<PAGE> 1
CONFORMED
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OF THE
SECURITIES EXCHANGE ACT OF 1934
For Quarter ended January 31, 2000
Commission file number: 0-6056
Michigan Rivet Corporation
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(exact name of registrant as specified in its charter)
Michigan 38-1887153
- ------------------------ ------------------------------------
(State of Incorporation) (I.R.S. Employer Identification No.)
13201 Stephens Road, Warren, MI 48089
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(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (810) 754-5100
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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 XX No
---- ----
There were 638,525 outstanding shares of the registrant's common stock, $1.00
par value, as of January 31, 2000, close of the period covered by this report.
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MICHIGAN RIVET CORPORATION
NOTE TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the interim periods are not necessarily
indicative of the results that may be expected for the year. For further
information, refer to the consolidated financial statements and footnotes
thereto included in the Company's Annual Report on Form 10-K for the year ended
October 31, 1999.
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<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
MICHIGAN RIVET CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
<TABLE>
<CAPTION>
ASSETS
January 31, October 31,
2000 1999
------------ -----------
Current Assets:
<S> <C> <C>
Cash............................................ $ 66,882 $ 99,220
Accounts receivable, less allowance of $50,000.. 5,134,447 6,004,636
Inventories..................................... 6,830,484 6,841,484
Deferred federal income taxes................... 805,000 805,000
Prepaid expenses and other current assets....... 224,863 232,500
------------ ------------
TOTAL CURRENT ASSETS...... 13,061,676 13,982,840
Other Assets...................................... 1,012,210 1,012,210
Property, Plant and Equipment..................... 28,750,532 27,839,912
Less accumulated depreciation................... 16,499,458 16,160,458
------------ ------------
12,251,074 11,679,454
------------ ------------
$26,324,960 $26,674,504
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Notes payable to bank........................... $ 1,476,000 $ 216,000
Accounts payable................................ 3,866,062 4,568,961
Payroll and employees benefits.................. 597,345 1,602,458
Other accrued expenses.......................... 619,110 750,998
Current maturities of long-term debt............ 321,315 321,315
------------ ------------
TOTAL CURRENT LIABILITIES 6,879,832 7,459,732
Long-Term Debt.................................... 1,644,844 1,720,167
Accrued Retiree Health Liability.................. 4,113,540 4,068,780
Shareholders' Equity
Common stock - $1 par value
Authorized - 1,000,000 shares
Outstanding - 638,525 shares............. 638,525 638,525
Other capital................................... 117,403 117,403
Retained earnings............................... 12,930,816 12,669,897
------------ ------------
13,686,744 13,425,825
------------ ------------
$26,324,960 $26,674,504
============ ============
</TABLE>
See notes to condensed consolidated financial statements.
3
<PAGE> 4
MICHIGAN RIVET CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
January 31
--------------------------
2000 1999
---------- ------------
<S> <C> <C>
Net sales .......................... $10,327,184 $10,654,801
Cost and expenses:
Cost of products sold ............ 8,872,872 9,087,298
Selling, administrative
and general expenses....... 773,806 863,234
Interest expense ................. 53,341 67,931
----------- -----------
9,700,019 10,018,463
----------- -----------
Income before
income taxes ........... 627,165 636,338
Income taxes ....................... 213,000 217,000
----------- -----------
Net Income ................ $ 414,165 $ 419,338
=========== ===========
Net income per share ............... $ .65 $ .66
=========== ===========
Dividends per share ................ $ .24 $ .20
=========== ===========
</TABLE>
See notes to condensed consolidated financial statements.
4
<PAGE> 5
MICHIGAN RIVET CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS (UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
January 31
----------------------------
2000 1999
----------- -----------
OPERATING ACTIVITIES
<S> <C> <C>
Net income ............................................. $ 414,165 $ 419,338
Adjustments to reconcile net income (loss) to net
cash used in operating activities:
Depreciation .................................... 339,000 315,150
Accrued retiree health liability ................ 44,760 46,698
Cash provided from (used in) changes in
operating assets and liabilities:
Accounts receivable ......................... 870,189 1,389,466
Inventories ................................. 11,000 239,000
Prepaid expenses and other current assets ... 7,637 (814)
Accounts payable & other accrued expenses ... (1,837,190) (2,009,090)
----------- -----------
NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES .................. (150,439) 399,748
INVESTING ACTIVITIES
Acquisition of property, plant and equipment ........... (910,620) (304,982)
FINANCING ACTIVITIES
Net proceeds from short-term debt ...................... 1,262,711 127,000
Payments on long-term debt ............................. (75,323) (75,505)
Dividends .............................................. (153,245) (127,705)
----------- -----------
NET CASH PROVIDED BY (USED IN) FINANCING
ACTIVITIES ............................ 1,028,721 (76,210)
----------- -----------
INCREASE (DECREASE) IN CASH ............ (32,338) 18,556
Cash at beginning of period .............................. 99,220 92,125
----------- -----------
CASH AT END OF PERIOD .................. $ 66,882 $ 110,681
=========== ===========
</TABLE>
See notes to condensed consolidated financial statements.
5
<PAGE> 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
MICHIGAN RIVET CORPORATION
Results of Operations
Net sales for the quarter ended January 31, 2000 of $10,327,000 decreased
$328,000, or 3%, from the sales reported in the comparable period a year ago.
The decrease in sales resulted from the slower than projected start up of new
business and a slower than expected production in one plant. The net profit for
the quarter ended January 31, 2000 was $414,000 vs. a profit of $419,000 in the
comparable period a year ago.
The increase in cost of sales percentage for the current fiscal year quarter is
due to lower volume along with an increase in manufacturing costs for labor and
tooling.
Selling, general, and administrative expenses have decreased to 7.5% of sales as
compared to 8.1% for the previous year comparable period. This decrease resulted
from lower single business income taxes, sales commissions and administrative
salaries.
Interest expense decreased $15,000 due primarily to lower short-term borrowing
during the period. The interest rate paid by the Company to Comerica Bank is
tied to the prevailing prime rate.
Liquidity and Capital Resources
The Company has short-term credit lines aggregating $5,000,000. At January 31,
2000, $1,476,000 was borrowed on this facility. Additionally, cash generated
from operations was used to purchase machinery and equipment and reduce
long-term debt. The Company anticipates
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that funds provided by operations together with funds available under its credit
lines will be sufficient to meet the Company's liquidity needs for the remainder
of fiscal year 2000.
YEAR 2000
The Company experienced no system failures or miscalculations as a result of
Y2K. The Company is not aware of any failure attributable to the Y2K problem and
its customers or suppliers which threaten to have any adverse impact on the
Company's business at this time.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
No reports on Form 8-K were filed during the quarter ended January 31, 2000.
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, hereunto, duly authorized.
Michigan Rivet Corporation
By /S/ William P. Lianos
---------------------
William P. Lianos
President and Treasurer
(Principal Financial & Accounting Officer)
Date 2-17-00
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Exhibit Index
-------------
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
(A) CONDENSED CONSOLIDATED BALANCE SHEETS AND STATEMENT OF OPERATIONS AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH (B) 10Q
</LEGEND>
<CIK> 0000065666
<NAME> MICHIGAN RIVET CORP.
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-2000
<PERIOD-START> NOV-01-1999
<PERIOD-END> JAN-31-2000
<EXCHANGE-RATE> 1
<CASH> 66,882
<SECURITIES> 0
<RECEIVABLES> 5,184,447
<ALLOWANCES> 50,000
<INVENTORY> 6,830,484
<CURRENT-ASSETS> 13,061,676
<PP&E> 28,750,532
<DEPRECIATION> 16,499,458
<TOTAL-ASSETS> 26,324,960
<CURRENT-LIABILITIES> 6,879,832
<BONDS> 1,644,844
0
0
<COMMON> 638,525
<OTHER-SE> 13,048,219
<TOTAL-LIABILITY-AND-EQUITY> 26,324,960
<SALES> 10,327,184
<TOTAL-REVENUES> 10,327,184
<CGS> 8,872,872
<TOTAL-COSTS> 8,872,872
<OTHER-EXPENSES> 773,806
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 53,341
<INCOME-PRETAX> 627,165
<INCOME-TAX> 213,000
<INCOME-CONTINUING> 414,165
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 414,165
<EPS-BASIC> .65
<EPS-DILUTED> .65
</TABLE>
