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 quarterly period ended September 30, 1999
------------------------
OR
[ ] 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 0-545
-----
Moore Products Co.
- -------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Pennsylvania 23-1427830
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Spring House, PA 19477
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code) (215) 646-7400
--------------
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 31, 1999, the number of shares of Registrant's Common Stock
outstanding was 2,640,346.
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
MOORE PRODUCTS CO.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30
--------------------------------------------
1999 1998
---------------- -----------------
<S> <C> <C>
Net sales $ 123,474,000 $ 122,736,000
Cost of sales 73,540,000 73,341,000
---------------- -----------------
Gross profit 49,934,000 49,395,000
Selling, research and development,
administrative and general expenses 45,941,000 43,110,000
---------------- -----------------
Operating income 3,993,000 6,285,000
Interest expense 170,000 60,000
---------------- -----------------
Income before income taxes 3,823,000 6,225,000
Income tax provision 1,661,000 3,089,000
---------------- -----------------
Net income $ 2,162,000 $ 3,136,000
================ =================
Earnings per common share:
Basic $ .82 $1.20
===== =====
Diluted $ .77 $1.09
===== =====
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
2
<PAGE>
MOORE PRODUCTS CO.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
September 30
--------------------------------------------
1999 1998
---------------- -----------------
<S> <C> <C>
Net sales $ 42,701,000 $ 40,738,000
Cost of sales 26,641,000 24,532,000
---------------- -----------------
Gross profit 16,060,000 16,206,000
Selling, research and development,
administrative and general expenses 15,458,000 14,362,000
---------------- -----------------
Operating income 602,000 1,844,000
Interest expense 127,000 40,000
---------------- -----------------
Income before income taxes 475,000 1,804,000
Income tax provision 269,000 1,227,000
---------------- -----------------
Net income $ 206,000 $ 577,000
================ =================
Earnings per common share:
Basic $ .08 $ .22
===== =====
Diluted $ .07 $ .20
===== =====
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
3
<PAGE>
MOORE PRODUCTS CO.
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30 December 31
1999 1998
ASSETS ------------------------------------------
CURRENT ASSETS (Unaudited) (Note A)
<S> <C> <C>
Cash and cash equivalents $ 2,618,000 $ 7,549,000
Trade accounts receivable, less allowances of
$1,018,000 in 1999 and $1,213,000 in 1998 42,884,000 41,945,000
Inventories 18,890,000 15,932,000
Prepaid expenses and deferred income taxes 4,915,000 4,394,000
---------------- -----------------
TOTAL CURRENT ASSETS 69,307,000 69,820,000
PROPERTY, PLANT AND EQUIPMENT 66,887,000 63,182,000
Less: Accumulated depreciation (50,608,000) (47,267,000)
---------------- -----------------
16,279,000 15,915,000
OTHER ASSETS
Prepaid pension costs 19,239,000 16,232,000
---------------- -----------------
$ 104,825,000 $ 101,967,000
================ =================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 10,019,000 $ 10,772,000
Accrued compensation 3,788,000 4,022,000
Advances from customers 6,758,000 5,076,000
Accrued income taxes 1,307,000 1,242,000
Other accrued liabilities 8,411,000 8,708,000
---------------- -----------------
TOTAL CURRENT LIABILITIES 30,283,000 29,820,000
OTHER LIABILITIES 9,196,000 9,192,000
STOCKHOLDERS' EQUITY
Preferred Stock, 5% cumulative, voting
and convertible, par value $1 per share:
Authorized - 325,000 shares
Issued and outstanding - 175,950 shares 176,000 176,000
Common Stock, par value $1 per share:
Authorized - 7,500,000 shares
Issued and outstanding - 2,640,346 shares
in 1999 and 2,619,471 shares in 1998 2,640,000 2,619,000
Capital in excess of par value 11,808,000 11,479,000
Retained earnings 52,745,000 51,169,000
Accumulated other comprehensive income (loss) (2,023,000) (2,488,000)
---------------- -----------------
TOTAL STOCKHOLDERS' EQUITY 65,346,000 62,955,000
---------------- -----------------
$ 104,825,000 $ 101,967,000
================ =================
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
4
<PAGE>
MOORE PRODUCTS CO.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30
------------------------------------------
1999 1998
--------------- ----------------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $ 2,162,000 $ 3,136,000
Noncash (income) expenses:
Depreciation 3,352,000 2,903,000
Deferred income taxes (3,000) (348,000)
Pension and other postretirement benefits (3,007,000) (2,719,000)
Changes in operating assets and liabilities:
Trade accounts receivable (939,000) 942,000
Inventories (2,958,000) (1,454,000)
Accounts payable (753,000) (1,683,000)
Other accrued liabilities (297,000) 1,558,000
Accrued compensation (234,000) (1,254,000)
Advances from customers 1,682,000 1,172,000
Accrued income taxes 65,000 571,000
Prepaid expenses (514,000) (490,000)
--------------- ----------------
Net cash (used in) provided by
operating activities (1,444,000) 2,334,000
INVESTING ACTIVITY:
Net purchase of property, plant and equipment (3,696,000) (3,968,000)
FINANCING ACTIVITIES:
Increase (decrease) in notes payable to bank --- 1,700,000
Proceeds from exercise of stock options 350,000 382,000
Cash dividends paid (586,000) (1,047,000)
--------------- ----------------
Net cash (used in) provided by financing activities (236,000) 1,035,000
Effect of exchange rate changes 445,000 (347,000)
--------------- ----------------
NET DECREASE IN CASH AND
CASH EQUIVALENTS (4,931,000) (946,000)
Cash and cash equivalents at beginning of year 7,549,000 3,816,000
--------------- ----------------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 2,618,000 $ 2,870,000
=============== ================
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
5
<PAGE>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
MOORE PRODUCTS CO.
September 30, 1999
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 in compliance with the Instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all 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 three and nine month periods ended
September 30, 1999 are not necessarily indicative of the results that may be
expected for the year ended December 31, 1999.
The balance sheet at December 31, 1998 has been derived from the audited
financial statements at that date.
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 December 31, 1998.
Certain reclassifications have been made in prior periods' financial statements
in order to conform with the current-period basis of presentation.
Note B - Inventories
The components of inventory consist of the following:
September 30 December 31
1999 1998
---------------- -----------------
Completed instruments $ 2,797,000 $ 2,882,000
Finished parts 7,813,000 7,691,000
Work in process 7,881,000 4,945,000
Raw material 399,000 414,000
---------------- -----------------
$ 18,890,000 $ 15,932,000
================ =================
6
<PAGE>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
MOORE PRODUCTS CO.
September 30, 1999
Note C - Earnings per Share
The following table sets forth the computation of basic and diluted earnings per
share:
<TABLE>
<CAPTION>
Nine Months Ended
September 30
---------------------------------------
1999 1998
-------------- ---------------
<S> <C> <C>
Numerator:
Net income $ 2,162,000 $ 3,136,000
Preferred stock dividends (7,000) (7,000)
-------------- ---------------
Numerator for basic earnings per share -
income available to common stockholders 2,155,000 3,129,000
Effect of dilutive securities:
Preferred stock dividends 7,000 7,000
-------------- ---------------
Numerator for diluted earnings per share -
income available to common stockholders
after assumed conversions $ 2,162,000 $ 3,136,000
============== ===============
Denominator:
Denominator for basic earnings per share -
weighted average shares 2,635,649 2,609,799
Effect of dilutive securities:
Stock options 91,824 198,925
Convertible preferred stock 70,380 70,380
-------------- ---------------
Dilutive potential common shares 162,204 269,305
-------------- ---------------
Denominator for diluted earnings per share -
adjusted weighted average shares and
assumed conversions 2,797,853 2,879,104
============== ===============
Basic income per share $ .82 $1.20
===== =====
Diluted income per share $ .77 $1.09
===== =====
</TABLE>
7
<PAGE>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
MOORE PRODUCTS CO.
September 30, 1999
Note C - Earnings per Share (continued)
<TABLE>
<CAPTION>
Three Months Ended
September 30
---------------------------------------
1999 1998
-------------- ---------------
<S> <C> <C>
Numerator:
Net income $ 206,000 $ 577,000
Preferred stock dividends (2,000) (2,000)
-------------- ---------------
Numerator for basic earnings per share -
income available to common stockholders 204,000 575,000
Effect of dilutive securities:
Preferred stock dividends 2,000 2,000
-------------- ---------------
Numerator for diluted earnings per share -
income available to common stockholders
after assumed conversions $ 206,000 $ 577,000
============== ===============
Denominator:
Denominator for basic earnings per share -
weighted average shares 2,639,380 2,616,384
Effect of dilutive securities:
Stock options 98,137 135,799
Convertible preferred stock 70,380 70,380
-------------- ---------------
Dilutive potential common shares 168,517 206,179
-------------- ---------------
Denominator for diluted earnings per share -
adjusted weighted average shares and
assumed conversions 2,807,897 2,822,563
============== ===============
Basic income per share $ .08 $ .22
===== =====
Diluted income per share $ .07 $ .20
===== =====
</TABLE>
Note D - Comprehensive Income
During the nine month periods ended September 30, 1999 and 1998, total
comprehensive income, which is comprised of net income and net change in the
accumulated foreign currency translation adjustment for the nine month period,
amounted to $2,627,000 and $2,749,000, respectively. For the quarters ended
September 30, 1999 and 1998, total comprehensive income, which is comprised of
net income and net change in the accumulated foreign currency translation
adjustment account for the three month period, amounted to $493,000 and
$232,000, respectively.
8
<PAGE>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
MOORE PRODUCTS CO.
September 30, 1999
Note E - Segment and Geographic Information
<TABLE>
<CAPTION>
United
States Europe Other Eliminations Consolidated
--------------------------------------------------------------------------
Nine Months Ended 9/30/99 (Thousands of dollars)
<S> <C> <C> <C> <C> <C>
Sales to unaffiliated customers $ 90,886 $ 16,966 $ 15,622 $ -- $ 123,474
Sales and transfers between
geographic areas 11,731 3,648 1,760 (17,139) --
------------ ----------- ---------- ----------- -----------
Total revenue $ 102,617 $ 20,614 $ 17,382 $ (17,139) $ 123,474
============ =========== ========== =========== ===========
Operating income (loss) $ 3,600 $ (302) $ 695 $ -- $ 3,993
Net property, plant and equipment 12,842 1,924 1,513 -- 16,279
Total assets 87,656 22,512 12,220 (17,563) 104,825
Nine Months Ended 9/30/98
Sales to unaffiliated customers $ 89,885 $ 18,815 $ 14,036 $ -- $ 122,736
Sales and transfers between
geographic areas 12,970 1,732 1,718 (16,420) --
------------ ----------- ---------- ----------- -----------
Total revenue $ 102,855 $ 20,547 $ 15,754 $ (16,420) $ 122,736
============ =========== ========== =========== ===========
Operating income (loss) $ 5,638 $ (668) $ 1,315 $ -- $ 6,285
Net property, plant and equipment 12,468 2,201 1,624 -- 16,293
Total assets 77,863 22,400 13,819 (17,642) 96,440
Three Months Ended 9/30/99
Sales to unaffiliated customers $ 29,949 $ 7,367 $ 5,385 $ -- $ 42,701
Sales and transfers between
geographic areas 3,435 1,680 731 (5,846) --
------------ ----------- ---------- ----------- -----------
Total revenue $ 33,384 $ 9,047 $ 6,116 $ (5,846) $ 42,701
============ =========== ========== =========== ===========
Operating income (loss) $ 755 $ (116) $ (37) $ -- $ 602
Three Months Ended 9/30/98
Sales to unaffiliated customers $ 30,084 $ 5,536 $ 5,118 $ -- $ 40,738
Sales and transfers between
geographic areas 3,765 411 497 (4,673) --
------------ ----------- ---------- ----------- -----------
Total revenue $ 33,849 $ 5,947 $ 5,615 $ (4,673) $ 40,738
============ =========== ========== =========== ===========
Operating income (loss) $ 2,143 $ (1,057) $ 758 $ -- $ 1,844
</TABLE>
9
<PAGE>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
MOORE PRODUCTS CO.
September 30, 1999
Note F - Contingent Liabilities
Various legal actions and proceedings have been or may be initiated or asserted
against the Company in the ordinary course of business, including those
pertaining to environmental, contractual and general liability. While the
Company has provided reserves for the estimated ultimate liability of such
claims, the final outcome could further impact operations and liquidity in
future periods, but, in the opinion of management, will not have a materially
adverse effect on the financial position of the Company.
10
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
This report contains various forward-looking statements and includes assumptions
concerning Moore Products Co.'s ("Moore") operations, future results and
prospects. These forward-looking statements are based on current expectations
and subject to risks and uncertainties. Moore does not undertake any obligation
to publicly release the results of any revisions that may be made to these
forward-looking statements to reflect any future events or circumstances.
In connection with the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, Moore provides this cautionary statement
identifying important factors that, among others, could cause the actual results
and events to differ materially from those set forth in or implied by
forward-looking statements and related assumptions. Such factors include, but
are not limited to: product demand and market acceptance risks; the effect of
global economic conditions; the impact of competitive products and pricing;
product development, commercialization and technological difficulties; capacity
and supply constraints or difficulties; availability of capital resources;
general business conditions; changes in government laws and regulations,
including taxes; and uncertainties related to Year 2000 issues. Further
information concerning factors that potentially could materially affect Moore's
financial results is included in Moore's 1998 Form 10-K, 1999 Form 10-Q's and
other reports filed with the Securities and Exchange Commission.
Results of Operations
Sales for the third quarter of 1999 were $42,701,000 compared to $40,738,000 for
the same period last year, a 5% increase. Year-to-date sales for the nine months
ended September 30, 1999 were $123,474,000 compared to $122,736,000 for the same
period last year, a 1% increase. Sales of APACS+ and Quadlog open control
systems products and services are at volumes above the prior year on a quarterly
and nine-month basis. Meanwhile, we continue to see sales of more traditional
discrete control devices including pneumatics, transmitters and loop controllers
at levels lower than the prior year. This reflects a continuing trend of lower
demand for these products.
The increasing significance of larger systems sales to the overall business of
Moore has resulted in increasing variability of bookings. Order bookings for the
third quarter of 1999 were $41,093,000 compared to $42,680,000 for the same
period last year. Year-to-date order bookings in 1999 were $124,424,000 compared
to $131,462,000 for the same period last year. While 1999 order bookings through
September for process automation systems remain strong in the United States and
Asia-Pacific, our United Kingdom subsidiary experienced a reduction in order
bookings due to approximately $7 million of large process automation systems in
1998 that were not repeated in the current year. The consolidated backlog of
unshipped orders as of September 30, 1999 was $44,852,000 compared to
$46,302,000 as of September 30, 1998. Approximately 68% of this backlog is
expected to be shipped in 1999.
11
<PAGE>
Gross profit for the quarter was $16,060,000, or 38% of sales, compared to
$16,206,000, or 40% of sales, for the third quarter of 1998. The quarterly gross
profit margin percentage declined due to higher engineering content on systems'
projects. Gross profit year-to-date was $49,934,000, or 40% of sales, compared
to $49,395,000, or 40% of sales, in 1998. The gross profit margin percentage on
a year-to-date basis did not change compared to last year.
Selling, research and development, administrative and general expenses for the
third quarter were $15,458,000, or 36% of sales, compared to $14,362,000, or 35%
of sales in 1998. These expenses year-to-date were $45,941,000, or 37% of sales,
compared to $43,110,000, or 35% of sales, in 1998. Higher payroll and other
expenses related to new product development and marketing were the primary
reasons for these increases.
Interest expense for the third quarter of 1999 was $127,000 compared to $40,000
for the same quarter last year. Year-to-date interest expense was $170,000
compared to $60,000 for the same nine month period in 1998. This increase from
last year was attributed to an increase in short-term borrowing activity in
1999.
Moore's third quarter effective tax rate was 57% of pretax income compared to
68% for the same period in 1998. The quarterly effective tax rate was favorably
impacted by improved operating results in countries for which tax loss carryover
benefits are available. The year-to-date effective tax rate was 43% of pretax
income compared to 50% for the first nine months of 1998. Statutory rates are
applied to pretax income in the United States. Consistent with previous
reporting periods, tax benefits for losses incurred by certain international
subsidiaries in tax jurisdictions outside the United States have not been fully
recognized for financial reporting purposes because the realization of such
benefits is not presently assured.
Net income for the third quarter ended September 30, 1999 was $206,000 compared
to net income of $577,000 for the third quarter of 1998. For the nine months
ended September 30, 1999, net income was $2,162,000 compared to $3,136,000 for
the same period in 1998. Diluted net income per share was $0.07 for the third
quarter of 1999 compared to $0.20 for the third quarter of 1998. For the nine
months ended September 30, 1999, diluted net income per share was $0.77 compared
to $1.09 in 1998.
Liquidity and Capital Resources
Cash and cash equivalents decreased during the nine month period ended September
30, 1999 by $4,931,000. This decrease was the result of negative cash flow from
operating activities, capital expenditures and a special 22-cent per share cash
dividend declared in January 1999 on the common stock. Capital expenditures were
primarily related to facilities and equipment in support of sales and marketing
promotion and product development.
Working capital decreased slightly at September 30, 1999 to $39,024,000 from
$40,000,000 at December 31, 1998. Accounts receivable increased $939,000 in the
first nine months of 1999 due to higher sales in the third quarter. During the
first nine months of 1999, inventory levels increased by $2,958,000 reflecting
an increase in work in process inventory and customer backlog
12
<PAGE>
for process automation systems. Advances from customers have also increased by
$1,682,000 for the same reason.
Cash and cash equivalents amounted to $2,618,000 at September 30, 1999. Moore
had no outstanding borrowings under credit arrangements at September 30, 1999.
During the second quarter, Moore invested approximately $1.0 million in new
business ventures. This included the acquisition of Verax Systems, a developer
of statistical process control software for industrial manufacturing
applications and a complementary extension to Moore's dimensional measurement
solutions for discrete parts manufacturers. Moore also completed a joint venture
in France to enhance its distribution capabilities in Europe and North Africa.
Management believes that current cash and cash equivalents, cash flow from
operations, and its established credit facilities of approximately $16,000,000
should be sufficient during 1999 to fund planned capital expenditures, working
capital needs, dividends, and other anticipated cash requirements.
Year 2000 Readiness
As more fully described in Moore's annual report on Form 10-K for the year ended
December 31, 1998, Moore has undertaken a program to evaluate, test and modify
or replace certain software and hardware to try to assure no disruption in
operations beyond December 31, 1999. Moore has evaluated its internal, general
purpose and production hardware and software systems, as well as any embedded
logic devices used to control equipment or facilities, to identify any elements
requiring modification to become Year 2000 compliant. In addition, Moore has
communicated with key suppliers of goods and services and customers to determine
their state of Year 2000 readiness.
Moore's significant computer systems have been upgraded, modified, tested and
are believed to be compliant.
Moore has made an assessment of its current product offerings and believes that
it has identified all products that have date-sensitive software or embedded
chips. Analysis by a team of Moore's development engineers suggests that Year
2000 and other date-sensitive compliance should have minimal impact on Moore's
products. Testing to confirm proper operation for the potentially affected
products was completed in the second quarter of 1999.
Amounts expended for Year 2000 projects have not been and are not expected to be
significant to Moore's results of operations or financial condition. The total
costs of Year 2000 projects, incurred to date and/or expected to be incurred,
including special contingency planning activities, are currently estimated to be
$800,000.
Management believes that it has an effective program in place to resolve the
Year 2000 issue in a timely manner. However, because of the range of possible
issues and the large number of variables involved, it is impossible to quantify
the potential cost of problems should Moore or its trading partners fail to
complete all Year 2000 plans and become completely Year 2000 compliant. The
current assessment is that such costs and failure of compliance efforts would
not have a materially adverse effect on the Company. Moore believes that the
most likely risks of serious Year 2000 business disruption are external in
nature, including disruption of utility and
13
<PAGE>
transportation services, suppliers' and customers' noncompliance, and
disruptions in the general economy. To the extent that these factors impact the
Company's sales or ability to deliver its products and services, they could have
a materially adverse effect on the Company, but there can be no assurance that
such would be the case. In addition, Moore could be subject to litigation
relating to Year 2000 compliance issues. The amount of potential liability and
lost revenue cannot be reasonably assessed or estimated at this time.
During the third quarter of 1999, Moore formulated contingency plans related
specifically to identified Year 2000 risks and developed cost estimates related
to these plans. Contingency plans may include increasing inventory levels,
securing alternative sources of supply, special staffing for technical support
to customers and other appropriate measures. Year 2000 contingency plans and
related cost estimates will continue to be reviewed and modified as additional
information becomes available.
Market and Other Risks
Moore's primary development and manufacturing activities are located in the
United States. Increasing sales of its products into international markets make
Moore vulnerable to such factors as foreign currency exchange rates or weak
economic conditions in such markets. Moore's operating results are exposed to
changes in exchange rates between the U.S. dollar and the Canadian dollar, the
U.K. pound sterling, and other currencies in Western Europe and Asia-Pacific. To
a certain extent, foreign currency exchange rate movements affect Moore's
competitive position, as exchange rate changes may influence business practices
and/or pricing strategies of non-U.S. based competitors. In addition,
transactions between the U.S. parent company and its international subsidiaries,
which are generally denominated in U.S. dollars, are subject to gains or losses
in the consolidated financial statements. Moore does not typically hedge these
transactions but attempts to limit exposure to these situations by timely
settlement of the U.S. dollar liabilities in the subsidiary locations. Moore
maintains lines of credit in Canada and the United Kingdom to help facilitate
this approach. Foreign exchange transaction gains in the first nine months of
1999 amounted to approximately $58,000. The Economic Monetary Union (EMU) has
initiated changes to monetary policy and foreign exchange, including adoption of
the Euro as a single currency for several European countries. Based upon Moore's
current business structure in Europe, it is anticipated that these changes will
not have a material impact on Moore. Throughout 1999, Moore will continue to
evaluate the implications of this change, including, but not limited to,
financial and statutory reporting, the structure of business transactions,
business systems that might be required to support the change, and its relative
competitive position in geographic markets that participate in the EMU.
Item 3. Quantitative and Qualitative Disclosure of Market Risk.
Disclosure about market risk is contained under "Market and Other Risks" in Item
2 above.
14
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits:
Exhibit
Number Description
- ------- -----------
27 Financial Data Schedule for Quarter Ended September 30, 1999.
(b) No reports on Form 8-K were filed during the most recently completed fiscal
quarter.
15
<PAGE>
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.
MOORE PRODUCTS CO.
Dated: November 12, 1999 By: /s/ R. E. Wisniewski
------------------------------------------
As Secretary and Treasurer and as
Principal Financial and Accounting Officer
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> SEP-30-1999
<CASH> 2618000
<SECURITIES> 0
<RECEIVABLES> 43902000
<ALLOWANCES> 1018000
<INVENTORY> 18890000
<CURRENT-ASSETS> 69307000
<PP&E> 66887000
<DEPRECIATION> 50608000
<TOTAL-ASSETS> 104825000
<CURRENT-LIABILITIES> 30283000
<BONDS> 0
0
176000
<COMMON> 2640000
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 104825000
<SALES> 123474000
<TOTAL-REVENUES> 123474000
<CGS> 73540000
<TOTAL-COSTS> 73540000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 170000
<INCOME-PRETAX> 3823000
<INCOME-TAX> 1661000
<INCOME-CONTINUING> 2162000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2162000
<EPS-BASIC> .82
<EPS-DILUTED> .77
</TABLE>
