UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 OR 15(d) of the Securities Exchange
Act of 1934.
For the quarterly period ended June 30, 1995
Commission file number 0-10976
MICROWAVE FILTER COMPANY, INC.
(Exact name of registrant as specified in its charter.)
New York 16-0928443
(State of Incorporation) (I.R.S. Employer Identification
Number)
6743 Kinne Street, East Syracuse, N.Y. 13057
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (315) 437-3953
Indicate by check mark whether 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 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 ( )
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practical date:
Common Stock, $.10 Par Value - 3,319,815 shares as of June
30, 1995.
<PAGE>
PART I. - FINANCIAL INFORMATION
MICROWAVE FILTER COMPANY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS AND NINE MONTHS
ENDED JUNE 30, 1995 AND 1994
(Unaudited)
(Amounts in thousands, except per share data)
Three months ended Nine months ended
June 30 June 30
1995 1994 1995 1994
[S] [C] [C] [C] [C]
Net sales $1,860 $2,105 $5,852 $6,174
Cost of goods sold 1,215 1,356 3,925 3,784
------- ------- ------- -------
Gross profit 645 749 1,927 2,390
Selling, general and
administrative expenses 673 731 2,060 2,287
------- ------- ------- -------
Income (loss) from
operations (28) 18 (133) 103
Other income (expense) (3) (2) (6) (8)
------- ------- ------- -------
Income (loss) before
income taxes (31) 16 (139) 95
Provision (benefit)
for income taxes (11) 6 (48) 33
------- ------- ------- -------
NET INCOME (LOSS) (20) 10 (91) 62
======= ======= ======= =======
Earnings (loss) per share ($0.01) $0.00 ($0.03) $0.02
======= ======= ======= =======
[FN]
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
MICROWAVE FILTER COMPANY, INC.
CONSOLIDATED BALANCE SHEETS
JUNE 30, 1995 SEPTEMBER 30, 1994
(Unaudited)
[S] [C] [C]
Assets
Current Assets:
Cash and cash equivalents $ 472 $ 657
Accounts receivable-trade,net 670 1,077
Federal and state income tax
receivable 62 -
Inventories 1,982 1,630
Prepaid expenses and other
current assets 221 170
-------- --------
Total current assets 3,407 3,534
Property,plant and equipment,net 1,689 1,850
Other assets 87 139
-------- --------
Total assets $ 5,183 $ 5,523
======== ========
Liabilities And Stockholders' Equity
Current liabilities:
Current portion of long term
debt $ 145 $ 142
Accounts payable 339 455
Customer deposits 189 128
Accrued federal and state
income taxes - 5
Accrued payroll and related
expenses 93 110
Accrued compensated absences 221 192
Accrued legal costs 134 111
Other current liabilities 32 95
-------- --------
Total current liabilities 1,153 1,238
-------- --------
Long term debt, less current
portion 477 583
Deferred compensation and
other liabilities 84 88
-------- --------
Total liabilities 1,714 1,909
-------- --------
Stockholders' Equity:
Common stock,$.10 par value 400 376
Additional paid-in capital 2,877 2,637
Retained earnings 829 1,141
-------- --------
4,106 4,154
Common stock in treasury,
at cost (637) (540)
-------- --------
Total stockholders' equity 3,469 3,614
-------- --------
Total liabilities and
stockholders' equity $ 5,183 $ 5,523
======== ========
[FN]
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
MICROWAVE FILTER COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS AND NINE MONTHS ENDED
JUNE 30, 1995 AND 1994
(Unaudited)
Three months ended Nine months ended
June 30 June 30
1995 1994 1995 1994
[S] [C] [C] [C] [C]
Cash flows from operating
activities:
Net income $ (20) $ 10 $ (91) $ 62
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Depreciation and amortization 100 96 298 329
Stock compensation 0 0 31 29
Change in assets and liabilities:
(Increase) decrease in:
Accounts receivable 315 (28) 346 (36)
Inventories (206) (142) (352) (320)
Prepaid expenses & other
assets 17 62 (29) 13
Increase (decrease) in:
Accounts payable & accrued
expenses (102) 56 (86) 193
Deferred compensation &
other liabilities (1) (1) (3) (3)
------- ------- ------- -------
Net cash provided by
operating activities 103 53 114 267
------- ------- ------- -------
Cash flows from investing activities:
Capital expenditures (19) (67) (107) (214)
Cash flows from financing activities:
Proceeds from long-term
borrowings 0 500 0 500
Principal payments on
long-term debt (38) (18) (107) (33)
Proceeds from sale of
common stock 7 4 13 12
Purchase of treasury
stock 0 0 (97) 0
------- ------- ------- -------
Increase (decrease) in cash
and cash equivalents 53 472 (184) 532
Cash and cash equivalents
at beginning of period 419 150 656 90
------- ------- ------- -------
Cash and cash equivalents
at end of period $ 472 $ 622 $ 472 $ 622
======= ======= ======= =======
[FN]
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
MICROWAVE FILTER COMPANY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1995
Note 1. Summary of Significant Accounting Policies
The accompanying financial statements, which should be read in conjunction
with the financial statements of Microwave Filter Company, Inc. ("the
Company") included in the 1994 Annual Report filed on Form 10-K, are
unaudited but have been prepared in the ordinary course of business for
the purpose of providing information with respect to the interim period.
The Company believes that all adjustments (none of which were other than
normal recurring accruals) necessary for a fair presentation for such
periods have been included.
Note 2. Earnings (loss) per share
Earnings (loss) per common share are calculated based upon the weighted
average number of shares of common stock outstanding during the periods
including, when significant, any common stock equivalents and after
restatement of any stock dividends. The weighted average number of shares
used for the computations were 3,309,790 for the nine months and 3,347,924
for the three months ending June 30, 1995 and 3,335,767 for the nine months
and 3,356,739 for the three months ending June 30, 1994.
Note 3. Inventories
Inventories are stated at the lower of cost determined on the first-in,
first-out method or market.
Inventories consisted of the following:
June 30, September 30,
1995 1994
Raw materials and stock parts $ 1,033 $ 916
Work-in-process 407 335
Finished goods 542 379
------- -------
$ 1,982 $ 1,630
======= =======
<PAGE>
MICROWAVE FILTER COMPANY, INC.
MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
JUNE 30, 1995
Net sales decreased $244,273 or 11.6% to $1,860,409 during the three months
ended June 30, 1995 when compared to net sales of $2,104,682 during the same
period last year.
The decrease in sales can primarily be attributed to a decrease in the sales
of the Company's Wireless Cable products. The Company has experienced a
slowdown in Wireless Cable product orders over the last few months. Although
the Company believes that market demand will grow, the timing is unknown at
this time. The Company plans to continue aggressively marketing these products
and to continue developing new products for this market.
Net sales decreased $321,955 or 5.2% to $5,852,136 during the nine months
ended June 30, 1995 when compared to net sales of $6,174,091 during the same
period last year.
As a result of the decrease in Wireless Cable product orders, the Company's
sales order backlog decreased to $1,759,072 at June 30, 1995 compared to
$2,040,319 at March 31, 1995 and $1,822,611 at September 30, 1994.
The Company recorded a net loss of $90,996 for the nine months ended June
30, 1995 compared to a net profit of $61,886 for the same period last year.
The decrease in net income can primarily be attributed to the decrease in
sales.
Selling, general and administrative expenses decreased $227,462 or 9.9%
to $2,059,868 during the nine months ended June 30, 1995 when compared to
$2,287,330 during the same period last year primarily as a result of the
Company's cost reduction efforts during fiscal 1995. As a percentage of
sales, selling, general and administrative expenses decreased to 35.2%
during the nine months ended June 30, 1995 compared to 37.0% during the
same period last year.
Cash and cash equivalents decreased $184,299 to $472,262 at June 30, 1995
when compared to September 30, 1994. The decrease was a result of $113,797
in net cash provided by operating activities, $106,997 in net cash used for
capital expenditures and $191,099 in net cash used in financing activities.
At June 30, 1995, the Company had available aggregate lines of credit
totaling $600,000. In addition, the Company has a Letter of Credit facility
available, for up to $500,000, which will be secured by specified inventory
being purchased. At June 30, 1995, the Company had $60,319 in letters of
credit outstanding.
Management believes that its working capital requirements for the forseeable
future will be met by its existing cash balances, future cash flows and its
current credit arrangements.
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
The Company is unaware of any material threatened or pending
litigation against the company.
Item 2. Changes in Securities
None during this reporting period.
Item 3. Defaults Upon Senior Securities
The Company has no senior securities.
Item 4. Submission of Matters to a Vote of Security Holders
None during this reporting period.
Item 6. Exhibits and Reports on Form 8-K
None.
Pursuant to the requirements of the Securities and Exchange Act
of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
MICROWAVE FILTER COMPANY, INC.
August 14, 1995 Carl F. Fahrenkrug
(Date) --------------------------
Carl F. Fahrenkrug
Chief Executive Officer
August 14, 1995 Richard L. Jones
(Date) --------------------------
Richard L. Jones
Chief Financial Officer
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