAGE> 3
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
Aug. 31, 1998 Feb.28, 1998
------------- ------------
(Unaudited) (Note)
<S> <C> <C>
ASSETS (in thousands)
Current Assets:
Cash and cash equivalents $ 26,635 $ 19,653
Investments available-for-sale 2,709 2,734
Investments held-to-maturity 7,660 8,871
Receivables, less allowances 46,092 52,228
Inventories 26,858 28,406
Deferred tax assets 1,424 1,468
Other current assets 3,609 2,233
--------- ---------
TOTAL CURRENT ASSETS 114,987 115,593
Investments in unconsolidated affiliates 8,698 9,207
Property, plant and equipment 74,322 69,749
Less accumulated depreciation (32,583) (29,257)
--------- ---------
41,739 40,492
Patents at cost, less amortization 620 585
Other assets 5,681 5,163
--------- ---------
TOTAL ASSETS $ 171,725 $ 171,040
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable $ 4,570 $ 557
Accounts payable 14,899 16,538
Accrued expenses and other liabilities 10,427 11,181
Income taxes 6,903 8,221
Current portion of long-term debt 722 741
--------- ---------
TOTAL CURRENT LIABILITIES 37,521 37,238
Long-term debt, less current portion 2,037 2,422
Deferred tax liabilities 2,474 2,464
Minority interests 7,568 6,984
Stockholders' Equity:
Common stock, par value $1 per share - authorized 35,000,000 shares, issued
14,042,201 shares including 1,511,716 shares at August 31, 1998 and
1,318,151 shares at February 28, 1998 held in treasury 14,042 14,042
Additional paid-in capital 5,479 5,230
Retained earnings 121,861 116,420
Unrealized holding gains on investments 417 548
Cost of common stock in treasury (23,243) (17,581)
Cumulative translation adjustment 3,569 3,273
--------- ---------
TOTAL STOCKHOLDERS' EQUITY 122,125 121,932
--------- ---------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 171,725 $ 171,040
========= =========
</TABLE>
Note: The balance sheet at February 28, 1998 has been taken from the audited
financial statements at that date, and condensed. See notes to
condensed consolidated financial statements (unaudited).
<PAGE> 4
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended Three Months Ended
August 31 August 31
----------------------- ------------------------
1998 1997 1998 1997
-------- -------- -------- --------
(in thousands - except share data)
<S> <C> <C> <C> <C>
Net sales $114,226 $121,134 $ 55,270 $ 61,393
Interest income 744 637 411 290
Other income - net 1,112 911 357 188
-------- -------- -------- --------
116,082 122,682 56,038 61,871
Costs and expenses:
Cost of sales 78,950 87,802 37,573 44,932
Selling, general and administrative 21,552 19,064 10,932 9,530
Research and development 2,112 1,842 1,007 906
Interest expense 278 285 174 149
Minority interests 852 904 418 385
-------- -------- -------- --------
Total costs and expenses 103,744 109,897 50,104 55,902
-------- -------- -------- --------
Income before income taxes 12,338 12,785 5,934 5,969
Income taxes 3,371 3,829 1,625 1,792
-------- -------- -------- --------
NET INCOME $ 8,967 $ 8,956 $ 4,309 $ 4,177
======== ======== ======== ========
Net income per share $ .71 $ .70 $ .34 $ .33
======== ======== ======== ========
Net income per share - assuming dilution $ .69 $ .69 $ .34 $ .32
======== ======== ======== ========
</TABLE>
See notes to condensed consolidated financial statements (unaudited).
- 4 -
<PAGE> 5
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
August 31
--------------------------------
1998 1997
-------- --------
(in thousands)
<S> <C> <C>
OPERATING ACTIVITIES
Net income $ 8,967 $ 8,956
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 2,797 2,650
Provision for bad debts 176 418
Equity in earnings of unconsolidated
affiliates net of dividends received (195) 16
Deferred income taxes 53 (276)
Minority interests 852 904
Gain on sales of investments
available-for-sale (106) (61)
Changes in operating assets and liabilities:
Receivables 6,870 (6,961)
Inventories 1,814 (1,538)
Other current assets (1,283) (12)
Other receivables 225 (501)
Accounts payable (2,242) 3,787
Accrued expenses and other liabilities (299) 919
Income taxes payable (1,225) 1,132
Other assets (1,238) 678
-------- --------
NET CASH PROVIDED BY OPERATING ACTIVITIES 15,166 10,111
INVESTING ACTIVITIES
Purchases of property, plant and equipment (net)
and patents (3,905) (5,401)
Proceeds from sales of investments available-for-sale 241 5,735
Purchases of investments available-for-sale (237) (209)
Purchases of investments held-to-maturity (5,351) (7,511)
Redemptions of investments held-to-maturity 6,689 6,036
-------- --------
NET CASH USED IN INVESTING ACTIVITIES (2,563) (1,350)
</TABLE>
See notes to condensed consolidated financial statements (unaudited)
- 5 -
<PAGE> 6
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Continued)
<TABLE>
<CAPTION>
Six Months Ended
August 31
-------------------------
1998 1997
-------- --------
(in thousands)
<S> <C> <C>
FINANCING ACTIVITIES
Dividends paid $ (3,526) $ (3,287)
Dividends paid to minority shareholders (322) (46)
Proceeds from notes payable 4,000
Payments on debt obligations (404) (412)
Proceeds from exercise of stock options 285 339
Purchases of treasury stock (5,846) (3,854)
-------- --------
NET CASH USED IN FINANCING ACTIVITIES (5,813) (7,260)
Effect of exchange rate changes on cash and
cash equivalents 192 (331)
-------- --------
INCREASE IN CASH AND CASH EQUIVALENTS 6,982 1,170
Cash and cash equivalents at beginning of the year 19,653 18,117
-------- --------
CASH AND CASH EQUIVALENTS
AT END OF THE PERIOD $ 26,635 $ 19,287
======== ========
SUPPLEMENTAL DISCLOSURES
Cash paid during the period for:
Interest $ 278 $ 275
Income taxes 4,387 2,998
</TABLE>
See notes to condensed consolidated financial statements (unaudited)
- 6 -
<PAGE> 7
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have
been prepared by the Company in accordance with generally accepted
accounting principles for interim financial information and with the
instructions of Form 10-Q and Rule 10-01 of Regulation S-X. In the opinion
of management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position, results of
operations and cash flows at August 31, 1998 and for all periods presented
have been made.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. It is suggested that these
condensed consolidated financial statements be read in conjunction with the
consolidated financial statements and notes thereto included in the
Company's February 28, 1998 annual report to shareholders. The results of
operations for the period ended August 31, 1998 are not necessarily
indicative of the operating results for the full year.
NOTE B - EARNINGS PER SHARE
The following table sets forth the computation of basic and diluted earnings
per share. Earnings per share for the three months and six months ended
August 31 follow:
<TABLE>
<CAPTION>
Six months ended Three months ended
August 31 August 31
------------------------------ ------------------------------
1998 1997 1998 1997
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Numerator for basic and
diluted earnings per share
- net income $ 8,967,000 $ 8,956,000 $ 4,309,000 $ 4,177,000
----------- ----------- ----------- -----------
Denominator:
Denominator for basic
earnings per share
- weighted average shares 12,604,096 12,836,542 12,561,079 12,786,071
Effect of dilutive securities:
Employee stock options 331,659 192,878 287,862 255,776
----------- ----------- ----------- -----------
Denominator for diluted
earnings per share - adjusted
weighted average shares
and assumed conversions 12,935,755 13,029,420 12,848,941 13,041,847
=========== =========== =========== ===========
Net income per share $ .71 $ .70 $ .34 $ .33
=========== =========== =========== ===========
Net income per share -
assuming dilution $ .69 $ .69 $ .34 $ .32
=========== =========== =========== ===========
</TABLE>
- 7 -
<PAGE> 8
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Continued)
NOTE C - INVENTORIES
Inventories consist of the following:
<TABLE>
<CAPTION>
Aug. 31, 1998 Feb. 28, 1998
------------- -------------
<S> <C> <C>
Raw materials $ 13,301,000 $12,772,000
Finished goods 13,557,000 15,634,000
----------- -----------
$26,858,000 $28,406,000
=========== ===========
</TABLE>
Domestic gold and silver inventories as of August 31, 1998 and 1997 are carried
at the lower of cost (last-in, first out [LIFO] method) or market. All other
inventories are carried at the lower of cost (first-in, first-out [FIFO] method)
or market. If the FIFO method of accounting had been used by the Company,
domestic gold and silver inventories at August 31, 1998 and February 28, 1998
would have been $1,742,000 and $2,042,000 higher, respectively.
NOTE D - STOCKHOLDERS' EQUITY
The following information pertains to cash dividends for the six months ended
August 31. The May 1997 period has been restated for the 3 for 2 stock split
effective August 19, 1997.
<TABLE>
<CAPTION>
1998 1997
----------- -----------
<S> <C> <C>
Dividends declared May May
Dividends paid June June
Dividends declared July July
Dividends paid August August
Dividends per common share:
Quarter ended May 31 $ 0.14 $ 0.13
Quarter ended August 31 $ 0.14 $ 0.13
Number of outstanding shares on which dividend was declared:
Quarter ended May 31 12,613,557 12,812,357
Quarter ended August 31 12,575,728 12,798,602
Amount of dividends:
Quarter ended May 31 $ 1,766,000 $ 1,623,000
Quarter ended August 31 1,760,000 1,664,000
----------- -----------
$ 3,526,000 $ 3,287,000
=========== ===========
</TABLE>
- 8 -
<PAGE> 9
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Continued)
NOTE E - OTHER INCOME
Other income consists of the following:
<TABLE>
<CAPTION>
Six Months Ended Three Months Ended
August 31 August 31
------------------------------- -------------------------------
1998 1997 1998 1997
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Royalty and commission income $ 938,000 $ 931,000 $ 452,000 $ 443,000
Equity in earnings of
unconsolidated affiliates 403,000 453,000 126,000 198,000
Foreign currency losses (451,000) (693,000) (263,000) (569,000)
Investment income and other 222,000 220,000 42,000 116,000
----------- ----------- ----------- -----------
$ 1,112,000 $ 911,000 $ 357,000 $ 188,000
=========== =========== =========== ===========
</TABLE>
NOTE F - COMPREHENSIVE INCOME
On March 1, 1998, the Company adopted Financial Accounting Standards Board
Statement of Financial Accounting Standards ("SFAS") No. 130 "Reporting
Comprehensive Income." SFAS No. 130 establishes new rules for the reporting and
display of comprehensive income and its components; however, the adoption of
SFAS No. 130 had no impact on the company's net income or stockholders' equity.
SFAS No. 130 requires unrealized gains or losses on the Company's
available-for-sale securities and foreign currency translation adjustments,
which prior to adoption were reported separately in stockholders' equity, to be
included in other comprehensive income.
The components of comprehensive income, net of related tax, for the six months
and three months ended August 31 are as follows:
<TABLE>
<CAPTION>
Six Months Ended Three Months Ended
August 31 August 31
------------------------------- -------------------------------
1998 1997 1998 1997
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net income as reported $ 8,967,000 $ 8,956,000 $ 4,309,000 $ 4,177,000
Unrealized (losses) gains
on securities (131,000) 14,000 (112,000) 18,000
Foreign currency
translation adjustment 296,000 (837,000) 1,260,000 1,198,000
----------- ----------- ----------- -----------
Comprehensive income $ 9,132,000 $ 8,133,000 $ 5,457,000 $ 5,393,000
=========== =========== =========== ===========
</TABLE>
- 9 -
<PAGE> 10
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Continued)
NOTE G - IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS
In June 1997, the Financial Accounting Standards Board issued SFAS No. 131,
"Disclosures About Segments Of An Enterprise And Related Information," which is
effective for years beginning after December 15, 1997. SFAS No. 131 establishes
standards for the way that public business enterprises report information about
operating segments in annual financial statements and requires that those
enterprises report selected information about operating segments in interim
financial reports. It also establishes standards for related disclosures about
products and services, geographic areas, and major customers. Because SFAS No.
131 is not required to be applied to interim financial statements in the initial
year of adoption, the Company is not required to disclose segment information in
accordance with SFAS No. 131 until its 1999 annual report, at which time it will
restate prior years' segment disclosures to conform to SFAS No. 131. In the
Company's first quarter of fiscal 2000 report, and in subsequent quarters, it
will present the interim disclosures required by SFAS No. 131 for both fiscal
2000 and 1999.
The Company is currently evaluating what operating segments of its business
trigger the disclosure requirements under SFAS No. 131 and believes the required
disclosure will be made at the end of fiscal 1999.
- 10 -
<PAGE> 11
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Forward Looking Information
This report and other Company reports identify many factors affecting its future
business prospects including: economic conditions, currency exchange rates,
inflation, competition, new product introductions, pricing, future market demand
and customer requirements. Changes in any of these factors could have a
significant impact on future results of the Company.
Six months ended August 31, 1998 and August 31, 1997
Net sales consists of sales of proprietary and patented specialty electronic and
imaging chemicals, referred to as "process sales," the precious metal content of
its electroplating processes, and sales of other products. Process sales
increased $2,884,000 or 5% to $66,513,000 in the August 1998 period, from
$63,629,000 in the August 1997 period. Process sales increased 10% in Asia, 2%
in the United States and decreased 3% in Europe in the August 1998 period. In
the August 1997 period, process sales increased 19% from the August 1996 period,
primarily from increased process sales both in Asia and the United States. The
slower sales growth in Asia in the August 1998 period is due to a downturn in
Asian economies related to the devaluation of foreign currencies and general
economic recession which started during the second half of 1997. Additionally,
beginning during the quarter ended May 1998 and continuing through September
1998, there has been a reduction in demand for electronic components on a
worldwide basis. This environment is expected to continue for the next several
quarters. Approximately 75% of the Company's process sales are supplied to
customers for electronic applications. Precious metal content and other sales
totaled $47,713,000 in the August 1998 period, a decrease of $9,792,000 or 17%
from $57,505,000 in the August 1997 period primarily due to decreased precious
metal content sales volume in the United States and lower gold metal prices. The
average gold price per troy ounce for the August 1998 and August 1997 periods
were $295 and $338, respectively.
Cost of sales decreased $8,852,000 in the August 1998 period. The decrease was
principally due to decreased precious metal sales. The August 1998 period
reflects increased gross profits of $1,944,000 or 6%, as well as an increase in
the Company's overall gross profit percentage from 27.5% to 30.9%, principally
due to the increase in process sales, which have a higher gross margin, as a
percentage of total sales. Unit margins for certain processes for the printed
circuit industry continued to erode in the 1998 period due to the competitive
environment and pressures asserted by end use customers.
Selling, general, and administrative expenses increased $2,488,000 or 13% in the
August 1998 period. The increases occurred in all geographic regions, as the
Company has added sales and technical personnel to support new products and the
increased demand from customers for technical services. In addition, the
increase in selling, general, and administrative expenses includes approximately
$700,000 related to non-capitalizable costs associated with implementing global
information system upgrades, which are year 2000 compliant. The Company
currently believes its year 2000 implementation program will be
- 11 -
<PAGE> 12
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
completed in 1999.
Research and development expenses increased $270,000 or 15% to $2,112,000 in the
August 1998 period from $1,842,000 in the August 1997 period. The increase is
primarily due to increased personnel costs which are necessary to support
existing product lines and new product development. Expenses are expected to
continue at these levels for the remainder of the fiscal year.
The effective income tax rate decreased in the August 1998 period to 27% from
30% in the August 1997 period. This is principally due to an increase in the
percentage of earnings at the Company's foreign subsidiaries which are taxed at
lower rates than those of the Company's domestic operations.
Net income increased $11,000 in the August 1998 period, primarily due to
increased gross profits from increased process sales and lower effective income
tax rates, partially offset by increased selling, general and administrative
expenses.
At August 31, 1998, the Company had working capital of $77,466,000 and current
assets of $114,987,000 including $37,004,000 in cash, cash equivalents, and
short term investments. During the August 1998 period, the Company purchased
224,500 shares of its stock at a cost of $5,846,000. The Company believes its
existing working capital and borrowing capacity, coupled with the funds
generated from operations will be sufficient to fund its anticipated capital
expenditures, stock buyback program and cash dividend requirements in fiscal
1999. It is estimated that worldwide expenditures for software, hardware,
training, and implementation of new information systems which are year 2000
compliant will total less than $3,000,000, of which approximately 50% has been
recorded as of August 31, 1998.
- 12 -
<PAGE> 13
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
Three months ended August 31, 1998 and August 31, 1997
Net sales decreased $6,123,000 or 10% from $61,393,000 in the August 1997
quarter to $55,270,000 in the August 1997 quarter. Process sales increased
$1,269,000 or 4% to $32,875,000 in the August 1998 quarter, from $31,606,000 in
the August 1997 quarter. Increases occurred in Asia and the United States, while
process sales in Europe decreased. Precious metal content and other sales
totaled $22,395,000 in the August 1998 quarter, a decrease of $7,392,000 or 25%
from $29,787,000 in the August 1997 quarter primarily due to decreased precious
metal content sales volume in the United States and lower gold metal prices. The
average gold price per troy ounce for the August 1998 and August 1997 quarters
were $290 and $330, respectively.
Cost of sales decreased $7,359,000 in the August 1998 quarter. The decrease was
principally due to decreased precious metal sales. The August 1998 quarter
reflects increased gross profits of $1,236,000 or 8%, as well as an increase in
the Company's overall gross profit percentage from 26.8% to 32.0%, principally
due to the increase in process sales, which have a higher gross margin, as a
percentage of total sales.
Selling, general, and administrative expenses increased $1,402,000 or 15% in the
August 1998 quarter. The increases occurred in all regions and reflects the cost
of additional sales and technical personnel and the cost of implementing
information system upgrades which are year 2000 compliant.
Research and development expenses increased $101,000 or 11% to $1,007,000 in the
August, 1998 quarter from $906,000 in the August 1997 quarter. The increase is
primarily due to increased personnel costs to support existing product lines and
new product development.
The effective income tax rate decreased in the August 1998 quarter to 27% from
30% in the August 1997 quarter. This is principally due to an increase in the
percentage of earnings from the Company's foreign subsidiaries which are taxed
at lower rates than the Company's domestic operations.
Net income increased $132,000 or 3% in the August 1998 quarter, primarily due to
increased gross profits from increased process sales and lower effective income
tax rates, partially offset by increased selling, general and administrative
expenses.
- 13 -
<PAGE> 14
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
a) The Annual Meeting of Stockholders of the Registrant was held
on July 21, 1998.
b) Nine (9) directors, constituting the entire Board of
Directors, were elected for a term of one year, and until the
election and qualification of their successors. The following
nominees were elected by the Stockholders.
<TABLE>
<CAPTION>
Name First became a Director
---- -----------------------
<S> <C>
Barnet D. Ostrow (Chairman) 1953
Fred I. Nobel 1953
Sol Berg 1972
Ronald F. Ostrow 1975
Irwin Lieber 1980
Arthur M. Winston 1980
Kenneth L. Stein 1987
Richard Kessler 1987
Carl N. Graf 1992
</TABLE>
c) The Stockholders approved the employment of Ernst & Young LLP
as auditors of the Corporation for the current fiscal year.
d) The Stockholders approved an amendment of the Corporation's
Restated Certificate of Incorporation to increase the number
of authorized shares of common stock, par value $1.00 per
share, which the Corporation may issue, from 15,000,000 to
35,000,000.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits
The independent auditors are not examining this Form 10-Q
prior to submission by the Registrant.
b) There were no reports on Form 8-K filed for the three months
ended August 31, 1998.
- 14 -
<PAGE> 15
FORM 10-Q
LeaRonal, Inc. and Subsidiaries
PART II - OTHER INFORMATION
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 thereunto duly authorized.
LeaRonal, Inc.
(Registrant)
/s/ Ronald Ostrow
Ronald Ostrow
President and
Chief Executive Officer
/s/ David Rosenthal
David Rosenthal
Vice President - Finance
and Treasurer
Dated: October 12, 1998
- 15 -
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Balance
Sheet and Income Statement.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> FEB-28-1999
<PERIOD-START> MAR-01-1998
<PERIOD-END> AUG-31-1998
<EXCHANGE-RATE> 1
<CASH> 26635
<SECURITIES> 10369
<RECEIVABLES> 46092
<ALLOWANCES> 0
<INVENTORY> 26858
<CURRENT-ASSETS> 114987
<PP&E> 74322
<DEPRECIATION> 32583
<TOTAL-ASSETS> 171725
<CURRENT-LIABILITIES> 37521
<BONDS> 0
0
0
<COMMON> 14042
<OTHER-SE> 108083
<TOTAL-LIABILITY-AND-EQUITY> 171725
<SALES> 114226
<TOTAL-REVENUES> 116082
<CGS> 78950
<TOTAL-COSTS> 102614
<OTHER-EXPENSES> 852
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 278
<INCOME-PRETAX> 12338
<INCOME-TAX> 3371
<INCOME-CONTINUING> 8967
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8967
<EPS-PRIMARY> .71
<EPS-DILUTED> .69
</TABLE>
