UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
November 4, 1996 (November 1, 1996)
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Date of Report (Date of earliest event reported)
MERRIMAC INDUSTRIES, INC.
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(Exact name of registrant as specified in its charter)
New Jersey 0-11201 22-1642321
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
41 Fairfield Place, West Caldwell, New Jersey 07007-0986
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (201) 575-1300
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INFORMATION TO BE INCLUDED IN THE REPORT
Item 5. Other Events.
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Registrant's press release dated November 1, 1996 is filed
herewith as Exhibit 20 and is incorporated herein by reference.
Item 7. Financial Statements and Exhibits.
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(c) Exhibits.
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20. Press release of Registrant dated November 1, 1996.
SIGNATURE
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Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this Current Report to be signed on its
behalf by the undersigned thereunto duly authorized.
MERRIMAC INDUSTRIES, INC.
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(Registrant)
By s/Eugene W. Niemiec
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Eugene W. Niemiec
President and Chief Executive
Officer
Date: November 4, 1996
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EXHIBIT INDEX
Sequentially
Exhibit Numbered Page
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20. Press release of Registrant dated
November 1, 1996.
FOR IMMEDIATE RELEASE
Merrimac Reports Restructuring and Loss; Announces Stock Repurchase Program
West Caldwell, New Jersey, November 1, 1996: Merrimac Industries, Inc. notes
that for the nine months ended September 28, 1996, which was a period comprised
of 39 weeks, sales were $10,111,000, a decline of $773,000 or 7.1%, from the
sales for the comparable nine months of 1995, which was comprised of 40 weeks,
with sales of $10,884,000. An accounting change in the quarterly composition
from 16 weeks in 1995 to 13 weeks in 1996 exacerbated comparison between the
third quarters of 1996 and 1995 and contributed to most of the reported decline
in revenue from $4,355,000 to $2,998,000. Same-week sales for the 16 weeks ended
October 5, 1996 were $4,175,000, a decline of 4.1% when compared to the prior
year.
The restructuring of engineering responsibilities and its attendant re-focus of
product lines impacted the valuation of inventories. A review of inventories,
certain intangibles arising from acquired product designs, a non-compete
agreement, and deferred compensation for a retiring senior officer resulted in
aggregate charges of $1,822,000, and charges net of tax benefits of $1,093,000
or $.70 per share, to operations in the third quarter of 1996. The restructuring
charge combined with non-recurring administrative costs of $400,000 for the
third quarter and $800,000 for the first nine months of 1996 for marketing
studies, extensive employee (TQM) training, ISO-9001 Certification and the
start-up of the new Costa Rican manufacturing facility impacted operating
results negatively, but will enable the Company to adapt to new growth
strategies for the future.
Net loss after the restructuring charge and the credit for income taxes was
$1,139,000 or $.73 per share for the third quarter and $574,000 or $.36 per
share for the first nine months of 1996. Net income and per share amounts were
$469,000 and $.26 and $1,199, 000 and $.68 for the third quarter and first nine
months of 1995, respectively.
Backlog has firmed at $6.8 million, up 20% over year-end 1995. The bulk of the
numerous small and developmental orders which had choked production capacity
have been processed during this quarter. The Company's new market-driven
philosophy of judiciously accepting development orders which have a high
probability of follow-up production work is expected to increase the return on
its engineering resources in 1997. Efforts to expedite deliveries and increase
production work-flow are underway.
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Merrimac Reports Restructuring and Loss; Announces Stock Repurchase Program
November 1, 1996
Page 2
As part of a new open-market stock repurchase program, the Company has been
authorized to purchase up to 100,000 shares, from time-to-time depending on
market conditions, in contemplation of establishing a stock bonus plan. The
Company is also formulating a plan involving treasury shares to be reserved in
connection with an employee performance option program for wide distribution to
middle management and plant employees throughout Merrimac. The options will be
exercisable only if the Company achieves specific sales and/or profitability
targets.
Merrimac Industries, Inc. located in West Caldwell, NJ employs 130 in the design
and manufacture of high-performance components for communications, defense and
aerospace markets. Merrimac (MRM) is listed on the American Stock Exchange.
Contact: Eugene W. Niemiec, President and CEO - Telephone: 201-575-1300
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MERRIMAC INDUSTRIES, INC.
SUMMARY OF CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
Quarter Ended
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Sept. 28, Oct. 07,
1996 1995
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13 Weeks 16 Weeks
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Net sales.............................. $ 2,998,000 $ 4,355,000
Income (loss) before income taxes
(A)................................... (1,843,000) 724,000
Provision (credit) for income
taxes (A)............................. (704,000) 255,000
Net income (loss) (A).................. (1,139,000) 469,000
Net income (Loss per common share
(A)................................... $ (.73) $.26
Weighted average common
shares outstanding..................... 1,565,000 1,770,000
Nine Months
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Sept. 28, Oct. 07,
1996 1995
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39 Weeks 40 Weeks
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Net sales.............................. $10,111,000 $10,884,000
Income (loss) before income taxes
(A)................................... (984,000) 1,870,000
Provision (credit) for income
taxes (A)............................. (410,000) 671,000
Net income (loss) (A).................. (574,000) 1,199,000
Net income (loss) per common share
(A)................................... $(.36) $.68
Weighted average common
shares outstanding.................... 1,595,000 1,765,000
(A) Includes the effects of a restructuring charge of $1,822,000
($1,093,000 net of related tax benefits or $.70 per share) in 1996.
