<PAGE>
<PAGE>
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 June 30, 1995
---------------------------------
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 0-11877
-------
ELXSI CORPORATION
----------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 77-0151523
----------------------------------- -------------------------
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) no.) identification
4209 Vineland Road, Suite J-1, Orlando, Florida 32811
----------------------------------------------- ------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including
area code: (407) 849-1090
-----------------------------------------------------
-----------------------------------------------------------------
(Former name, former address and former fiscal year, if changed
since last report.)
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
On August 4, 1995, the registrant had outstanding 4,792,340
shares of Common Stock, par value $0.001 per share.
PAGE
<PAGE>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
ELXSI CORPORATION
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
A S S E T S
June 30, December 31,
1995 1994
------- ------------
Current assets:
Accounts receivable, net $ 3,226 $ 2,278
Inventory, net 6,707 6,208
Prepaid expenses and other
current assets 523 205
---------- ----------
Total current assets 10,456 8,691
Property, buildings and
equipment, net 24,334 24,275
Intangible assets, net 5,796 5,891
Deferred debt costs, net 256 322
Note receivable - related party 1,156 1,156
Other 340 181
---------- ----------
Total assets $ 42,338 $ 40,516
========== ==========
The accompanying notes are an integral part of these consolidated
financial statements.<PAGE>
ELXSI CORPORATION
CONSOLIDATED BALANCE SHEETS (Continued)
(Dollars in Thousands)
LIABILITIES AND STOCKHOLDERS' EQUITY
June 30, December 31,
1995 1994
----------- ------------
Current liabilities:
Accounts payable and
drafts payable $ 4,397 $ 4,016
Accrued expenses 3,469 4,002
Capital lease obligations 36 33
Current portion of long-term
debt 1,565 1,063
---------- ----------
Total current liabilities 9,467 9,114
Capital lease obligations -
non current 1,549 1,569
Long-term debt, net of discount 10,361 9,639
Other liabilities 971 796
---------- --------
Total liabilities 22,348 21,118
Commitments and contingencies:
Stockholders' equity:
Preferred stock Series A
Non-voting Convertible, par
value $0.002 per share
Authorized -- 5,000,000 shares
Issued and outstanding -- none --- ---
Common stock, par value $0.001
per share
Authorized -- 160,000,000 shares,
Issued and outstanding --
4,792,338 shares at June 30,
1995 and 5,032,333 shares
at December 31, 1994 5 5
Additional paid-in capital 229,666 230,890
Accumulated deficit (209,612) (211,441)
Cumulative foreign currency
translation adjustment (69) (56)
---------- --------
Total stockholders' equity 19,990 19,398
---------- --------
$ 42,338 $ 40,516
========== =========
The accompanying notes are an integral part of these consolidated
financial statements.<PAGE>
ELXSI CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in Thousands, Except Per Share Data)
(Unaudited)
Three Months Ended
------------------
June 30,
------------------
1995 1994
---- ----
Net sales $ 16,914 $ 15,631
Costs and expenses:
Cost of sales 13,011 11,767
Selling, general and administrative 1,744 1,698
Depreciation and amortization 515 461
--------- ---------
Operating income 1,644 1,705
Other income (expense):
Interest expense (422) (351)
Interest income 33 --
Other expense (33) (9)
--------- ---------
Income before income taxes 1,222 1,345
Provision for income taxes 138 106
--------- ---------
Net income $ 1,084 $ 1,239
========= =========
Net income per common share $ 0.21 $ 0.20
========= =========
Weighted average number of common
and common equivalent shares 5,059 6,034
========= =========
The accompanying notes are an integral part of these consolidated
financial statements.<PAGE>
ELXSI CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in Thousands, Except Per Share Data)
(Unaudited)
Six Months Ended
------------------
June 30,
------------------
1995 1994
---- ----
Net sales $ 32,528 $ 29,859
Costs and expenses:
Cost of sales 25,215 22,995
Selling, general and administrative 3,421 3,320
Depreciation and amortization 1,029 909
--------- --------
Operating income 2,863 2,635
Other income (expense):
Interest expense (848) (739)
Interest income 64 --
Other expense (24) (16)
--------- ---------
Income before income taxes 2,055 1,880
Provision for income taxes 226 152
--------- ---------
Net income $ 1,829 $ 1,728
========= =========
Net income per common share $ 0.36 $ 0.28
========= =========
Weighted average number of common
and common equivalent shares 5,095 6,128
========= =========
The accompanying notes are an integral part of these consolidated
financial statements.<PAGE>
ELXSI CORPORATION
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(Amounts in Thousands)
(Unaudited)
Additional
Common Stock Paid-in
---------------------- Capital
Shares Dollars ----------
------ -------
Balance at
December 31, 1994 5,032 $ 5 $ 230,890
Net income -- -- --
Foreign currency
translation adjustment -- -- --
Purchase of 240,000
shares of Common
Stock (240) -- (1,224)
--------- -------- ----------
Balance at
June 30, 1995 $ 4,792 $ 5 $ 229,666
========= ======== ==========
The accompanying notes are an integral part of these consolidated
financial statements.<PAGE>
ELXSI CORPORATION
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (Continued)
(Dollars in Thousands)
(Unaudited)
Cumulative
Accum- Foreign
ulated Translation
Deficit Adjustment
-------- ------
Balance at
December 31, 1994 $(211,441) $ (56)
Net income 1,829 --
Foreign currency
translation
adjustment -- (13)
Purchase of 240,000
shares of Common
Stock -- --
--------- --------
Balance at
June 30, 1995 $(209,612) $ (69)
========= ========
The accompanying notes are an integral part of these consolidated
financial statements.<PAGE>
ELXSI CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
Six Months Ended June 30,
-----------------------------
1995 1994
-------- ---------
Cash flows from
operating activities:
Net income $ 1,829 $ 1,728
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation and amortization 1,029 909
Amortization of deferred
debt costs 116 45
Amortization of debt discount 8 22
(Gain) loss on disposal of
equipment (9) 9
Change in cumulative foreign
currency translation
adjustment (13) (22)
(Increase) decrease in assets:
Accounts receivable (948) 107
Inventories (499) 414
Prepaid expenses and other
current assets (318) 136
Other (159) 8
Increase (decrease) in liabilities:
Accounts payable and
drafts payable 381 (850)
Accrued expenses (533) 56
Other liabilities 175 150
------- -------
Net cash provided by operating
activities 1,059 2,712
------- -------
Cash flows from investing activities:
Purchase of property,
buildings and equipment (984) (876)
------- -------
Net cash used in
investing activities (984) (876)
------- -------
Cash flows from financing activities:
Net borrowing (payment) of
long-term debt 1,216 (1,828)
Principal payments
on capital leases (17) (14)
Purchase of Common Stock (1,224) --
Payment of deferred bank fees (50) --
Issuance of Common Stock -- 6
--------- ---------
Net cash used in financing
activities $ (75) $ (1,836)
--------- ---------
The accompanying notes are an integral part of these consolidated
financial statements.<PAGE>
ELXSI CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(Dollars in thousands)
(Unaudited)
Six Months Ended June 30,
-------------------------
1995 1994
---- ----
Increase (decrease) in cash
and cash equivalents $ -- $ --
Cash and cash equivalents,
beginning of period -- --
------- ------
Cash and cash equivalents
end of period $ -- $ --
======= ======
Supplemental Disclosure of Cash Flow Information
Cash paid during the year for
Income taxes $ 395 $ 286
Interest $ 718 $ 676
The accompanying notes are an integral part of these consolidated
financial statements.<PAGE>
ELXSI CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1995
(Unaudited)
Note 1. The Company
General The information contained in this report is unaudited
but, in management's opinion, all adjustments necessary for a
fair presentation have been included and were of a normal and
recurring nature. The results for the three and six months ended
June 30, 1995 are not necessarily indicative of results to be
expected for the entire year. These financial statements and
notes should be read in conjunction with ELXSI Corporation's
Annual Report on Form 10-K for the year ended December 31, 1994.
Prior to 1990, ELXSI Corporation (together with its subsidiaries,
the "Company") operated principally through its wholly-owned
California subsidiary, ELXSI. During that period, the principal
business of ELXSI was the design, manufacture, sale and support
of minisupercomputers. In September 1989, the Company
discontinued all computer operations.
On July 1, 1991, ELXSI acquired thirty Bickford's and twelve
Howard Johnson's Restaurants (the "Restaurants"), which are
located in Massachusetts, Vermont, New Hampshire, Rhode Island
and Connecticut, from Marriott Family Restaurants, Inc.
Since July 1991, ELXSI sold six of its Howard Johnson's
Restaurants, converted five others into Bickford's Restaurants
and opened seven new Bickford's Restaurants. On July 3, 1995,
ELXSI acquired sixteen Abdow's Family Restaurants from the Abdow
Corporation of Springfield, Massachusetts with the intention of
converting most into Bickford's Restaurants over a twelve to
eighteen month period. Currently, ELXSI operates forty two
Bickford's, sixteen Abdow's and one Howard Johnson's Restaurants.
On October 30, 1992, ELXSI acquired Cues, Inc. of Orlando,
Florida and its two wholly owned subsidiaries Knopafex, Ltd., a
Canadian company and Cues B.V., a Dutch company, together
referred to as ("Cues").
Cues is principally engaged in the manufacture and servicing of
video inspection and repair equipment for wastewater and drainage
systems, primarily for governmental municipalities, service
contractors and industrial users.
Note 2. Subsequent Event
On July 3, 1995, ELXSI acquired 16 Abdow's Family Restaurants
from Abdow Corporation of Springfield, MA for a price of
approximately $3,800,000 including estimated expenses of
$300,000. The transaction, which includes the leasing of 16
restaurant sites and the purchase of associated assets located in
western Massachusetts and central Connecticut, brings the total
number of restaurants operated by ELXSI to 59.
The transaction was financed by an increase in ELXSI's existing
line of credit with Bank of America Illinois, which recently was
extended to June 30, 1997. The total available credit on July 3,
1995 was increased to $15,840,000. The minimum monthly
reductions in available credit were increased from $220,000 per
month to $280,000 per month from July to December 1995 and
$3,330,000 annually thereafter, in equal monthly installments
from April through December.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
Results of Operations
The Company's 1995 and 1994 six-month and second quarter revenues
and expenses result from the operation of ELXSI's Restaurant and
Cues Divisions and the Company's corporate ("Corporate")
expenses.
Six Months Ended June 30, 1995
During the first half of 1995, the Company had net sales of
$32,528,000, cost of sales of $25,215,000, selling, general and
administrative expenses of $3,421,000 and depreciation and
amortization expense of $1,029,000, resulting in operating income
of $2,863,000. The operating income of $2,863,000 was reduced by
interest expense of $848,000, other expense of $24,000 and income
taxes of $226,000 and increased by interest income of $64,000,
resulting in net income of $1,829,000.
Earnings per share and the weighted average number of shares
outstanding for the six months ended June 30, 1995 were $0.36 per
share and 5,095,000 shares, respectively. This compares to $0.28
per share for the corresponding period in 1994, when there were
6,128,000 weighted average shares outstanding. The decrease in
the weighted average shares outstanding in the first half of 1995
resulted from the repurchase of Common Stock and Warrants to
purchase Common Stock during the fourth quarter of 1994 and the
first quarter of 1995 and, to a lesser extent, a decrease in the
average stock market price during the first quarter of 1995 as
compared to the same period in 1994. The average stock market
price for the first half of 1995 was $6.01 compared to an average
of $6.87 in the corresponding period of 1994. A decrease in
stock price results in a lesser number of shares outstanding for
purposes of determining the weighted average shares outstanding
used in the earnings per share calculation.
During the second quarter ended June 30, 1995, the Company
granted options to management for the purchase of 124,500 shares
of the Company's Common Stock at the current market value on the
date of the grant pursuant to the ELXSI Corporation 1995
Incentive Stock Option Plan, which was adopted by the
stockholders on May 18, 1995.
Six Months Ended June 30, 1994
During the first half of 1994, the Company had net sales of
$29,859,000, cost of sales of $22,995,000, selling, general and
administrative expenses of $3,320,000 and depreciation and
amortization expense of $909,000, resulting in operating income
of $2,635,000. The operating income of $2,635,000 was reduced by
interest expense of $739,000, other expense of $16,000 and income
taxes of $152,000, resulting in net income of $1,728,000.
Earnings per share and the weighted average number of shares
outstanding for the six months ended June 30, 1994 were $0.28 per
share and 6,128,000 shares, respectively.
Comparison of First Half 1995 Results to First Half 1994 Results
The six month sales increased $2,669,000, gross profit increased
$449,000, selling, general and administrative expense increased
$101,000 and depreciation and amortization expense increased
$120,000, resulting in an operating income increase of $228,000.
Interest expense increased by $109,000, interest income increased
by $64,000, other expense increased by $8,000 and income taxes
increased by $74,000, resulting in a increase in net income of
$101,000.
Restaurant Division. In the first half of 1995, restaurant sales
increased by $2,183,000 or 11.1% and gross profit increased
$572,000 or 14.9% compared to the same period in the prior year.
The gross profit increase was partially offset by an increase in
selling, general and administrative expense of $67,000 and an
increase in depreciation and amortization expense of $107,000,
resulting in an operating income increase of $398,000. The sales
increase was primarily due to the opening of new Restaurants and
to increased sales of $913,000 or 4.7% at comparable Restaurants
opened during each period. The same store sales increase was
primarily attributable to the successful introduction of new
lunch and dinner items and an increase in customers. Customer
counts at Restaurants operated in the first half of both periods
increased approximately 1%, attributable to increases in the
first quarter.
The increase in Restaurant gross profit was a result of the
increase in sales and a .7% increase in the gross profit
percentage during the first half of 1995 compared to 1994. The
year-to-date increase in the gross profit percentage was a result
of the improvement in the first quarter compared to the same
period in the prior year.
Restaurant selling, general and administrative expense increased
by $67,000, with no major items responsible for the increase.
Depreciation and amortization expense increased by $107,000
during the first half of 1995. Restaurant depreciation and
amortization expense will continue to increase each year with the
addition of new restaurants or until such time as assets valued
and recorded at the date of the 1991 Restaurant Division
acquisition become fully depreciated. The equipment acquired in
that acquisition have a seven year useful life, and will become
fully depreciated in 1998.
As a result of the above items, operating income increased by
$398,000 or 16.1% in the first half of 1995. Restaurant Division
earnings before interest, taxes, depreciation and amortization
expense ("EBITD") increased by $505,000 or 15.7% during the six-
month period. Restaurant Division interest expense related to
the amortization of deferred bank fees and to capital lease
obligations increased by $19,000.
Cues Division. Cues' sales increased by $486,000 or 4.8% in the
first half of 1995 compared to the same period in the prior year.
Competitive pricing and additional labor costs related to new
product development contributed to a 2.5% decline in Cues' first
half gross profit percentage. The gross profit decline along with
increases in selling, general and administrative expense and
depreciation and amortization expense resulted in an operating
income decrease of $179,000 or 23.2%. Management continues to
focus on protecting market share and developing new products that
will provide better margins in the future. Included in the
increase in operating income is the effect of an increase in
selling, general and administrative expense of $43,000 and an
increase in depreciation and amortization expense of $13,000.
Corporate. Corporate general and administrative expenses was
approximately flat during the first six months of 1995.
Interest expense increased by $94,000 due to a higher average
debt balance in 1995 and an increase in interest rates. The
higher average debt balance in 1995 was the result of spending
approximately $7.4 million to purchase the Company's common
stock, warrants to purchase common stock and subordinated notes
at the end of 1994 and the beginning of 1995. The prime lending
rate applicable to Company borrowings was 9% and 7-1/4% at June
30, 1995 and 1994, respectively. On July 7, 1995, this prime
lending rate was reduced to 8-3/4%. The Company's senior debt
borrowing rate is currently at 10% with a scheduled decrease of
1/4% in September 1995 to prime plus 1%. During the first half
of 1994, the Company recorded interest income of $64,000 in
connection with a note receivable due from a related party.
Income tax expense represented an effective rate of 11.0%
compared to 8.1% in the first half of 1994 due to the loss of
certain state net operating loss carryforwards that were
available in 1994.
Quarter Ended June 30, 1995
During the three months ended June 30, 1995, the Company had net
sales of $16,914,000, cost of sales of $13,011,000, selling,
general and administrative expenses of $1,744,000 and
depreciation and amortization expense of $515,000, resulting in
operating income of $1,644,000. The operating income of
$1,644,000 was reduced by interest expense of $422,000, other
expense of $33,000 and income taxes of $138,000 and increased by
interest income of $33,000, resulting in net income of
$1,084,000.
Earnings per share and the weighted average number of shares
outstanding for the quarter ended June 30, 1995 were $0.21 per
share and 5,059,000 shares, respectively. This compares to $0.20
per share for the corresponding period in 1994, when there were
6,034,000 weighted average shares outstanding. The decrease in
the weighted average shares outstanding in the second quarter of
1995 resulted from the repurchase of Common Stock and Warrants to
purchase Common Stock during the fourth quarter of 1994 and the
first quarter of 1995 and, to a lesser extent, a decrease in the
average stock market price during the first quarter of 1995 as
compared to the same period in 1994. The average stock market
price for the second quarter of 1995 was $5.99 compared to an
average of $6.18 in the corresponding period of 1994.
Quarter Ended June 30, 1994
During the three months ended June 30, 1994, the Company had net
sales of $15,631,000, cost of sales of $11,767,000, selling,
general and administrative expenses of $1,698,000 and
depreciation and amortization expense of $461,000, resulting in
operating income of $1,705,000. The operating income of
$1,705,000 was reduced by interest expense of $351,000, other
expense of $9,000 and income taxes of $106,000, resulting in net
income of $1,239,000.
Earnings per share for the quarter ended June 30, 1994 was $0.20
per share and the weighted average number of shares outstanding
was 6,034,000.
Comparison of Second Quarter 1995 Results to Second Quarter 1994
Results
The second quarter sales increased $1,283,000, gross profit
increased $39,000, selling, general and administrative expense
increased $46,000 and depreciation and amortization expense
increased $54,000, resulting in an operating income decrease of
$61,000. Interest expense increased by $71,000, other expense
increased by $24,000, income taxes decreased by $32,000 and
interest income increased by $33,000, resulting in a decrease in
net income of $155,000.
Restaurant Division. Restaurant sales increased by $987,000 or
9.4% in the second quarter of 1995 compared to the same period in
the prior year. The sales increase was primarily due to the
opening of new Restaurants and to increased sales of $245,000 or
2.4% at comparable Restaurants opened during each period. The
same store sales increase was primarily attributable to the
successful introduction of new lunch and dinner items. Customer
counts at Restaurants operated in the second quarter of both
periods decreased approximately 1%.
Restaurant gross profit increased by $131,000 or 5.7% in 1995,
due to a .8% decline in the gross profit percentage during the
second quarter of 1995 compared to 1994. This decline resulted
primarily from an increase in food costs, primarily coffee, and
labor costs.
Restaurant selling, general and administrative expense increased
by $59,000, while Restaurant depreciation and amortization
expense increased by $55,000 during the second quarter 1995.
Operating income increased $17,000 or 1% after deducting the
increase in selling, general and administrative expense and the
increase in depreciation and amortization expense. Restaurant
Division EBITD increased by $72,000 or 3.6%.
Restaurant division interest expense related to the amortization
of deferred bank fees and to capital lease obligations increased
by $25,000.
Cues Division. Cues' sales increased by $296,000 or 5.7% in the
second quarter of 1995 compared to the same period in the prior
year. Price erosion and additional labor costs related to new
product development contributed to an 3.3% decline in Cues'
second quarter gross profit percentage. Due to the erosion in
the gross profit percentage, operating income decreased by
$125,000 or 30.3%. Included in the decrease in operating income
is the effect of an increase in selling, general and
administrative expense of $34,000 and a decrease in depreciation
and amortization expense of $1,000.
Corporate. Corporate general and administrative expense
decreased by $47,000 during 1995. Interest expense increased by
$44,000, due to a higher average debt balance and an increase in
the prime lending rate in 1995. During the second quarter of
1995, the Company recorded interest income of $64,000 in
connection with a note receivable due from a related party.
Liquidity and Capital Resources
Available Resources. The Company's unrestricted consolidated
cash positions at June 30, 1995 and December 31, 1994 was $0.
During the first half of 1995, the Company had cash flow from
operations before working capital and other changes of
$2,960,000. Working capital changes and other assets and
liabilities decreased cash flow from operations to $1,059,000,
which along with an increase in long-term bank debt of $1,216,000
funded the purchase of property, buildings and equipment
totalling $984,000, the purchase of 240,000 shares of Common
Stock for $1,224,000, and the payment of capital leases
obligations of $17,000 and deferred bank fees of $50,000.
During the first half of 1995, current assets increased by
$1,765,000, primarily due to an increase in Cues' accounts
receivable and inventory and a one-time increase in Restaurant
Division prepaid expenses of $335,000 as a result of up-front
costs paid in connection with the July 3, 1995 acquisition of
Abdow's Family Restaurants. The increase in current assets was
slightly offset by a decrease in current liabilities (excluding
the current portion of long-term debt and capital leases) of
$152,000. During the first half of 1994, the Company had cash
flow from operations before working capital and other changes of
$2,691,000. Working capital changes and other assets and
liabilities increased cash flow from operations to $2,712,000,
which funded the purchase of property, buildings and equipment
totalling $876,000, and repaid long term bank debt, subordinated
debt and capital leases obligations of $1,265,000, $563,000 and
$14,000, respectively. During the first half of 1994, current
assets decreased by $657,000, primarily due to a decrease in
Cues' accounts receivable and inventory. The decrease in current
assets was offset by a decrease in current liabilities of
$794,000. The decrease in current liabilities consisted mainly
of a decrease in accounts payable and drafts payable at the
Restaurant and Cues Divisions of $234,000 and $616,000,
respectively. It also includes an increase in accrued expenses
of $146,000 during the first half of 1994.
The Company maintains no cash in its bank accounts as a result of
instituting a cash management system whereby the net cash
generated by operations is immediately used to reduce bank debt.
The immediate reduction of outstanding debt provides the Company
with a greater reduction in interest expense than could be offset
with interest income from alternative investments. Working
capital needs, when they arise, are met by daily borrowings.
Future Needs For and Sources of Capital. Management believes
that cash generated by operations is sufficient to fund current
operations including the interest payments on its senior bank
debt and interest payments on the remaining $1,251,000
outstanding principal balance of 14.5% and 15% Senior
Subordinated Notes. With bank approval, excess funds are
available under the Company's loan Agreement to finance
additional acquisitions.
Impact of Inflation. Inflationary factors such as increases in
food and labor costs directly affect the Company's operations.
Many of the Restaurant employees are paid hourly rates related to
the federal minimum wage and, accordingly, increases in the
minimum wage will result in increases in the Company's labor
costs. Currently, there are no further mandated increases in the
federal minimum wage. Federal legislation mandating that
employers pay 80% of health insurance premiums, if enacted, will
increase benefits costs since employees currently pay in excess
of the 20% being proposed. In addition, the cost of food
commodities utilized by the Company are subject to market supply
and demand pressures. Shifts in these costs may have a
significant impact on the Company's food costs. The Company
anticipates that food cost increases can be offset through
selective price increases, although no assurances can be given
that the Company will be successful in this regard.
Increases in interest rates could negatively affect the Company's
operations.
<PAGE>
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security-Holders.
The Company's 1995 Annual Meeting of Stockholders was held on May
18, 1995. In connection therewith the Company submitted three
proposals to stockholders in its Notice of Annual Meeting of
Stockholders and Proxy Statement dated April 14, 1995.
All directors of the Company were re-elected as such at the 1995
Annual Meeting of Stockholders, having received votes as follows:
Nominee For Withheld
------- -------- ---------
Farrokh H. Kavarana 3,924,235 21,161
Kevin P. Lynch 3,924,280 21,116
Alexander M. Milley 3,924,140 21,256
John C. Savage 3,924,274 21,122
Robert C. Shaw 3,924,242 21,154
A majority of the stockholders approved the Company's 1995
Incentive Stock Option Plan, voting as follows:
Against/ Broker
For Withheld Abstentions Non Votes
-------- ---------- --------- ---------
Number of votes 3,691,956 132,827 10,485 110,128
A majority of the stockholders approved the appointment of Price
Waterhouse LLP as the Company's independent accountants for the
fiscal year ending December 31, 1995, voting as follows:
Against/ Broker
For Withheld Abstentions Non Votes
------- --------- ----------- ---------
Number of votes 3,935,814 3,339 6,243 --
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
27. Financial Data Schedule
(b) Reports on Form 8-K.
In connection with the acquisition of 16 Abdow's Family
Restaurants on July 3, 1995, the Company filed a current report
on Form 8-K dated July 3, 1995.
PAGE
<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.
ELXSI CORPORATION
-----------------------------
(Registrant)
Date: August 10, 1995 /s/ Alexander M. Milley
-----------------------------
Alexander M. Milley, Chairman
of the Board, President and Chief
Executive Officer
(Principal Executive Officer)
Date: August 10, 1995 /s/ Thomas R. Druggish
----------------------------
Thomas R. Druggish, Vice President
Finance, Treasurer and Corporate
Secretary
(Chief Accounting Officer)
PAGE
<PAGE>
INDEX TO EXHIBITS
Exhibit No. Description Page No.
---------- ----------- --------
+27. Financial Data Schedule
_______________
+ Filed herewith.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 3,226,000
<ALLOWANCES> 40,000
<INVENTORY> 6,707,000
<CURRENT-ASSETS> 10,456,000
<PP&E> 24,334,000
<DEPRECIATION> 0
<TOTAL-ASSETS> 42,338,000
<CURRENT-LIABILITIES> 9,467,000
<BONDS> 0
<COMMON> 5,000
0
0
<OTHER-SE> 19,985,000
<TOTAL-LIABILITY-AND-EQUITY> 42,338,000
<SALES> 32,528,000
<TOTAL-REVENUES> 32,528,000
<CGS> 25,215,000
<TOTAL-COSTS> 29,665,000
<OTHER-EXPENSES> 24,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 848,000
<INCOME-PRETAX> 2,055,000
<INCOME-TAX> 226,000
<INCOME-CONTINUING> 1,829,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,829,000
<EPS-PRIMARY> 0.36
<EPS-DILUTED> 0
</TABLE>
