FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C.
_________
QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF
THE SECURITIES EXCHANGE ACT OF 1934
_________
For the Quarter ended January 31, 1996 Commission file No. 0-0767
_________
LINCOLN INTERNATIONAL CORPORATION
(Exact Name of Registrant as specified in its charter)
Kentucky 61-0575092
(State of other Jurisdiction (I.R.S. Employer
incorporation or organization) Identification Number)
P.O. Box 43129
120 Village Square
Louisville, Kentucky 40243
(Address or principal executive offices) (Zip Code)
(Registrants Telephone Number, Including Area Code) (502) 245-8814
Indicate by check 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 of 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
Indicate the numbers of shares outstanding of each of the issuer' classes of
common stock, as of the close of the period covered by this report: 1532320
of the (no-par) nonvoting common and 100000 of the (no-par) voting common
stock.
LINCOLN INTERNATIONAL CORPORATION
CONSOLIDATED BALANCE SHEETS
ASSETS 1-31-96 7-31-95
Current assets:
Cash 179848 332682
Other receivables 14489 22708
Prepaid expenses 3474 7091
Total current assets 197811 362481
Net property, plant and equipment 1232060 1260885
Total assets 1429871 1623366
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable 48478 66610
Accrued expenses 45358 93609
Current maturities of long-term debt 320441 318809
Total current liabilities 414277 479028
Long-term debt, less current maturities 724625 733640
Stockholders equity
Common stock:
Voting 100000 shares O/S 50000 50000
Nonvoting 1532320 shares O/S 766160 766160
Additional paid in capital 471300 471300
Retained earnings -985260 -865891
Less: Treasury stock -10871 -10871
Total stockholders' equity 290969 410698
Total liabilities and stockholders' equity 1429871 1623366
LINCOLN INTERNATIONAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDING JANUARY 31
1-31-96 1-31-95
Revenues:
Net service and operating revenues 71934 350739
Net product sales 0 36533
Finance charges and other finance income 0 19781
71934 407053
Cost and expenses:
Cost of service and operating revenues 38974 286078
Cost of products sold 0 32293
Operating, general and administrative expenses 89487 93860
Provision for credit losses on finance receivables 0 -129
Interest expense related to finance subsidiary 3025 3350
131486 415452
Income - Loss from operations -59552 -8399
Other income - expense:
Interest expense -21000 -21045
Gain on sale of assets 1939 117061
Miscellaneous 569186 9009
550125 105025
Income - Loss before income taxes 490573 96626
Provision for income taxes 0 1125
Net income - loss 490573 95501
Net income - loss per common share 0.30 0.06
LINCOLN INTERNATIONAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDING JANUARY 31
1-31-96 1-31-95
Revenues:
Net service and operating revenues 146865 646133
Net product sales 0 63991
Finance charges and other finance income 0 78023
146865 788147
Cost and expenses:
Cost of service and operating revenues 57574 513082
Cost of products sold 0 55533
Operating, general and administrative expenses 170215 192253
Provision for credit losses on finance receivables 0 7436
Interest expense related to finance subsidiary 7562 8375
235351 776679
Income - Loss from operations -88486 11468
Other income - expense:
Interest expense -44000 -42090
Gain on sale of assets 1939 121008
Miscellaneous 574618 11231
532557 90149
Income - Loss before income taxes 444071 101617
Provision for income taxes 0 1618
Net income - loss 444071 99999
Net income - loss per common share 0.27 0.06
LINCOLN INTERNATIONAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOW
FOR THE YEAR TO DATE TO JANUARY 31
1996 1995
Cash flows from operating activities:
Net income (loss) 444071 99999
Adjustments to reconcile net income
to net cash provided by (used in)
operating activities:
Depreciation and amortization 29763 35796
Provision for credit losses on
finance receivables 0 19870
Other receivables 8219 -85124
Inventories 0 783
Non-cash dividend from subsidiary -563800 0
Other 7234 0
Prepaid expenses -3617 2351
Accounts payable -18132 10112
Income taxes payable 0 1618
Accrued expenses -48251 -35469
Deferred insurance commissions 0 -2435
Total adjustments -588584 -52498
Net Cash provided by (used in) operating activities -144513 47501
Cash flows from investing activities:
Loans originated 0 -342600
Loans repaid or sold 0 747855
Proceeds from sale of fixed assets 2500 3200
Purchases of property and equipment -3438 -1173
Net cash provided by (used in) investing activities -938 407282
Cash flows from financing activities:
Net borrowings (repayments) under
short term notes payable 1632 -90379
Principal payments on long-term debt -9015 -19060
Net cash provided by (used in) financing activities -7383 -109439
Net increase (-decrease) in cash -152834 345344
Cash, beginning of year 332682 21238
Cash, end of period 179848 366582
Supplemental disclosure of cash flow information:
Cash paid during the year for interest 55827 52955
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
JANUARY 31, 1996
Agri-Business
Bourbon Stockyard
During the last month of fiscal year 1995 the Bourbon Stock Yard
operations were leased to Michigan Livestock Exchange. Under this lease,
Bourbon is to receive a minimum monthly rental of $18,000 per month. If
seventy five percent (75%) of the net profits exceed $18,000 then Bourbon
would receive that amount as the lease payment.
Net revenue from stockyard operations decreased by approximately
$287,700 or 81% during the quarter ended January 31, 1996 as compared to the
quarter ended January 31, 1995. For the 6 months ended January 31, 1996, net
revenue decreased by approximately $523,800 or 78% as compared to 1995. This
decrease is a result of leasing the property to Michigan Livestock Exchange.
Operating costs for the quarter ended January 31, 1996 decreased
approximately $239,600 or 86% as compared to the same quarter ended
January 31, 1995. For the 6 months ended January 31, 1996, operating costs
decreased approximately $440,500 or 88% as compared to 1995. This decrease
was a result of leasing the property to Michigan Livestock Exchange.
Net revenue from stockyard operations increased by approximately
$66,000 or 23% during the quarter ended January 31, 1996 as compared to the
quarter ended January 31, 1995. For the 6 months ended January 31, 1996, net
revenue increased by approximately $38,000 or 6% as compared to 1995. This
increase is a result of increased receipts of approximately 5,200 cattle and
an increase of approximately 600 head of hogs for the year to date as
compared to 1995. This increase is due primarily to the weather conditions
in December and January.
Operating costs for the quarter ended January 31, 1996 increased
approximately $36,000 or 14% as compared to the same quarter ended
January 31, 1995. For the 6 months ended January 31, 1996, operating costs
increased approximately $37,000 or 6% as compared to 1995. This increase
reflects increased labor costs necessary to handle the number of cattle
received on the market.
Operating costs, which include amortization and depreciation,
accounted for 59% and 81% of operating revenues for the years 1996 and 1995,
respectively.
Inventories of cattle and hogs on the farm in the local area
continue to increase a small percentage each year. However, each year a
larger percentage of animals are moving directly from the farm to feedlots
and packing houses.
Bourbon Stock Yard did not have any capital commitments at
January 31, 1996.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
JANUARY 31, 1996
The stockyard had approximately $7,200 in accounts payable and
accrued liabilities at January 31, 1996. This is a normal amount at this
time of the year and is well within its cash flow ability to handle these
obligations as they become due. All funds in excess of expenses are
available to the parent.
Consolidated Operations
Net revenues increased by approximately $257,000 or 167% for the
quarter ended January 31, 1996 as compared to the quarter ended January 31,
1995. Net revenues for the 6 months ended January 31, 1996 decreased by
approximately $22,000 or 3% as compared to 1995. This decrease is due to the
decreased revenue at Bourbon Stock Yards and the receipt of a non-cash
dividend of $563,800 from Lincoln Finance Co., a wholly owned subsidiary.
Operating costs for the period ended January 31, 1996 were down
approximately $248,000 or 69% as compared to 1995. For the 6 months ended
January 31, 1996, operating costs were down approximately $479,000 or 71% as
compared to 1995. This decrease is due primarily to the decreased costs
associated with Bourbon Stock Yards.
Net revenues increased by approximately $44,000 or 13% for the
quarter ended January 31, 1996 as compared to the quarter ended January 31,
1995. Net revenues for the 6 months ended January 31, 1996 increased by
approximately $16,000 or 2% as compared to 1995. This increase is due
primarily to increased revenue at Bourbon Stock Yards.
Operating costs for the period ended January 31, 1996 were up
approximately $40,000 or 11% as compared to 1995. For the 6 months ended
January 31, 1996, operating costs were up approximately $53,000 or 8% as
compared to 1995. This increase is the result of increased labor cost at
Bourbon.
Operating costs, which include amortization and depreciation,
accounted for 177% and 103% of net sales and operating revenues for the years
1996 and 1995 respectively.
There were no capital commitments at January 31, 1996.
Working capital at July 31, 1995 was approximately -$116,500. At
January 31, 1996 working capital was approximately $-216,000.
NO DIVIDENDS WERE PAID BY THE COMPANY DURING THE INTERIM PERIOD.
Lincoln International Corporation was not required to file a
Form 8K during the current quarter.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
JANUARY 31, 1996
The unaudited consolidated financial statements include the
accounts of the Company and all of its subsidiaries after eliminating all
material intercompany accounts and transactions. They reflect all
adjustments which are necessary in the opinion of management to fairly state
the financial position of the Company at January 31, 1996 and the result of
its operations and cash flow for the period then ended.
-SIGNATURES-
Pursuant to the requirement 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.
LINCOLN INTERNATIONAL CORPORATION
Lee Sisney, President
Ronald Osborn, Treasurer
Dated this 4th day of March 1996
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