- - - - --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended March 31, 1995
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file Number 0-8287
LINDBERG CORPORATION
DELAWARE 36-1391480
- - - - ------------------------ ------------------------------
State of Incorporation IRS Employer Identification No.
6133 North River Road, Suite 700
Rosemont, Illinois 60018
(708) 823-2021
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
------- -------
The number of shares of the Registrant's Common Stock outstanding as of
May 8, 1995 was: 4,724,516.
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LINDBERG CORPORATION AND SUBSIDIARIES
TABLE OF CONTENTS
Part I Financial Information: Page No.
Item 1. Consolidated Statements of Earnings - Three Months
Ended March 31, 1995 and 1994........................... 3
Consolidated Balance Sheets - As of March 31, 1995 and
and December 31, 1994 .................................. 4
Consolidated Statements of Cash Flows - Three Months
Ended March 31, 1995 and 1994........................... 5
Notes to the Consolidated Financial Statements ........... 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations .................... 7
Part II Other Information:
Item 6. Exhibits and Reports on Form 8-K ......................... 8
Signatures ............................................... 9
Exhibit Index ............................................ 10
Exhibit 3.2 - 1979 Amendment to Certificate of Amendment.. 12
Exhibit 11 - Computation of Net Earnings per Common
Share .................................................. 13
Exhibit 27 - Financial Data Schedule <PAGE>
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LINDBERG CORPORATION AND SUBSIDIARIES
PART I FINANCIAL INFORMATION
CONSOLIDATED STATEMENTS OF EARNINGS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
--------------------------
1995 1994
----------- -----------
<S> <C> <C>
Net Sales $33,580,053 $18,826,747
Cost of Sales 26,605,217 14,092,600
----------- -----------
Gross Profit 6,974,836 4,734,147
Selling and Administrative Expenses 4,052,586 3,021,819
----------- -----------
Earnings From Operations 2,922,250 1,712,328
Interest Expense - Net 428,793 69,719
----------- -----------
Earnings Before Income Taxes 2,493,457 1,642,609
Provision for Income Taxes 1,022,229 650,864
----------- -----------
Net Earnings $ 1,471,228 $ 991,745
----------- -----------
----------- -----------
Per Common and Common Equivalent
Share Amounts:
Net Earnings $ .31 $ .21
----------- -----------
----------- -----------
Weighted Average Common and Common
Equivalent Shares Outstanding 4,758,094 4,728,700
----------- -----------
----------- -----------
Cash Dividends Declared
and Paid $ .06 $ .05
----------- -----------
----------- -----------
</TABLE>
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LINDBERG CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
(Unaudited)
----------- ------------
<S> <C> <C>
CURRENT ASSETS:
Cash $ 109,603 $ 111,060
Receivables - Net 19,652,136 16,751,894
Inventories
Raw Material 1,591,096 1,678,239
Work in Process and Finished Goods 2,792,526 2,653,028
Prepaid and Refundable Income Taxes 1,261,739 2,027,147
Prepaid Expenses and Other Current Assets 3,523,782 2,665,358
----------- -----------
Total Current Assets 28,930,882 25,886,726
PROPERTY AND EQUIPMENT:
Cost 92,768,957 90,326,887
Accumulated Depreciation (52,785,404) (51,469,024)
----------- ----------
Net Property and Equipment 39,983,553 38,857,863
OTHER ASSETS 5,779,102 5,776,979
----------- ----------
TOTAL ASSETS $74,693,537 $70,521,568
----------- -----------
----------- -----------
CURRENT LIABILITIES:
Current Maturities on Long-Term Debt $ 1,501,478 $ 1,501,478
Accounts Payable 7,826,144 8,281,648
Accrued Expenses 6,814,095 7,496,115
----------- -----------
Total Current Liabilities 16,141,717 17,279,241
DEFERRED INCOME TAXES 6,551,387 6,491,387
LONG-TERM DEBT (less Current Maturities) 20,800,363 16,699,942
OTHER NON-CURRENT LIABILITIES 5,343,347 5,382,482
SHAREHOLDERS' EQUITY:
Common Shares, $2.50 par value: 14,183,493 14,183,493
Authorized 12,000,000 shares in 1995 and
1994. Issued 5,673,397 Shares in 1995
and 1994
Additional Paid-In Capital 1,531,600 1,531,600
Earnings Retained in the Business 15,750,047 14,561,840
Shares held in Treasury
(956,381 in 1995 and 1994), at Cost (5,405,657) (5,405,657)
Underfunded Pension Liability Adjustment (202,760) (202,760)
----------- ----------
Total Shareholders' Equity 25,856,723 24,668,516
----------- ----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $74,693,537 $70,521,568
----------- -----------
----------- -----------
</TABLE>
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LINDBERG CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
INCREASE (DECREASE) IN CASH March 31,
-------------------------
1995 1994
----------- -----------
<S> <C> <C>
Cash Flows from Operating Activities:
Net Earnings $ 1,471,228 $ 991,745
Adjustments to Reconcile Net Earnings
to Net Cash Provided by (Used in)
Operating Activities:
Depreciation 1,316,382 906,251
Increase in Deferred Income Taxes 60,000 45,000
Change in Assets and Liabilities (4,225,395) 453,324
----------- -----------
Total Adjustments to Reconcile Net Earnings
to Net Cash (2,849,013) 1,404,575
----------- -----------
Net Cash Provided by (Used in) Operating
Activities (1,377,785) 2,396,320
Cash Flows from Investing Activities:
Capital Expenditures (2,441,072) (663,093)
----------- -----------
Net Cash Used in Investing Activities (2,441,072) (663,093)
Cash Flows from Financing Activities:
Net Borrowings (Payments) Under Revolving
Credit Agreement 4,475,000 (1,500,000)
Payments Under Bank Term Loan (350,000) ---
Principal Payments of Capital Lease Obligations (24,579) ---
Dividends Paid (283,021) (235,227)
----------- -----------
Net Cash Provided by (Used in)
Financing Activities 3,817,400 (1,735,227)
Net Decrease in Cash (1,457) (2,000)
Cash at Beginning of Period 111,060 210,660
----------- -----------
Cash at End of Period $ 109,603 $ 208,660
----------- -----------
----------- -----------
Supplemental Disclosures of Cash Flow Information:
Interest Paid $ 395,759 $ 92,616
Income Taxes Paid - Net of Refunds 196,822 125,191
</TABLE>
<PAGE>
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LINDBERG CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS:
NOTE 1 The condensed consolidated financial statements included herein have
been prepared by the Company, without audit, pursuant to the rules
and regulations of the Securities and Exchange Commission.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations, although the Company
believes that the disclosures are adequate to make the information
presented not misleading. It is suggested that these condensed
financial statements be read in conjunction with the financial
statements and the notes thereto included in the Company's latest
annual report on Form 10-K.
Statements for the three month periods ended March 31, 1995 and
March 31, 1994 reflect, in the opinion of the Company, all adjustments
(consisting only of normal recurring accruals) necessary to present
fairly the results of these periods. Results for interim periods are
not necessarily indicative of results for a full year.
<PAGE>
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Sales for the first quarter of 1995 increased $14.8 million, or 78%, to $33.6
million from $18.8 million for the first quarter of 1994. The 1995 results
include sales for Impact Industries which was acquired in the second quarter of
last year. Excluding Impact's sales of nearly $10 million from the first
quarter of 1995, sales for the Company increased 26% from the prior year. The
Company continued to experience solid sales activity throughout most of its
operating units, but particularly at those serving customers in midwestern
markets.
The Company's earnings from operations increased $1.2 million to $2.9 million
from $1.7 million in 1994. This increase is generally a result of the
aforementioned sales increase as the Company's operating profit margin remained
largely unchanged from 1994.
Interest expense increased $359,000 to $429,000 from $70,000 as a result of the
increased borrowings related to the purchase of Impact and an increase in the
effective rate of borrowings.
As a result of the above, net earnings increased $479,000, or 48%, to $1.5
million from $1.0 million in 1994. Earnings per share increased $.10 to $.31
from $.21 in 1994.
FINANCIAL CONDITION AND LIQUIDITY
During the first quarter, the Company's borrowings increased $4.1 million to
$22.3 million from $18.2 million at the end of 1994. This raised the Company's
debt-to-capitalization ratio to 46% at the end of March from 42% at the end of
the previous year. The additional borrowings were required to fund an increase
in working capital - chiefly accounts receivable - which resulted mainly from
the previously mentioned increase in sales. Additional borrowings were also
required to fund an increase in spending on capital projects. Through March,
the Company made capital expenditures of $2.4 million. For all of 1995, the
Company expects to invest about $7 million in new capital projects. The
Company believes that its borrowing capacity and internal sources of funds are
sufficient to meet its expected operating, working capital and capital
investment needs.
On April 26, 1995, the Board of Directors declared a cash dividend of $.06 on
each of the Company's common shares, payable on June 1, 1995, to shareholders
of record at the close of business on May 10, 1995. This was the same amount
as was paid in the previous quarter.
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ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits Required by Item 601 of Regulation S-K - Exhibits
required by Item 601 of Regulation S-K are listed in the
Exhibit Index which is attached hereto at page 10 and
which is incorporated herein by reference.
(b) Reports on Form 8-K - There were no reports on Form
8-K filed for the three months
ended March 31, 1995.
<PAGE>
<PAGE>
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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.
LINDBERG CORPORATION
Principal Financial and Accounting By /s/ Stephen S. Penley
Officer: ------------------------
Stephen S. Penley
Senior Vice President
and Chief Financial Officer;
Principal Financial and
Accounting Officer
Dated: May 8, 1995
<PAGE>
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LINDBERG CORPORATION
Quarterly Report on Form 10-Q
for the Quarter Ended March 31, 1995
Exhibit Index
Page Number
Number and Description of Exhibit (or reference)
- - - - --------------------------------- --------------
2. Plan of acquisition, reorganization,
arrangement, liquidation or succession
2.1 Stock Purchase Agreement Dated
April 19, 1994 among Rexcorp
International Ltd., Marle Management Ltd.,
D.F. Haslam Management Ltd., and Gary E.
Miller and Lindberg Corporation (1)
3. Articles of Incorporation and By-Laws
3.1 Certificate of Incorporation (composite) (2)
3.2 1979 Amendment to Certificate of Incorporation Attached
3.3 1987 Amendment to Certificate of Incorporation (3)
3.4 By-Laws (as amended) (4)
4. Instruments defining the rights of security
holders, including indentures
4.1 Amended and Restated Credit Agreement (5)
Dated as of April 28, 1994
10. Material Contracts
10.1 Description of Bonus Program (6)
10.2 Consulting Agreement Between the
Registrant and G.H. Bodeen dated
October 25, 1990 (7)
10.3 1991 Stock Option Plan for Key Employees (8)
10.4 1991 Stock Option Plan for Directors (9)
11. Statement re computation of net earnings
per common share Attached
27. Financial Data Schedule Attached
<PAGE>
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-11-
(1) Incorporated by reference to Exhibit 2.1 of the Registrant's Report on
Form 8-K dated May 13, 1994, Commission file no. 0-8287.
(2) Incorporated by reference to Exhibit 3.1 of the Registrant's Report on
Form 10-K for the year ended December 31, 1980, Commission
file no. 0-8287.
(3) Incorporated by reference to page 6 of the Registrant's 1987 proxy
statement filed with the Registrant's Annual Report on Form 10-K for
the year ended December 31, 1986, Commission file no. 0-8287.
(4) Incorporated by reference to Exhibit 3.3 of the Registrant's Report on
Form 10-K for the year ended December 31, 1994, Commission
file no. 0-8287.
(5) Incorporated by reference to Exhibit 4.2 of the Registrant's Report on
Form 8-K dated May 13, 1994, Commission file no. 0-8287.
(6) Incorporated by reference to page 5 of the Registrant's 1991 proxy
statement filed with the Registrant's Annual Report on Form 10-K for
the year ended December 31, 1990, Commission file no. 0-8287.
(7) Incorporated by reference to Exhibit 10.5 of the Registrant's Report on
Form 10-K for the year ended December 31, 1990, Commission
file no. 0-8287.
(8) Incorporated by reference to Appendix A of the Registrant's 1991 proxy
statement filed with the Registrant's Annual Report on Form 10-K for
the year ended December 31, 1990, Commission file no. 0-8287.
(9) Incorporated by reference to Appendix B of the Registrant's 1991 proxy
statement filed with the Registrant's Annual Report on Form 10-K for
the year ended December 31, 1990, Commission file no. 0-8287.
EXHIBIT 3.2
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
LINDBERG CORPORATION
LINDBERG CORPORATION, a corporation organized and existing under the
laws of the State of Delaware, hereby certifies as follows:
1. That an amendment to Article FOURTH of the certificate of
incorporation of the Corporation has been duly adopted in accordance with the
provisions of section 242 of the General Corporation Law of Delaware, pursuant
to which Article FOURTH shall read as follows:
FOURTH. The total number of shares of
all classes of stock which the corporation shall
have authority to issue is 12,000,000, of which
all shall be shares of common stock, $2.50
par value.
2. That the capital of the Corporation will not be reduced under or
by reason of the foregoing amendment.
IN WITNESS WHEREOF, LINDBERG CORPORATION has caused this certificate
to be signed by its president this 27th day of April, 1979.
LINDBERG CORPORATION
By /s/ G. H. Bodeen
-------------------------------
G. H. Bodeen
President
ATTEST:
/s/ F. J. Waldeck
- - - - ----------------------------
F. J. Waldeck
Secretary
EXHIBIT 11
COMPUTATION OF NET EARNINGS PER COMMON SHARE
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-------------------------
1995 1994
----------- ----------
<S> <C> <C>
EARNINGS
Net Earnings $ 1,471,228 $ 991,745
----------- ----------
SHARES
Weighted Average Number of Common
Shares Outstanding 4,719,188 4,704,469
Common Share Equivalents 38,906 24,231
Weighted Average Common Shares Outstanding ----------- ----------
and Equivalents 4,758,094 4,728,700
----------- ----------
----------- ----------
PRIMARY EARNINGS PER COMMON SHARE
Net Earnings $ .31 $ .21
----------- ----------
----------- ----------
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FINANCIAL
STATEMENTS FOR THE PERIOD ENDED 03/31/95 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 109,603
<SECURITIES> 0
<RECEIVABLES> 19,652,136
<ALLOWANCES> 41,000
<INVENTORY> 4,383,622
<CURRENT-ASSETS> 28,930,882
<PP&E> 92,768,957
<DEPRECIATION> 52,785,404
<TOTAL-ASSETS> 74,693,537
<CURRENT-LIABILITIES> 16,141,717
<BONDS> 0
<COMMON> 14,183,493
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 74,693,537
<SALES> 33,580,053
<TOTAL-REVENUES> 33,580,053
<CGS> 26,605,217
<TOTAL-COSTS> 26,605,217
<OTHER-EXPENSES> 4,052,586
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 428,793
<INCOME-PRETAX> 2,493,457
<INCOME-TAX> 1,022,229
<INCOME-CONTINUING> 1,471,228
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,471,228
<EPS-PRIMARY> .31
<EPS-DILUTED> .31
</TABLE>
