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 December 31, 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 - 3,326,779 shares as of December
31, 1995.
<PAGE>
PART I. - FINANCIAL INFORMATION
MICROWAVE FILTER COMPANY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS
ENDED DECEMBER 31, 1995 AND 1994
(Unaudited)
(Amounts in thousands, except per share data)
Three months ended
Dec. 31
1995 1994
[S] [C] [C]
Net sales $2,091 $1,964
Cost of goods sold 1,253 1,293
------- -------
Gross profit 838 671
Selling, general and
administrative expenses 646 651
------- -------
Income (loss) from
operations 192 20
Other income (expense) 1 (4)
------- -------
Income (loss) before
income taxes 193 16
Provision (benefit)
for income taxes 67 5
------- -------
NET INCOME (LOSS) 126 11
======= =======
Earnings (loss) per share $0.04 $0.00
======= =======
[FN]
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
MICROWAVE FILTER COMPANY, INC.
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 1995 SEPTEMBER 30, 1995
(Unaudited)
[S] [C] [C]
Assets
Current Assets:
Cash and cash equivalents $ 962 $ 521
Accounts receivable-trade,net 771 879
Inventories 1,839 1,969
Prepaid expenses and other
current assets 215 215
-------- --------
Total current assets 3,787 3,584
Property,plant and equipment,net 1,568 1,625
Other assets 61 65
-------- --------
Total assets $ 5,416 $ 5,274
======== ========
Liabilities And Stockholders' Equity
Current liabilities:
Current portion of long term
debt $ 148 $ 147
Accounts payable 354 362
Customer deposits 302 282
Accrued federal and state
income taxes 98 43
Accrued payroll and related
expenses 71 91
Accrued compensated absences 195 183
Other current liabilities 74 83
-------- --------
Total current liabilities 1,242 1,191
-------- --------
Long term debt, less current
portion 403 440
Deferred compensation and
other liabilities 58 59
-------- --------
Total liabilities 1,703 1,690
-------- --------
Stockholders' Equity:
Common stock,$.10 par value 401 400
Additional paid-in capital 2,884 2,881
Retained earnings 1,065 940
-------- --------
4,350 4,221
Common stock in treasury,
at cost (637) (637)
-------- --------
Total stockholders' equity 3,713 3,584
-------- --------
Total liabilities and
stockholders' equity $ 5,416 $ 5,274
======== ========
[FN]
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
MICROWAVE FILTER COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED
DECEMBER 31, 1995 AND 1994
(Unaudited)
Three months ended
December 31
1995 1994
[S] [C] [C]
Cash flows from operating
activities:
Net income $ 126 $ 11
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Depreciation and amortization 85 98
Change in assets and liabilities:
(Increase) decrease in:
Accounts receivable 108 (78)
Inventories 129 (282)
Prepaid expenses & other
assets (3) (21)
Increase (decrease) in:
Accounts payable & accrued
expenses 50 99
Deferred compensation &
other liabilities (1) (1)
------- -------
Net cash provided by
operating activities 494 (174)
------- -------
Cash flows from investing activities:
Capital expenditures (21) (23)
Cash flows from financing activities:
Principal payments on
long-term debt (36) (32)
Proceeds from sale of
common stock 4 3
Purchase of treasury
stock 0 (97)
------- -------
Increase (decrease) in cash
and cash equivalents 441 (323)
Cash and cash equivalents
at beginning of period 521 657
------- -------
Cash and cash equivalents
at end of period $ 962 $ 334
======= =======
[FN]
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
MICROWAVE FILTER COMPANY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 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 1995 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 3,324,564 and 3,302,491 for the three months
ending December 31, 1995 and December 31, 1994, respectively.
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:
December 31, September 30,
1995 1995
Raw materials and stock parts $ 957 $ 1,107
Work-in-process 386 394
Finished goods 496 468
------- -------
$ 1,839 $ 1,969
======= =======
<PAGE>
MICROWAVE FILTER COMPANY, INC.
MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
DECEMBER 31, 1995
Micowave Filter Company, Inc. achieved record first quarter sales of
$2,091,015 during the first quarter of fiscal 1996 which ended December
31, 1995.
Net sales increased $127,298 or 6.5% to $2,091,015 during the three
months ended December 31, 1995 when compared to sales of $1,963,717 during
the same period last year.
Net income increased $115,614 or 1,087% to $126,253 during the three
months ended December 31, 1995 when compared to net income of $10,639
during the same period last year.
As a percentage of sales, gross profit increased $166,892 to 40.1% during
the three months ended December 31, 1995 when compared to 34.2% during
the same period last year.
As a percentage of sales, selling, general and administrative expenses
decreased to 30.9% during the three months ended December 31, 1995 when
compared to 33.2% during the same period last year.
The increase in profits can be attributed to the increase in sales,
improved margins and a decrease in operating expenses when compared
to the same period last year.
Your Company's primary objective continues to be new product development
and an aggressive marketing plan to maximize performance and shareholder
value.
Cash and cash equivalents increased $441,379 to $962,055 at December 31,
1995 when compared to September 30, 1995. The increase was a result of
$494,310 in net cash provided by operating activities, $20,630 in net cash
used for capital expenditures and $32,301 in net cash used in financing
activities.
At December 31, 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 December 31, 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.
January 15, 1996 Carl F. Fahrenkrug
(Date) --------------------------
Carl F. Fahrenkrug
Chief Executive Officer
January 15, 1996 Richard L. Jones
(Date) --------------------------
Richard L. Jones
Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-START> OCT-01-1995
<PERIOD-END> DEC-31-1995
<CASH> 962
<SECURITIES> 0
<RECEIVABLES> 771
<ALLOWANCES> 0
<INVENTORY> 1,839
<CURRENT-ASSETS> 3,787
<PP&E> 4,895
<DEPRECIATION> 3,327
<TOTAL-ASSETS> 5,416
<CURRENT-LIABILITIES> 1,242
<BONDS> 402
<COMMON> 401
0
0
<OTHER-SE> 3,312
<TOTAL-LIABILITY-AND-EQUITY> 5,416
<SALES> 2,091
<TOTAL-REVENUES> 2,091
<CGS> 1,253
<TOTAL-COSTS> 1,899
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 10
<INCOME-PRETAX> 193
<INCOME-TAX> 67
<INCOME-CONTINUING> 126
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 126
<EPS-PRIMARY> .04
<EPS-DILUTED> .04
</TABLE>
